Startup Profile

Our Leg Up

Melbourne, Australia

Our Leg Up (OLU) is building Australia's Bank of Mum and Dad, so partner lenders can democratise access to homeownership

Team members:

Michael Ragavan

Founder & CEO

David Hellier

CTO

Ron Vidal

CRO

The problem we're solving

In Australia, not owning a home is the #1 driver of generational wealth inequality (ACOSS report). For most, this represents the largest asset they will purchase and most important wealth accumulation vehicle. As the cost of living rises, many Australians are locked out of the market, risking their future financial security or being forced to move away. Saving a deposit is the largest barrier to homeownership.

Our solution

OLU has developed new and differentiated product which pools the equity of property owners into a fund that can be pledged as additional security for a partner lenders’ home loans. This enables partner lenders to offer reduced interest rate home loans, with less risk and improved margin. This means aspiring homeowners with a low deposit (e.g., 5%-15%) can purchase a home 5-10 years sooner and save $10’000’s in the process through lower fees and interest repayments (compared to LMI).

Our differentiator

Through OLU’s platform, lenders can improve their margin by lowering the loan-to-value ratio (LVR) of home loans, reduce risk weighted assets, and lower common equity tier one (CET1) capital requirements - the most expensive and regulated source. This helps meet APRA’s regulatory requirements for capital adequacy more efficiently, whilst providing a sustainable pricing advantage. Our products is a world's first, with no direct competition.

Biggest achievement

1. Created new product, secured legal opinion on impact for lenders. 2. Signed agreements in-principle with two lenders to launch our product. This milestone is a strong endorsement from industry players and evaluators. 3. Generated $40M in equity commitment interest, with $20M direct ($0 CAC), and $20M via distribution channel trial with one partner. 4. Capacity to support $250M home loan pilot, with one partner lender’s interest rate with OLU the leading offer in the <20% deposit segment.

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