Real Estate Fintech Startup Obligo Raises $5 Million

Fintech startup Obligo Inc. announced Tuesday the completion of a $5 million seed financing round. The round was led by Israel-based venture capital firm 83 North and participated by Entrée Capital, HFZ Capital, and Viola Credit.

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Serving the real-estate market, Obligo offers an alternative to the security deposit—the sum of money required by most landlords when renting an apartment. Obligo’s solution has renters provide landlords with a limited billing authorization based on open banking technology and backed by credit. In the event of a claim at the end of a tenancy, Obligo pays landlords immediately, collecting the money from the tenants in installments. Obligo’s service is subscription-based and starts at $9.90 per month.

Obligo was founded by Israeli brothers Omri Dor and Roey Dor and is based in New York.

Obligo has recently entered partnerships with New York landlords Olshan Properties, a privately owned real estate firm, and Adam America, a real estate developer and investor. The two real estate companies collectively own and manage more than 15,000 rental units in New York City, Obligo said. “With a traditional deposit, you’re paying a huge sum in advance for damage that likely won’t happen. It’s wasteful and completely unnecessary, considering what’s possible with modern financial technology,” Obligo CEO and Co-Founder Omri Dor said in a statement. “What Obligo offers is a common-sense approach. Tenants should only pay for damages if they actually cause damages.”