Rocket Companies to acquire personal finance app Truebill for $1.3 billion – Crain’s Detroit Business
The parent company of Rocket Mortgage continues to expand into the world of all things personal finance.
Detroit-based Rocket Companies Inc. on Monday announced it has entered an agreement to acquire Truebill, a Maryland personal finance company, for $1.275 billion, according to a news release. The all-cash deal is expected to close before the end of the year, and is expected to add $100 million in annual recurring revenue to Rocket’s $1.3 billion of annualized servicing fee income, according to the release.
Truebill works with consumers to help them manage subscriptions, track spending and build budgets. The company also will renegotiate bills for its clients, which it says saves them as much as 20 percent on regular expenses like cable and phone bills.
Rocket Companies Vice Chairman and CEO Jay Farner told Crain’s in an interview on Monday that the acquisition checks three main boxes for the company: helping with customer acquisition early on to bring consumers into the Rocket Companies “funnel” that consists of mortgages, car loans and several other elements of consumer finance. Additionally, the deal helps with bringing more customers into the mortgage realm, and ultimately keeps them in the Rocket ecosystem.
“Now I’ve got an app on someone’s phone that they’re using on a daily or weekly basis,” Farner said of the addition of Truebill. “They’re getting push notifications as deposits and withdrawals come into their bank account. And so all of those millions of clients that we already spend all this money on to bring to our site are now engaging with us day in, day out. And many of them are signing up for the services that make them subscription members.
“And that means there’s reoccurring revenue being added to our platform.”
The acquisition amounts to Rocket Companies’ first venture into the M&A market since its initial public offering in August 2020, raising $1.8 billion. Dan Gilbert, the company’s billionaire founder and chairman, however, hinted at the time that acquisitions would be a strategy going forward.
“We want to use our stock as currency and potentially acquire more fintech organizations and put them in the mold,” Gilbert told CNBC at the time.
Farner told Crain’s that the acquisition leaves Rocket Companies with a little under $4 billion in cash available on its balance sheet that could be used for further acquisitions down the road.
Farner said that most of Truebill’s roughly 150 employees will remain based in Maryland, with some being located in the Bay Area in California. The integration of the two companies will begin next year and specific marketing and branding will be determined at …….