“Wes and his team exceeded my expectations. Thanks to Wes and the V&E team, we’ve achieved a monumental milestone at OJO Labs.”
Looking for the house of your dreams? OJO Labs is ready to help you find it.
The fast-rising real estate tech startup empowers homebuyers to make better decisions with proprietary technology that blends machine learning and human intelligence.
It all starts with an A.I.-powered virtual assistant, dubbed OJO, which interacts with consumers via text. Homebuyers can ask OJO questions relevant to their search, and OJO provides answers using artificial intelligence or humans. Over the course of this interaction, OJO learns about a consumer’s preferences and budget and then provides appropriate home recommendations. If and when a customer is ready to talk to a real estate professional, OJO will make the introduction.
“Anyone who’s purchased a home, even if they’re financially sophisticated, knows it’s a daunting process,” said OJO Labs General Counsel Dave Robinett. “We’re working to make the process a simpler and better experience for consumers.”
Last year, in an effort to significantly scale its business, OJO Labs decided to do some shopping of its own. The Austin-based tech company set its sights on Movoto, the fastest-growing top 5 residential real estate search site in the United States with nearly 24 million monthly visits. With Movoto, OJO Labs is poised to bring its deeply personalized technology to millions of consumers, offering services from initial stages of home search, all the way through closing.
But while the transaction presented big opportunities, it also came with challenges. The Movoto acquisition would be larger and more complex than two previous OJO deals Robinett handled on his own. As a result, OJO would benefit from hiring a law firm that had experience working on comparable deals, as well as capabilities in a wide range of practice areas including tax, employment law, executive benefits, and intellectual property.
Enter V&E partner Wes Jones. Jones, a go-to M&A lawyer with extensive experience advising venture-backed tech companies, had remained in touch with Robinett, a V&E alum. In November, Robinett hired his former V&E colleague to handle the Movoto acquisition – a major milestone which cemented OJO Labs as the first-ever end-to-end platform for buying and selling homes at scale.
“Having known Wes for about 20 years, I knew that he would do a great job and his team would do a great job,” Robinett said. “Wes and his team exceeded my expectations. Thanks to Wes and the V&E team, we’ve achieved a monumental milestone at OJO Labs.”
Soon after being retained, Jones recommended that V&E help in shaping and negotiating the deal term sheet. In doing so, he sought to minimize the potential problems and slowdowns that might occur when negotiating the final agreement.
“Getting your counsel involved early in the deal so that they can be involved in the shaping and the negotiation of the term sheet ends up paying multiple dividends,” Jones said.
Though it took some time to hammer out terms, by February 2020, OJO Labs and Movoto had a preliminary agreement. Then, in March, COVID-19 hit, casting a pall over the housing market. The transaction hung in the balance.
After an assessment, the companies were ready to head back to the negotiating table in late April. But now the pressure was on to move swiftly.
“Once the deal came back online both sides wanted to get it done as quickly as possible,” Jones said. “Either side could have had a change of heart, or COVID could have gotten worse or better. All of those things could have affected the willingness of each side to do a deal at a certain price.”
The V&E team was able to conduct due diligence, negotiate, and draft the acquisition agreement – all via Zoom – in a timely manner. On June 24, 2020 OJO Labs announced that it had closed on a $62.5 million funding round and had acquired Movoto.
Overall, Robinett said he appreciated the practical perspective Jones brought to the transaction. Earlier in his career, Jones spent six years working for a software company as it engaged in three rounds of venture capital funding, a merger, and an IPO.
“He understands that every decision we make ultimately is a combination of a legal and a business decision,” Robinett said.
Also valuable was Jones’ knowledge of M&A trends and the terms currently being negotiated by buyers and sellers. Armed with that market intelligence, Robinett was better able to advise OJO Labs’ executive team.
“Wes deeply understands the current M&A market,” Robinett said. “It was great to have the institutional knowledge of V&E, and Wes, behind us.”