Yardsworth is a company that is helping homeowners monetize underutilized backyards. Pulse 2.0 interviewed Yardsworth founder Matt Lucido to learn more about the company.
Matt Lucido’s Background
Lucido went to The University of Virginia (UVA) for undergraduate studies, where he played baseball and studied American Government and US History, then went to the University of Southern California (USC) Marshall School of Business for my MBA. And Lucido said:
“I’m a serial founder – I’ve founded three real-estate related tech companies (with one exit so far), and also worked as an venture capital investor at Wavemaker Partners here in Los Angeles. Really, though, my passion is housing – it’s the biggest problem of our time. That’s why I’m so excited about what we’re doing at Yardsworth – we’re helping to solve the housing crisis.”
Formation Of Yardsworth
How did the idea for Yardsworth come together? Lucido shared:
“My co-founder and I started Yardsworth to help solve the housing crisis by making homeownership more accessible in some of the most expensive housing markets in the country. We originally began as a unique ADU financing platform for lower-income homeowners, and it really opened our eyes to the tremendous value locked up backyards for the past 80-100 years due to restrictive zoning. Then, when CA’s new upzoning law (SB9 – the HOME Act) came into effect, we knew we had a once-in-a-generation opportunity to be impactful.”
“We have the tech and know-how to unlock value / “create” buildable land in people’s backyards… Now, we can effectively pay homeowners $100s of thousands of dollars to stay in their homes and communities vs. being displaced/gentrified out. It’s a huge opportunity.”
Favorite Memory
What has been your favorite memory working for the company so far? Lucido reflected:
“Without a doubt, it was when we signed up our first customer, Vance. We’re paying him over $150,000 (which is more than the annual average household income in his area), tax-free and debt-free. He’s using it for his upcoming retirement and to do some home renovations – but it’s a life-changing amount of money for him and his family. And by buying just a portion of his yard, we’re paying him to stay in his home vs. having to sell his home and move (gentrification/displacement). When we signed that first contract, it really clicked for me and my team – we’re going to change a lot of lives.”
Core Products
What are the company’s core products and features? Lucido explained:
“Our core product is the Yardsworth – it’s our proprietary estimate for backyard value. You punch in an address, and we’ll tell you what your yard’s worth (‘yard’s worth’ – get it?!). What’s really exciting is what comes next – we then offer to buy your backyard, in cash, for your Yardsworth value.”
“That means we subdivide your lot (we cover 100% of all fees an expenses – from appraisals to surveys to engineers to city fees – about $75k worth on a typical deal) and then buy your yard for a six-figure sum so we can build a small house. It increases housing stock (CA needs 3.5 million homes by 2025), reduces commutes by putting housing inside city metros / near jobs, and helps keep communities intact by avoiding displacement.”
Challenges Faced
What challenges has Lucido faced in building the company? Lucido acknowledged:
“Of course – one of the issues we constantly deal with is the backlog/understaffing in city planning offices across the state. We love the city planners we work with – but they work too hard, and the processes take too long. It shouldn’t cost $75k to split a lot in CA, and it shouldn’t take more than 30 days. Unfortunately, it does… but that’s where we come in – we cover those costs and chase our planning partners every day until we get lots subdivided/split.”
Evolution Of Yardsworth’s Technology
How has the company’s technology evolved since launching? Lucido noted:
“We’ve always been technology-forward and data-centric. Everything we do is data-driven. Our data scientists help drive decisions on how to advertise, select the homes / areas in which we should invest, decide how much we can pay, etc. Then our tech stack helps automate operations on the backend.”
Significant Milestones
What have been some of the company’s most significant milestones? Lucido cited:
“We did test marketing last year, raised a private venture round, and launched at scale in 2023. To be clear, this market is brand new, and we are planning to invest hundreds of millions, directly into the pockets of low-to-middle-income homeowners in CA.”
Customer Success Stories
After asking Lucido about customer success stories, he highlighted:
“We’ve seen it all (and we’re just getting started) – customers who would have otherwise needed a HELOC but saw rates were 10%+ now, customers who were trying to sell their homes because they were sitting on equity but didn’t really/truly want to move, people who tried to sell their homes and couldn’t… One woman cried on my shoulder in her living room after telling me her husband had recently passed away – she wanted to keep the house they had shared but needed liquidity and didn’t have the energy anymore to maintain their garden… It was a great reminder of why we do this – we’re helping people stay in their homes and making housing more affordable.”
Total Addressable Market
What total addressable market (TAM) size is the company pursuing? Lucido assessed:
“The widely-cited statistic from Berkeley’s Terner Center is that there are likely to be 700,000 homeowners across CA who take advantage of SB9. We think it’s bigger than that, by the way. But let’s assume the average CA home we’re talking about is $1 million (this is why we have a housing crisis!) – that’s a $700 billion opportunity in just one state. Plus, other states are expected to follow California’s lead.”
Differentiation From The Competition
What differentiates the company from its competition? Lucido affirmed:
“This concept of selling a piece of a backyard is novel, new, unheard of. People have been tapping into home equity for generations though – and that’s the real competition – how have people done this historically, before Yardsworth? People typically 1) sell their homes and move (displacement / not a great option with today’s interest rates), or 2) borrow against their home equity (a HELOC or cash-out refi – again, untenable with today’s interest rates).”
“As a debt-free (and typically tax-free) way to tap equity, we are a compelling alternative to these competitors in today’s rate environment – and we offer something that neither of them ever have: we create value for homeowners – we actually increase their net worths. It’s really as simple as helping them unlock the value trapped in their yards for the last 100 years due to zoning. Enabling the land to be used for housing vs. a water-hogging lawn. It’s a win-win.”
Future Company Goals
What are some of the company’s future company goals? Lucido concluded:
“We’re going to invest hundreds of millions over the next three years into low-to-middle-income homeowners across California, changing economic possibilities for families, reducing traffic, and creating housing.”
