ICE Reddit Mentions | ChartExchange

\*\*TL;DR:\*\* Figure Technology ($FIGR) is the #1 home equity lender in America and 65% of its volume now runs through a marketplace where it doesn't source the borrower, doesn't fund the loan, and doesn't take the credit risk. It just collects a toll. Q2 volume +132% YoY, adjusted EBITDA margin 54.6% (Rule of 150 growth), EPS $0.35 vs \~$0.23 expected. Stock closed yesterday at $35.67, down 54% from its January high of $78. My model says $58 present-value fair, $106 terminal. Four analysts cover this thing. \*\*Positions at the bottom.\*\*
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\## The setup nobody is looking at
Figure was founded by Mike Cagney and June Ou — the guy who founded SoFi and the woman who was its CTO. They spent six years building an automated home-equity origination stack on their own blockchain (Provenance) and got the process from \*\*\~6 weeks and $11,000 down to under 7 days and $1,000.\*\*
That's the whole moat. Everything else follows from it.
Result: Figure did \*\*$12.34B of originations TTM.\*\* Bank of America did $10.4B in \*all of 2025.\* A fintech nobody covers is the largest home equity lender in the United States and it isn't close. Rule of 150 economics has only PLTR and MU ahead of it.
\## The part the market hasn't repriced
Here's what actually changed. Figure Connect launched in June 2024. Partners source the borrower and originate against \*\*presold commitments from institutional buyers.\*\* Figure provides the underwriting and distribution rails and takes a marketplace fee of roughly 3%.
Read that again. \*\*Presold.\*\* The buyer is committed before the loan exists. Figure isn't warehousing it, isn't marketing for the borrower, isn't holding the credit.
Connect volume: \*\*$8M in Q4'24 → $1.6B in Q1'26 → $2.773B in Q2'26.\*\* From nothing to two-thirds of the business in seven quarters.
| | Q2'25 | Q2'26 |
|---|---|---|
| Connect % of volume | 41.7% | \*\*65.1%\*\* |
| Partner-branded volume | 76.6% | \*\*83.0%\*\* |
| Active partners | — | \*\*489\*\* (\~390 in Q1, +102 in Q2) |
| Loan inventory | 31 days | \*\*16 days\*\* |
| Ops cost per $ of volume | 79bps | \*\*67bps\*\* |
| Adj. EBITDA margin | 47.2% | \*\*54.6%\*\* |
\### The three things a lender does that Figure increasingly doesn't
\*\*1. Pay to acquire the borrower.\*\* 83% of volume now arrives partner-branded. Figure isn't buying those leads. Connect volume scales with essentially zero incremental CAC — which is why marketing grew 81% while volume grew 132%.
\*\*2. Fund the loan.\*\* $1.285B of committed warehouse capacity, \*\*$104.9M drawn. 8.2%.\*\* That is 2.5% of one quarter's volume. They pushed $4.26B through a balance sheet they are barely touching, and inventory turns in 16 days instead of 31.
\*\*3. Eat the credit risk.\*\* Securitization collateral grew \*\*68%\*\* last half. Figure's maximum disclosed exposure to those vehicles grew \*\*28%.\*\* The exposure ratio went from \*\*7.57% to 5.75%\*\* — the book doubled and their skin in it \*shrank\*. Plus 30+ unaffiliated securitization buyers, \~15 of them AAA-mandate accounts, 17+ rated deals, \~70% repeat.
\### What that does to the income statement
This is the tell. From FY23 to FY25, \*\*revenue grew 142% against 18% cost growth.\*\* Incremental EBITDA margins ran \*\*82% in 2024 and 91% in 2025.\*\* Adjusted EBITDA margin went from \*\*negative 4% to 54.6%.\*\* Management is targeting \*\*60% by 2028\*\* and at this trajectory that's conservative.
And the mix is visibly rotating inside the revenue line. \*\*Ecosystem and technology fees — the marketplace/platform line — grew +159% YoY while total revenue grew +113%.\*\* They've gone from 5% of revenue in FY23 to \*\*32.3% today.\*\* The high-margin line is compounding roughly 1.4x faster than the business it sits inside.
\### So price it
Everything above is an argument about \*\*which comp set this belongs in.\*\* That's the whole trade. Here's the table:
| Comp set | Multiple | FY26E EBITDA \~$499M | Implied share price |
|---|---|---|---|
| Specialty lender | 6x | | \*\*$14\*\* |
| \*\*Where it trades today\*\* | \*\*16.7x\*\* | | \*\*$35.67\*\* |
| Financial marketplace | 25x | | \*\*$52\*\* |
| Financial marketplace | 30x | | \*\*$62\*\* |
\*(EV plus \~$461M net cash, 246.97M diluted shares.)\*
\*\*Note what that table does not contain: growth.\*\* Those are current-year numbers. Zero credit for Kiavi, zero credit for Connect going from 65% to 85%, zero credit for the second-lien market recovering off a 13-year bottom. Just today's EBITDA at somebody else's multiple.
Specialty lenders get 5–7x because they eat credit risk, funding risk, and cycle risk. Figure is walking away from all three in real time and the market is still splitting the difference. Tradeweb and ICE trade where they trade for a reason, and it isn't that they originate anything.
\*\*The re-rating is the thesis. Everything else is just evidence for it.\*\*
\## Q2 was not close
Reported August 13:
\- \*\*Volume $4.259B, +132% YoY\*\* — above the top of the guide
\- Revenue \*\*$225.6M\*\* vs \~$207.7M consensus (\*\*+8.6% beat\*\*)
\- Diluted EPS \*\*$0.35\*\* vs \~$0.23 expected (\*\*+52%\*\*)
\- Adjusted EBITDA \*\*$119.4M, 54.6% margin\*\*
\- Q3 guide \*\*$4.8–5.2B\*\* — another +17% sequential
\- Net income $87.4M, up from $29.9M
This is the fourth straight quarter the Street has missed. And it's the \*same\* miss every time: \*\*analysts model a \~4.88% take rate. Figure keeps printing 5.30%.\*\* In Q3'25 they modeled 4.83% against a 6.33% actual and got a 31% revenue beat. They have not fixed the model. It is the single most reliable thing about this name.
Meanwhile Figure publishes \*\*weekly volume on its own website, every Tuesday.\*\* A live feed of the revenue line. Only one sell-side analyst even models CLM volume, and their estimate sits \*below\* what the company is already self-reporting. The information is free and public and Wall Street is not reading it.
\## Why the volume keeps coming
30-year mortgage rate is \*\*6.76%.\*\* Applications just hit a one-year low. Nobody with a 3% mortgage is refinancing into that — ever.
But homeowners hold \*\*71.6% of their real estate value as equity, the highest in about 35 years.\*\* If you want that money and you won't touch your first mortgage, a second lien is the only door.
Bank HELOC balances are $287B, down from $600B in 2009 and \*\*growing again for the first time in 13 years.\*\* 1.2M lines opened in 2025, most since 2022, still half the mid-2000s peak.
Rate hikes make this \*better\*, not worse. The lock-in tightens.
\## And then there's Kiavi
Closing 2H: Figure + Sixth Street are paying $717M for Kiavi ($532.4M from Figure). Kiavi is the largest originator of residential transition loans — fix-and-flip bridge financing. \*\*RTL market share went from 2.1% in 2020 to 9.7% in 2025\*\* while competitors lost their warehouse lines and died. Over \*\*$7B of volume, $250M+ revenue, growing 30%, \~40% EBITDA margins.\*\*
Sixth Street takes the loan assets into a JV backed by \*\*$3B+ of forward purchase commitments\*\* — which is pre-seeded demand poured straight into Connect. Figure keeps the platform.
Funded with $600M of senior notes at 8.5%. S&P rated the company \*\*B+/stable and did not notch the unsecured notes down\*\* despite secured warehouse debt sitting ahead of them. The bridge facility was terminated undrawn.
\## The math
My scenario model, weighted:
| Case | What has to break | Value | Weight |
|---|---|---|---|
| Acceleration | nothing — funding just scales | $253 | 7% |
| Bull | ceiling is high, ramp normalizes | $187 | 24% |
| \*\*Base\*\* | \*\*distribution limits reach\*\* | \*\*$88\*\* | \*\*43%\*\* |
| Bear | pricing compresses + de-rate | $27 | 20% |
| Tail | regulators recharacterize the product | $6 | 6% |
\*\*Weighted terminal: $106. Discounted back at 13–15%: \~$58.\*\*
At $35.67 that's \*\*+63% to fair value, +197% to terminal.\*\* Street consensus is $51.57 with a high of $70.
Trades at \~16.7x forward EBITDA. Specialty lenders get 5–7x. Financial marketplaces get 25x+. \*\*Pick a lane.\*\*
BlackRock added 3.36M shares in Q2, up 201%. Druckenmiller's in it.
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\## 🐻 The bear case, because I'm not going to lie to you
I'd rather you hear this from me than from the top comment.
\- \*\*Take rate is compressing.\*\* Net take rate went 4.0% → 3.6% YoY. Gross fell 64bps and only \*looked\* like 40bps because marketing efficiency covered the gap, and that offset doesn't repeat. Even the most bullish outside note on this name says a print below \~3.5% breaks the thesis. \*\*We're at 3.6%.\*\*
\- \*\*Credit turned.\*\* Securitization 60+ delinquency 1.1% vs 0.8% — and that's \*through\* a book that grew 68%, which normally hides it. Nonaccruals went 5.9x. One datapoint. Q3 tells us if it's seasoning or rot.
\- \*\*Buyback is a prop.\*\* $200M authorized in February. \*\*$0 spent.\*\* The stock touched $25 in Q2 and they bought nothing. There is no bid under this from management.
\- \*\*Earnings quality.\*\* \~21% of that $0.35 came from a tax benefit, an asset sale gain, and an MSR mark. Underlying is closer to $0.28.
\- \*\*Dual class.\*\* Cagney and Ou hold \~67–71% of the vote. You are a passenger.
\- \*\*Ten data-breach class actions pending\*\* and the 10-Q says the company isn't aware of any material proceedings. Immaterial in dollars, but it's a posture.
\- \*\*Rates.\*\* Three Fed dissents voted to \*hike\* in July. Unlike Rocket and UWM, Figure has no servicing book that appreciates when rates rise. No hedge. On July 29 RKT went +2.8% and FIGR went \*\*−9.5% on the same print.\*\*
\- \*\*It already ran 43% in three weeks.\*\* At $24.91 this was +149% to fair value. At $35.67 it's +63%. Most of the easy part is gone.
\## Positions
Long common, 7 figures 🐋 No options — IV on this is a crime scene.
If the take rate holds above 3.5% and Q3 volume lands in the guide, the base case is intact and the market is still paying lender multiples for marketplace economics. If the take rate breaks 3.5%, I'm wrong and I'll post the loss.
\*\*Not financial advice. I'm some regard with a spreadsheet and AI.\*\* 🚀
\*Sources: Q2 2026 earnings release (8/13), Form 10-Q (8/14), Q1 10-Q, FY2025 10-K, company weekly volume dashboard, S&P rating action.\*