UPDATES IN ENGLISH 2019
Weworked: Money for fixing it
Graphics currently circulating on the net, showing real estate with a “Weworked” logo, are rather vicious. But indeed, this is not an easy time for the company. Suddenly not everything under the brand is shining and flashing any more. The Spacious chain (co-working based on a restaurant), which was bought four months ago, has now been closed. General opinion is suddenly tipping. What was previously (erroneously) hyped into the sky is now being labelled as a false concept along with all other co-working providers. What nonsense! So it’s good that there are also rays of hope: Goldman Sachs has approved a credit line of USD 1.75 billion for the Softbank Group to rescue the Wework Disaster in early December.
Unissu launches TED-Talk-like content
Global proptech platform Unissu starts with a new info format borrowing from the well-known TED talks. A total of 180 free videos will be shot in which experts talk about the future and technology of real estate. The whole thing is sponsored by JLL and M7 Structura.
China as a Blockchain pioneer
It is well known that fromer US President George H.W. Bush caused a scandal by saying that he does not like broccoli. In China, the current ruler Xi Jinping did not speak out against vegetables in October, but in favour of blockchain technology. As a consequence, the crypto markets shot skywards. Europe and the United States must now be careful not to fall by the wayside. See for example here.
Tenants would like to be more digital
Which digital requirements do office tenants have and how fit are office buildings in the CEE region for technological change? A study by CBRE has investigated this. The report is divided into two parts: the Proptech Index evaluates the technological equipment of office buildings in the CEE region and in Austria, focusing on energy and efficiency as well as tenant experience and security. The Proptech Survey analyses the digital solutions and the demands placed on them by office users.
Results include: Already 34% of the respondents in the CEE region use digital functions to order lunch at the office at least once a month, 17% book or check available conference rooms, only 3% reserve their desks. When asked about their wishes, 46% of respondents would like to control environmental factors such as lighting and heating individually and digitally, 33% would like to book or check the conference room and 25% would like to reserve their desk.
More generally, the study also states that reality does not yet reflect the wishes of employees. You can get the Proptech Survey here.
And again: Discrepancy
Another study which comes to the conclusion that there is a gap between desires and reality in the use of real estate technology. This time it’s all about housing companies. 15 major players have been surveyed in “Residential Proptech Effects”. On average, these companies carried out 4.7 pilot projects with proptechs and took a closer look at 16.7 proptechs. 2.5 iof the deas have actually been implemented. In comparison, really large companies (with over 25,000 housing units) looked at more, tried more, but ultimately did not implement any more. Study author Thomas Wenzel of Bell Management Consultants (BMC) concludes that there is a lot of talk about proptech, but the implementation is still quite a challenge.
Deals & Cooperations
WhyHotel Inc. is pleased with a USD 20 million round. The startup says thanks to Hotelapartments, which really is not a traditional hotel, to Harbert Growth Partners, Camber Creek, Revolution’s Rise, Working Lab Capital, Geologists Capital and Mark Nunnelly, according to a press release. Old investor Highland Capital Partners is also among them.
In April, we have been talking about an idea that applies the Airbnb model to expats and other employees who only have to live in another city for a short time. Zeus had received USD 24 million at the time. In a second round, Californian Proptech will now receive a further USD 55 million.
What a name! Hausgold (meaning “house gold”)! The German platform that generates leads for brokers has received a several millions. In itself this is not that exciting, but it is a sign for the digital transformation of the broker business. Investors include Deutsche Bank and ImmoScout24 founder Joachim Schoss.
And once again Signa Innovations strikes. This time, the donor has invested a single-digit million sum in realxdata. French company Ventech was the partner financier.
ABS Capital Partners led an investment in construction data analysis specialist Sevan Multi-Site Solutions. The deal was worth USD 17.5 million.
Hometap offers an alternative to the classic home loan. Investors like this, they put USD 100 million into the US company. Who exactly? Backers included Iconiq Capital as well as existing investors General Catalyst, G20, Pillar and American Family Ventures.
In a few days, IT group Aareon will take over CalCon. CalCon can evaluate the condition of existing real estate and automatically determine renovation costs. It is a spin-off from Fraunhofer.
New venture capitalist
M7 Structura is a new venture capital firm investing in PropTechs. At the end of November, it announced that it would launch its first fund and use it to invest capital in seed and Series A financings.
The M7 Structura team will be led by Conan Lauterpacht. Lauterpacht has experience in developing technology in the real estate industry as an operator and investor in start-ups and established companies. He is a board member of Aprao, a real estate development valuation platform, previously Head of Corporate Venturing at the Altus Group and an active business angel. And who is M7? M7 Real Estate is a pan-European investor and asset manager specializing in multi-let real estate with assets under management of approximately €4.7 billion. The company has also developed its own software, which has been run as an independent company under the name Coyote since 2017.
In Germany there is also a new support programme from Fond-of (actually a bag company). The founder trio Oliver Steinki, Florian Michajelzko and Sven-Oliver Pink, together with McKinsey Company, the law firm Kühn Lüer Wojtek and the High-Tech-Gründerfond, want to start an accelerator programme called xdeck from 2020. Here, too, an early development phase is planned, with PropTechs as part of the target group.
Connectivity as a location factor
The US commercial real estate platform Spacelist has now integrated WiredScore. This may sound moderately exciting, but it is relevant to see how quickly digital connectivity becomes a location factor. WiredScore evaluates buildings internationally on exactly these aspects. In Europe, too, there are already digitally certified properties.
Order lunch via the tenant app
spaceOS launched a Tenant Experience App for Commerz Real in Warsaw in November. It allows employees to do all kinds of things, such as book rooms, report damage to facility management, get support, and via a marketplace even order food from the food trucks coming every day. Access control is also handled via the app. All in all a great thing, but “this is just the beginning,” says Maciej Markowski, CEO of spaceOS. The app is intended to be successively expanded, strengthen the community, simplify communication between landlord and tenant and make the use of the building both efficient and pleasant.
Co-Mix as an asset class
“The Highline at Union Market” is a 32,000 square metre mixed-use new building, a mix of co- and micro living, combined with a wide range of high-end fitness and yoga studios. There is also a co-working facility with a shared infinity pool with barbecue and generous lounge areas. On the ground floor there are small retail areas with offers tailored to the target group. The W5 Group, the investment vehicle of Ralph Winter’s Family Office, based in Miami, New York and Zug, has started to build its INNOVATIVE LIVING portfolio with the acquisition of a newly constructed building in Washington, D.C. with more than 500 beds.
PropTech employees from other industries
Catella has interviewed 283 PropTechs to find out the status quo of the PropTech industry in Germany. The average number of employees at PropTechs currently ranges from 13 to 16, and their average age is 29 years. Only about 8 percent of the companies surveyed have moved since the company was founded. The PropTech hotspots in Germany are Berlin, followed by Munich, Hamburg and Frankfurt.
Another interesting result is that most employees do not come from the real estate industry itself. Not even a third were active in the industry prior to their current job and only 21 percent had completed relevant training, such as a degree in real estate management, before that. 70 percent said they worked in a co-working space or an innovation centre. Here you can download the study.
How much does one earn at a start-up?
And another study on HR in start-ups: VC Earlybird and Kienbaum have investigated how much one actually earns in start-ups, as the image of the exploited employee generally prevails. That’s not true at all. Initially, in the seed and series A phase, founders and non-founders are pretty much the same. After that (Series B and C) things look worse for the founders, they get a lower salary on average. Then the whole thing turns around again and the founders are ahead. In comparison to the old economy, you also have to differentiate according to the degree of maturity of the start-ups. In fact, the average salary at the beginning of the business is significantly lower than in the traditional economy. However, it rises rapidly over time and adapts to the old economy level. You can read the details on Gründerszene.
Deals & Cooperations
Enabling data-based decisions for investors is the goal of Entera, which initially focuses on the housing market. Led by Bullpen Capital and Craft Ventures, $7.5 million has now been invested in the platform. Entera also promises investors significantly more investment opportunities.
Juniper Square is one of the largest investment platforms for commercial real estate. Redpoint Ventures, with the participation of Ribbit Capital, Felicis Ventures and Zigg Capital, have invested $75 million in the platform in a Series C round.
Thing Technologies can look forward to €4.2 million. The financing was led by Proptech1 Ventures and coparion. The existing shareholders also participated.
Reonomy, the data platform for commercial real estate with artificial intelligence, will receive $60 million in a series D. The main investor is Georgian Partners.
Plentific receives $32 million in a series B. AO Proptech was the main investor in the real estate management solution from London. The money will be used to fund geographic expansion in Europe and, from 2020, also in the USA.
Temporary solutions benefit from intelligent access solutions. So it makes sense that Kiwi and kawaloo are cooperating, which they are now doing. Kiwi manufactures keyless access systems, while kawaloo is a marketplace of garages, warehouses, cellars, etc. for temporary storage solutions.
The following organizations have gathered $25 million to invest in Eden, a workplace management platform, as part of a series B round: Reshape had the lead, and Fifth Wall Ventures, Mitsui Fudosan, RXR Realty, Thor Equities, Bessemer Venture Partners, Alate Partners, Quiet Capital, S28 Capital, Canvas Ventures, Comcast Ventures, Upshift Partners, Impala Ventures, ENIAC Ventures and Crystal Towers also invested.
Real way, virtual world
Boring way to work? That can be changed. With Microsoft’s VR glasses DreamWalker you can follow real paths, but with these glasses you can experience a virtual world. The product is still in the development phase, but it already stimulates a lot of fantasies about what you could use it for.
New funds, new money
Brick & Mortar Ventures has launched a new fund with over $100 million in assets. LPs include Autodesk, CEMEX, Ferguson Ventures, FMI, Hilti, Obayashi and Sidewalk Labs (yes, the ones from Google). The creator behind the fund is Darren Bechtel, the offspring of a building contractor clan. His family owns Bechtel, the largest US construction and plant engineering company. The capital is to be invested exclusively in construction tech start-ups.
A new platform, which brings flat seekers and landlords together, wants to have a piece of the German market. badi is already active in Madrid, Barcelona, Paris and London, and now the flat sharing marketplace platform, which wants to deliver better results with AI, wants to gain a foothold in the German-speaking area.
As you know, I love infographics and tables. Here is one about the current ecosystem of ConTechs, nicely divided into individual categories. The well-known Accelerator programs Plug & Play and Colliers International powered by Techstars are now also active in the PropTech area. Have a look at the links, then you can check batches.
Often sellers have properties in their portfolio that cannot be listed on platforms for various reasons. Thus they have a problem with making their offer known, as the boys from findheim believe. So they have created a product for it: Secret Deals – a secure 1:1 communication channel with users who are currently looking for exactly such objects.
Who would have thought: Africa!
No, not everything is happening in New York, Shanghai and Berlin. An entire continent is often forgotten and it could unfold its potential thanks to innovation: Yes, I’m talking about Africa. At the beginning of October, a platform for the PropTech ecosystem of the entire continent was presented in Johannesburg. The specially developed app contains a start-up directory.
A different take on the smart home: In Australia, researchers are working on a window coating that can change based on the seasons. In winter it lets heat in, in summer it is blocked. Die Welt has a short video here.
More investments are expected
Interesting findings from MetaProp’s semi-annual survey: 64% of PropTech investors want to invest even more in the next 12 months than in the last 12 months. This intention has never been so high. Even the start-ups themselves are confident. 80% believe that it will be equally difficult or even easier to get funding. The interviewees also assume that there will continue to be many pitches. That and much more in the Mid-Year 2019 Global PropTech Confidence Index.
Deals & Cooperations
Hm, one could sublet vacant space to one-person-businesses, start-ups or small companies, right? Yes, says Share Your Space and has made it a business model. Commerz Real likes that, so it bought 25% of Share Your Space.
Disperse closed a Series A round. The company was financed to the tune of $15 million. At the forefront was Northzone, and Revolt Ventures, Kindred, and Frontline also participated. Disperse provides solutions to monitor construction sites and progress.
The smart home start-up Level Home receives $71 million from Walmart. Level Home provides digital access solutions by connecting locks with smartphones.
In a Series A round, Building Radar collected €5 million. Participants included coparion, FO Holding, PropTech1 Ventures and SIGNA Innovations. The start-up’s database offers an analysis of new construction projects that are automatically and intelligently researched.
Apcoa Parking and Deutsche Telekom announced a strategic cooperation. Specifically, the Apcoa Flow driveway system is to be linked to Park & Joy (which displays free parking spaces in public and private spaces and can also charge for them) by Deutsche Telekom.
Immowelt is now completely owned by Axel Springer, who have been extraordinarily active in recent weeks. First, the media group acquired the remaining 45% of Immowelt via its subsidiary, the Aviv Group, making it the sole owner. In addition, Axel Springer acquired another French real estate portal – MeilleursAgents. The German group already holds stakes in SeLoger and Logic-Immo.
IPOs: Just don’t hurry!
Whenever a company goes public, there are always rumors. If it’s wework and Airbnb, then this information is even more compelling because it can trigger global hysteria thanks to networks. This is when it’s important not to rush things. As everyone has probably noticed, the IPO of wework could be postponed – although SoftBank would like to buy shares worth US$ 750 million, as the current main shareholder has announced. However, the less than overwhelming figures that wework just had to disclose have not yet convinced the others. Then there is CEO Adam Neumann. Airbnb does not want to rush into action either, the IPO is to be completed in the course of 2020. In the meantime, the company has announced the purchase of Urbandoor, an intermediary platform for medium and long-term B2B tenants.
Google wants to enter buildings
Everyone wants to know more about the behavior of building occupants because that knowledge is assumed to be a raw material for future business models. And Google wants to do the same. With Google Nest, the company wants to position itself as an integrator of various smart home applications. The recently announced intention to launch a Nest Mini Smartspeaker is another piece of this puzzle. It will remain exciting what Google is up to!
Colliers-Accelerator participants published
Ten startups from around the world come together in Toronto to participate in the “Proptech Accelerator” program. The startups of the “Class of 2019” of the “Proptech Accelerator Powered by Techstars” by Colliers have now been introduced. This year, hundreds of applications have been received from over 50 countries. This shows the strong growth of the Proptech sector, which is located at the intersection of technology and real estate. The ten participants of 2019 come from six countries and cover a wide range of solutions, including Quant Valuation and Investing, Crowdfunding, Asset Fractionalization, Machine Learning, Artificial Intelligence, Blockchain and Augmented/Virtual Reality. All participants are briefly described here.
Optimized marketing process for condominiums
The new CoPlannery platform optimizes the marketing process of condominiums and, with its growing database, shows the concrete needs of prospective buyers for apartment and room sizes transparently and in real time to the property developer. CoPlannery has been developed by technology and real estate experts Nadir Benkhellouf (formerly RatePAY and BillPay), Thomas Gawlitta (co-founder of the commercial real estate platform Immobilienscout 24) and Jakob Pupke (media information technologist and tech programmer) and has been launched in August 2019.
This study unfortunately confirms once again that while most real estate companies understand how fundamentally the digital transformation will change things, most still have no idea/strategy how to deal with data. According to the fourth digital transformation study by ZIA and EY Real Estate, most still lack a strategy.
Home office is increasingly tolerated
Women are more open to the “home office” than men, but age does not matter: “digital natives” appreciate the freedom to work at home no more than older respondents do. The majority (57 percent) have no problem with opening the boundaries between work and private life and see the “home office” model as an opportunity. This is the result of a recent survey conducted by Integral Markt- und Meinungsforschung in Austria on behalf of ImmobilienScout24.
The logical consequence of this mindset: Coworking Spaces are popping up like mushrooms. According to Deskmag’s Global Coworking Survey 2019, the market grew by 20% last year. By the end of this year, 2.2 million people will be working in coworking environments.
Deals & Cooperations
RWTH Aachen is the birthplace of HoloBuilder, which was then still called Bitstarts – a solution for documenting construction progress. The company made the leap to the United States and now there are new investors: NRW-Bank, Foundamental and Eon.
While wework wants to make money on the stock exchange (see above) its competitor Industrious was able to book US$ 80 million for itself, which brings the total funding of the coworking start-up to as much as US$ 220 million. Competitor Knotel also receives US$ 400 million – first and foremost from Wafra in Kuwait.
Oyo wants to enter the European market. EUR 300 million has been earmarked for this, 10 million of which has allegedly been used for the acquisition of the Danish data science company Danamica. Oyo is involved in the hotel industry and the Danamica tools could help with dynamic pricing. Competitor RedDoorz from Singapore has received US$ 70 million in a series C. Investors are Asia Partners with Rakuten Capital and Mirae Asset-Naver Asia Growth Fund.
Sensorberg, Jäger Direkt (manufacturer of electrotechnical solutions) and iQ Intelligentes Wohnen (innovative project developer) have agreed to cooperate. Together they want to advance the digital transformation and automation in and of real estate. A joint project will be realized next year. The partnership will be officially launched at EXPO REAL (Sensorberg booth A3.135).
At Lendinvest, people in Great Britain find property financing. Here Lendinvest is the market leader. National Australia Bank likes this, which is why it is investing EUR 216 million.
Brick & Mortar Ventures can look forward to over US$ 97.2 million. The money for the venture fund, which invests in the construction, planning, maintenance and management of real estate, comes mainly from Ardex, Autodesk and CEMEX.
Outfoxed. Clutter buys self-storage provider The Storage Fox for US$ 152 million. Clutter itself offers service and storage, one can have everything picked up from home without moving a finger – well, at most to click.
Technology that automatically tracks what people pack at the supermarket and then charges for it – that’s the business model of Trigo from Tel Aviv. In a series A, Trigo has received US$ 22 million from Red Dot Capital and existing investors Vertex Ventures Israel and Hetz Ventures have followed with US$ 7 million.
Remote transmission, automation and media-break-free data exchange – this is the basis for modern heating and operating cost calculation. Energy supplier inteligy, metering service provider Kalorimeta (Kalo) and software company Domus have agreed to work together to standardize data exchange necessary for this.
Art-Invest Real Estate and BitStone Capital take a five percent stake in Architrave, while at the same time Art-Invest uses Architrave’s LifeCycle Data Room for its 120 managed properties.
Fieldwire gets US$ 33.5 million in fresh capital. Menlo Ventures has led the round, followed by Brick & Mortar Ventures, the Hilti Group and Formation 8. Fieldwire bridges the gap between the office and the construction site by allowing everyone involved in a construction project to track and coordinate work from any device.