The New York-based Bowery Valuation has just announced Series A funding in the amount of $12 million to further its technology-powered real estate appraisal platform. According to the announcement, Bowery raised the capital from Builders VC, Camber Creek, Corigin Ventures, Fika Ventures, and Navitas Capital.
Bowery Valuation makes technology that appraisers can use to streamline and make more effective their efforts. A mobile app, for instance, enables users to check off items without having to write down details. As ordinary as this function may sound, it’s surprising nobody else thought of creating tech before Bowery. This app even pulls data from the cloud so appraisers don’t have to surf to find it.
There’s also natural language capability that helps users generate reports. The company narrative says the technology-driven innovations “modernize the appraisal process,” and considering pencils and paper are still the “go to” tools of appraisers… Well, the best innovations are the simplest ones, and Bowery’s team seems to have reinvented the appraisal wheel. Jim Kim, General Partner of Builders VC, and lead investor offered this statement via BusinessWire:
“Bowery brings a whole new way of thinking around appraisals and efficiency when it comes to using technology in the antiquated world of real estate valuation. Builders VC is thrilled to be investing in this team and company, applying a modern mindset and technology to an outdated industry.”
Moving forward, Bowery Valuation is now rolling out a white-label version of the aforementioned app for customers and is expanding outside the company’s original licensing areas in the Eastern U.S. Bowery Valuation has moved out of New York, New Jersey, Pennsylvania, and Conneticut, into L.A. and Chicago, with other markets in coming into range. Co-founder Noah Isaacs, told reporters his company wants to be in either Los Angeles or Chicago in the next few months. Isaacs told reporters Bowery has tripled its customer base since March of 2018. Bowery Valuation is currently focused on multi-family and mixed-use assets, but the company has plans to expand to other commercial properties in 2019, according to Isaacs.
Isaacs and his childhood pal John Meadows, founded Bowery back in 2015 after the duo worked together at the same appraisal firm in New York. Bowery is based on the vast experience the two gleaned from working in the business, and improvements the founders knew would make a difference for appraisers. Joining the co-founders, Princeton economics wiz, Cesar Devers came aboard as CTO before the three got accepted to the startup accelerator MetaProp NYC.
In the past year alone, Bowery has raised a total of $17 million, tripled its client base, revenue, and headcount, and valued more than $3 billion in commercial real estate. Bowery is now working extensively with top-tier lenders and operating in New York, New Jersey,
Phil Butler is a former engineer, contractor, and telecommunications professional who is editor of several influential online media outlets including part owner of Pamil Visions with wife Mihaela. Phil began his digital ramblings via several of the world’s most noted tech blogs, at the advent of blogging as a form of journalistic license. Phil is currently top interviewer, and journalist at Realty Biz News.
Last week, construction finance platform Rabbet announced raising a Series A funding round of $8 million led by Goldman Sachs, QED Investors, and Camber Creek. The Fintech company which was formerly known as Contract Simply – helps companies involved in construction finance to digitize and view documents relevant to a deal.
“Rabbet brings efficiency, accuracy and visibility to the complex construction finance industry.”
Rabbet’s groundbreaking software solves a huge point of pain for construction loan processing by helping to expedite construction draw processing, which saves time and money while minimizing human error in data processing. Currently, these processes are manual and paper-based, making it time-consuming and prone to errors.
This funding round comes as the construction markets are in a big slowdown, a trend which has caused a shift from new developments toward the operations and technology end of the business. Given this “throttling back” environment, many in the business of construction finance are searching for new ways to streamlining and making more efficient all their processes.
Rabbet provides just such a streamlining solution, at a time when Fintech investing is empowering entreprenuers to blaze new trails with AI, machine learning, and VR. RealtyBizNews asked Jake Fingert, General Partner at Camber Creek about the VC firms investment in Rabbet. Here’s what Fingert had to say:
“Given the recent deceleration of the construction market, many in the industry are shifting more of their focus from new development to operations and technology. Rabbet is the leading construction loan software solution, an area ripe for innovation and where many in the space, such as Goldman Sachs, are looking for more efficient ways of doing business. Rabbet’s technology significantly reduces the time it takes to process a loan, which means faster payments for subcontractors and more interest for banks, all while digitizing the workflow to improve compliance and record keeping. Instead of ten days, banks are pushing out draws in as little as two days.”
Rabbet’s platform helps banks, developers, and contractors to perform streamlining functions which are currently manual paper-based functions. The Austin based startup makes use of machine learning to located and extract key information from documents so that data and information can be migrated to PDF or spreadsheet form. At the end of the day, Rabbet technology creates a cross-sharing capability that is not currently available. Will Mitchell, Rabbet’s , CEO and co-founder, told interviewers last week:
“All this information is trapped in disconnected PDFs, spreadsheets, emails. We want to focus on the efficiency, accuracy and transparency that software can bring to this complex industry.”
Goldman Sachs’ construction finance division uses Rabbet’s software for streamlining and modernizing their construction investing operations, according to this Reuters release.
Babbet announced the company will use the new funding to continue to invest in the development of its automation platform, to expand service offerings, and to cultivate partnerships. The company also announced an expansion of its software engineering and sales teams in Austin.
Founded back in 2017, Babbet (Contract Simply) was accelerated with Y Combinator. Since that time the company has seen rapid growth, having improved efficiency for projects sized up to $150 million nationwide.
Phil Butler is a former engineer, contractor, and telecommunications professional who is editor of several influential online media outlets including part owner of Pamil Visions with wife Mihaela. Phil began his digital ramblings via several of the world’s most noted tech blogs, at the advent of blogging as a form of journalistic license. Phil is currently top interviewer, and journalist at Realty Biz News.
In our latest real estate tech entrepreneur interview, we’re speaking with Paul Burke from ColivingCircle.
Who are you and what do you do?
I’m the Founder and CEO of ColivingCircle, a marketplace for finding coliving. I’m a solo founder working on everything from development, design and content to partnerships and customer support.
What problem does your product/service solve?
As coliving grows in popularity among renters we’re seeing more companies enter the space. Because every coliving space is unique – geared towards different lifestyles and interests, there is a need to provide a marketplace that helps consumers find the right coliving space for them.
You previously built RentHoop to connect roommates (interview is here). What learnings from that led you to your new product, ColivingCircle?
We’re actually talking to buyers regarding selling RentHoop which will be the end of a long chapter of my life that occupied most of my mid-20s.
As a first-time founder, I didn’t have the context or experience to know how to best build a product, evaluate an industry, allocate resources or manage a team. It’s all trial by fire when you’re just starting.
Over a span of a couple of years, I began to develop a level of objectivity that helped me see the industry from a different light. While the need for a product like RentHoop was, and still is, massive, there’s a reason people still use Craigslist, primarily, for finding roommates. It’s a tough business to monetize until you achieve density, scale and products people will pay for. Those things typically require a good amount of capital, especially for a low-velocity product like finding a roommate, room or sublet.
My goals this time around are very different than they were for RentHoop. For ColivingCircle, I am not looking to build a ‘startup,’ one optimized for user growth and raising money from VC’s, but a business with limited overhead that seeks profitability and can be self-sustaining.
What are you most excited about right now?
Coliving is “the antithesis to social distancing” as Rolling Stones Magazine put it. In the short-term, many coliving spaces are taking a hit.
The positive is that many people who are sticking it out in coliving spaces are able to experience community in a wonderful way. From some of the interviews I’ve done on the ColivingCircle podcast, we’re hearing about how people don’t feel isolated or lonely because they have others around.
We’re going to see demand for coliving explode in the next year and enter the mainstream.
What’s next for you?
Continue to advocate for the industry and connect people with a coliving space near them. We already have about a dozen partnerships with coliving spaces in the United States so we’re excited to officially launch!
What’s a cause you’re passionate about and why?
I’m half-Egyptian and those roots are extremely important to me. My family and I took a trip to Egypt this past September and we got the opportunity to work closely with a boys and girls orphanage. In the last week we were able to purchase them a school bus with the help of some family and friends. We continue to support them so they can receive an education and the opportunity to live out their dreams.
Thanks to Paul for sharing an update to his story. If you’d like to connect, find him on LinkedIn here.
We’re constantly looking for great real estate tech entrepreneurs to feature. If that’s you, please read this post — then drop me a line (drew @ geekestatelabs dot com).
90 percent of the real estate professionals reading this report will understand that the leveraging of property technology (PropTech) to research, buy, sell and manage real estate, is the future. This report is to help the other 10 percent and to validate what most industry professionals already know.
The PropTech 101
Before diving into the deep end of PropTech investing, it’s important
to define what this new wave of PropTech incorporates. Advancements in the way
real estate professionals process data are not new, you see. However, the
breaking technologies that have powered up almost all business are set to take off toward a new paradigm. Artificial
intelligence (AI), Big Data analytics, Virtual Reality, and Augmented Reality, and more advanced forms of computer-aided
design (CAD) are the main areas of the innovative shift. 20 years ago such
technologies were considered science fiction, but today PropTech startups are
addressing everything from fixing a tenant’s leaking faucet to industry
insights and more. Make no mistake, PropTech is not only here, but it’s also
becoming as indispensable as the telephone. If you are among the 10 percent, who think your real estate related
business can operate without these new technologies, imagine running your store
with no phone.
PropTech Investment Barometer
The latest Global PropTech Confidence Index published by New York VC
firm MetaProp reveals the robustness of the investor segment. The report also
frames the overall maturity of the startup ecosystem from data gleaned from
over 500 investors across 1,600 startups. The twice-per-year index also shows
that 60% of PropTech investors surveyed plan to invest even more in 2019. With
2018 seeing the most investment ever, this vote of confidence is a significant
litmus test. Even with a mixed bag of geo-policy and economic factors weighing
on investors, confidence in the segment still runs very high. There are several
reasons for this including the quality of investment pitches VC receive. The
“maturity” of innovation is reflective of the overall quality advancements
innovators are creating. Take so-called “smart buildings,” as a for instance.
In a report for Forbes, real estate innovator, and entrepreneur,
Angelica Krystle Donati predicted coming investments in segments aligned with
“direct synergies on the concept of “smart cities,” such as AI, IoT, cybersecurity, mobility, and e-commerce.” Her
prediction is in line with the more than one-third of major investors who feel
smart building tech will take off. The PropTech innovations are like a snowball
set to roll over and snatch up anything in their path. The investment landscape
mirrors what happened in the mid-2000s with internet technologies and phones.
Maturing Globally
Then there is the revelation that PropTech sector is maturing. This
is best illustrated by the fact there is a sharp division in winners and losers
in the space. Just as was the case in the Web 2.0 era, the cream of innovation
and value is rising to the top, while the rest end up in what became known as
“the dead pool” of technology startups. The best become profitable, and the
useless, underfunded, or ill-planned startups end up bankrupt. In such a
metamorphosis we can expect these big winners to make the next logical step –
to become international companies.
News from Italian proptech startup Casavo is a subtle indicator that
PropTech winners will scale globally. The with the goal of decreasing the time
it takes to sell a property just snagged a €7 million Series A round from
Berlin-based Project A Ventures, Picus Capital, 360 Capital Partners, Kervis
Asset Management, Boost Heroes, alongside Marco Pescarmona and Rancilio Cube.
At its core, Casava creates a simplified transaction process leveraging the Instant Buyer
(iBuyer) model in combination with an s automated valuation engine. The
valuation/offer process is greatly streamlined, with the seller receiving a
full cash payment with a month. Casavo’s
automated valuation engine factors in 70 plus variables to provide the seller
with a fair market value for their property – and a buy offer is presented.
There are many other examples.
Now, let’s say the
Casavo model takes off across Europe. This will create a lot of competition,
and things like the negative aspects of the iBuyer model will squeeze Casava
and other early adopters. What will fill the value void? This is the big
question. You see, the downside of iBuyer models are the losses suffered
on account of commissions and discounts built in. The quick and easy sale is at
the expense of the seller and not the agents or intermediaries. Here’s where
the competition comes in, a competition that will be won by big players like
Zillow and the other U.S. players. The end of the story will be innovators like
Casavo innovating and finding an exit runway with a huge profit, or failing to
innovate and going bankrupt.
Invest in Collaboration
Modernizing the transaction process technologies like AI, AR, CAD,
and VR are allowing potential buyers to visualize without even visiting the
property. The homebuyer can even us CAD and VR alongside Big Data analytics to
check demographics, tax incentives, neighborhood statistics, and local
amenities without ever leaving their reclining living room chair. Agents can
use intelligent machines and big data to streamline
much of the traditional transaction process further, and even match
investors to a property type, etc. The list of potential PropTech uses is as
long as the list of tasks agents, buyers, and sellers have in front of them. At
the end of the day, PropTech relieves many pain points encountered by both real
estate professionals and potential buyers – and investors know this. That’s why
the investing trend is the barometer for PropTech adaptors.
Finally, this report from KPMG in 2017
reveals how real estate professionals can integrate PropTech and bride the gap
between the “built” and the digital environment. The research confirms that Big
Data and analytics will reap the biggest rewards for adopters, but the IoT that
will power smart buildings comes in second, followed by AI innovations. Those
surveyed also validate that streamlined process and improved decision making
are at the top of the list of benefits real estate businesses will receive from
these innovative technologies. What most striking about this 2017 study is the
fact that collaborative PropTech ventures are the key to success in adaptation.
What this means is, “build your own” solutions will no longer work, not even
for the huge players like Zillow. In the end, a collaboration between real
estate and technology players will be the future. Almost half of the leading
real estate decision makers surveyed by said they would collaborate with a new
or existing supplier of PropTech.
Phil Butler is a former engineer, contractor, and telecommunications professional who is editor of several influential online media outlets including part owner of Pamil Visions with wife Mihaela. Phil began his digital ramblings via several of the world’s most noted tech blogs, at the advent of blogging as a form of journalistic license. Phil is currently top interviewer, and journalist at Realty Biz News.
[Note from editor: The “Mastermind Showcase” highlights companies and news from members of the GEM. Today’s showcase: Second Century Ventures.]
Second Century Ventures is the strategic investment arm of the National Association of Realtors, the largest trade organization in the US, and invests in technology companies across real estate, financial services, banking, home services, and insurance. Dedicated to seeing the entrepreneurial spirit of real estate thrive, keeping the agent at the center of the transaction.
Docusign was one of its very first investments back in 2009 and has since grown to a market cap of more than 40 billion.
Second Century Ventures launched the REach accelerator in 2013, a nine month, highly selective program that provides companies with capital, meaningful partnerships, and and resources to fuel growth. They recently announced its 2020 class which represents a market capitalization of more than $400 million.
What we like: With ties to NAR’s 1.4 million members, deeply experienced executives, and a strong pool of mentors, there is no VC firm that can match its depth of industry relationships across real estate and adjacent industries.
VTS, a New York-based company has announced they’ve raised an additional $90 million in Series D funding led by Brookfield Ventures. In total the startup has gleaned $187.4 million since it’s entry seven years ago. According to the company, this funding round makes VTS the largest software venture in CRE history.
According to the Wall Street Journal, the Series D funding values the company at over $1B, which makes one of the 20 or so “unicorn” startups valued at $1B or more.
Other investors in this round included GLP and Tishman Speyer, as well as Fifth Wall, along with others. VTS’ Saas business model innovation has had revenue growth of 70% year on year in 2018, according to the company’s press. VTS says its software empowers landlords to convert leads into leases 41% faster with data-led strategies. Josh Raffaelli, Managing Director, Brookfield Ventures, offered this:
“VTS has been one of the most impactful technology platforms we’ve incorporated into our organization and we are excited to be playing a part in their future. VTS’ market-leading technology platform has transformed the way the industry operates, and we’re incredibly excited to partner with them in this new capacity.”
Back in 2016, VTS and competitor Hightower merged to grow square footage of office, retail, and industrial assets managed from a combined 2 billion to 10 billion by the end of 2018. The proptech company now boasts of over 35,000 users which include brands like Jones Lang LaSalle and Blackstone. Nick Romito, Co-Founder, and CEO of VTS offered this via press release:
“There’s no truer validation as a founder when your customers invest in your product and we’re thrilled to welcome Brookfield Ventures and GLP as our partners, alongside return investor Fifth Wall, as we enter the next phase of growth. This funding will enable us to accelerate the pace at which we build the best technology for commercial real estate landlords, brokers, and tenants, as we arm them with the sophisticated solutions they need to win in a rapidly changing environment.”
The new funding will be used to enhance the VTS platform, according to the company press. VTS also plans to accelerate the launch of its commercial real estate (CRE) marketplace, Truva, slated to go live later this year.
Phil Butler is a former engineer, contractor, and telecommunications professional who is editor of several influential online media outlets including part owner of Pamil Visions with wife Mihaela. Phil began his digital ramblings via several of the world’s most noted tech blogs, at the advent of blogging as a form of journalistic license. Phil is currently top interviewer, and journalist at Realty Biz News.
[Note from editor: The “Mastermind Showcase” highlights companies and news from members of the GEM. Today’s showcase: MetaProp.]
Founded in 2015 by Zach Aarons and Aaron Block in New York, MetaProp is one of the world’s most established venture capital firms focused exclusively on the prop tech sector. They invest at the early stage, with check sizes from $25,000 to $3 million.
The portfolio includes more than 120 companies, which have raised more than $2 billion and employ 1,500+ people. PadSplit, Briq, and HqO are among those that have collectively exceeded $2 billion in funding with 8 successful exits. With over $110 million dispersed over three funds, they are seeking to raise $200 million for their fourth and largest fund, the MetaProp Growth Select I, to invest larger checks in later-stage companies.
MetaProp’s 22 week accelerator program and eight week pre-accelerator program are operated in partnership with Columbia University, and provide access to the RE200 mentor network of over 80 C suite real-estate professionals along with other benefits.
Represented in the GEM: Aaron Block
What we like: With over 15 billion square feet of property, MetaProp’s limited partners often serve as crucial initial customers for portfolio companies in need of distribution to fuel growth. It’s great to see its partnership with Enterprise Community Partners to help address the housing affordability crisis
[Note from editor: The “Mastermind Showcase” highlights companies and news from members of the GEM. Today’s showcase: Thomvest.]
Thomvest Ventures has Invested more than $500M across 53 companies since its founding in 1996. The firm is fully capitalized by Peter Thomson; Peter and his family own a majority stake in the news and information services company Thomson Reuters. Thomvest invests across all stages, from seed to growth equity and is focused on four primary verticals: fintech, proptech, cybersecurity, and marketing technology. Notable portfolio companies in the proptech vertical include Glide, Blend, Ribbon, PeerStreet and SoFi.
Thomvest’s market map of 220 real estate companies is a great visual resource for those first exploring the world of proptech. In addition to the venture group, Peter Thomson also runs a single-family rental portfolio called Thomvest Properties, which is based in Dallas, Texas.
Represented in the GEM: Nima Wedlake
What gets me out of bed:
Working in venture capital requires constant learning and an openness to new ideas, which makes the job interesting and fulfilling. Most importantly, we have the privilege of working closely with fantastic entrepreneurs on a daily basis. Being a small part of their journey is exciting and rewarding.
What we like: Its deep fintech roots–and more specifically alternative-financing–makes Thomvest an expert in one of the most compelling areas of innovation in real estate.