Tech companies entering established industries have a reputation for being disruptive, thanks to the examples of Airbnb and Uber who aggressively forced change in their sector. There are assumptions, therefore, that all tech companies want to disrupt and take over, and subsequently, current industry leaders should feel wary of these new innovators.
However, this is not necessarily the case. In property, many big names in real estate have seized the opportunities that “disruptive” innovation brings by embracing technology and investing in proptech firms. Since 2012, the amount of funding received by proptech firms has increased tenfold. This has shown no signs of slowing: over £45 million was invested into proptech from the 4th to the 11th of September.
Indeed, collaboration between traditional property players and new proptech businesses has been successful in tackling the industry’s biggest pain points. Instead of unseating established property companies, this type of collaboration allows property companies to stay ahead of the tech curve. This is vital for the long term success of the industry.
A perfect example of this is WiredScore: it’s an offering that looks to facilitate, not disrupt. On one side of their market, they empower landlords to better understand and promote their digital infrastructure while simultaneously providing a transparent benchmarking of connectivity for the other side, the tenants.
They’re not the only proptech startup that empowers the industry by creating instant access to relevant data: VTS gives users real time access to their leasing and portfolio data, Urban Intelligence decrease your research time by pulling up the relevant planning policy that impacts your site and Built-ID instantly identify the consultants behind the urban landscape, their past collaborations and their clients.
These startups are amongst a growing proliferation that are focused on removing the barriers to the information behind the urban landscape. There remains a stark disconnect between the built environment and those whose businesses’ depend on it. Making data-driven decisions becomes quicker and easier when accessing the relevant data becomes so. Proptech startups are simply enabling access to this data.
However, this is only possible with industry collaboration. The growing adoption of proptech solutions has necessitated a data-led and collaborative approach to business in commercial real estate. Technology and specifically the harnessing of data are now currencies that companies trade in. Similar to the advent of technology in the financial industry, property companies are finally developing strategies for a data-led approach to business, with large advisory players, such as CBRE and JLL, leading the charge.
As we see an increase in valuable proptech companies, it is imperative that cross-sector collaboration is taken to the next level otherwise the risk of disruption becomes greater. There are great opportunities for the property industry in partnering with technology companies; data is readily available to improve historic software systems, enhance work streams, and increase insight and efficiency.
Where there is opportunity, however, there is also risk. If the industry doesn’t welcome technology with open arms, disruptors can usurp power players, particularly those that weren’t quick to accept technology. On the horizon is the potential for global technology firms, such as Apple or Facebook, to use their data and become part of the property conversation. Google is doing just that with its Sidewalk Lab, planning to develop an area of land in Toronto into a new digital city by “building from the internet up".
The need for cross-sector collaboration and data sharing is now more important than ever, for the property industry to ride the wave of a technology revolution, and leave no room for disrupters.
About Savannah de Savary, Founder, Built-ID
Savannah de Savary graduated from the University of Oxford as an academic scholar in Classical Archaeology and Ancient History and subsequently undertook courses in real estate at New York University. She joined the US property development company Thor Equities in 2013, where she managed Manhattan and Brooklyn-based development projects. After growing frustrated with the technology gap hindering efficiency in the industry, Savannah founded Built-ID: a discovery platform that enables members to discover project inspiration and the professionals behind it and to showcase their work and collaborations to an international audience of potential clients, investors and JV partners.