The tech industry is beginning to take notice…
When TechCrunch runs a piece on Real Estate, you know techies are taking aim. In this piece, Jacob Mullins (a Senior Associate with Shasta Ventures) states:
Over the past months I’ve been mentally mulling over the profundity of Real Estate. Throughout history, real estate has been the most coveted, fought-over, and valuable resource to humanity. Entire civilizations were created, and wiped out, on their level of success in securing it and the access it provided for their people. In the modern age, this has meant the creation of vast amounts of wealth for those who control and monetize it according to their needs, for both countries and individuals alike.
It is refreshing to read that a venture capitalist with a Sand Hill Road address thinks about more than just social media, mobile gaming and daily deal concepts.
So, where does Mullins see the next opportunity?
As I look ahead with the eyes of an investor, I ask myself what is the next dimension of real estate and how can it be most opportunistically exploited?
The rapid advancement of mobile technologies over the past ten years has created a paradigm shift in user behavior, and thus consumer technology products. “Mobile First” is the strategy of the day, and the inclusion of location-aware data layers is the new fabric of real estate – one that blends physical and digital – resulting in a final product that is much greater than the sum of its parts.
We’re at the very beginning, the opportunity is fast upon us to create and own this new Augmented Real Estate, where digital landmarks exist in our physical world. There are a number of companies approaching the landscape with different perspectives.
Problem is, as Coy Davidson pointed out earlier this month, the real estate industry is notorious for being a "digitization" laggard.
If commercial real estate was broken out as a separate bar on the chart above, I bet it would be dead last (this is an industry which still uses the fax machine on an hourly basis....).
I am only aware of one Augmented Reality app for commercial real estate, and I have yet to hear of one person actually using it. Furthermore, I am not sure what problem Augmented Reality for commercial real estate actually solves...
Alternatively, the residential sector is much quicker to test and adapt new technological advancement than the commercial sector. And, I could see where Augmented Reality could be a major play here. For instance, Mullins mentions Digital Breadcrumbs:
Pinwheel and Red Robot Labs are enabling users to interact with physical locations by creating digital tokens and memories, shareable with others. Pinwheel uses location-data as an anchor point for users to recount memories and share photos. For example, I posted a memory and recommendation at Nook, a small café in the Russian Hill neighborhood of San Francisco. As friends go near the location, they will see that I left a “digital breadcrumb” and can read my post and partake in my memory.
Hypothetically, house hunters could use this app to record different homes or neighborhoods they like during a driven market tour and email that link to their agent, so that agent has a better understanding of where they've been and what types of houses they prefer.
While I am still a bit skeptical, Mullins sees a huge opportunity:
The market is young and the opportunity is here to start staking claims in the augmented real estate boom. These companies are the pioneers, but there’s an entire frontier to explore with incredible fortunes to be won.
Sometime the market doesn't know that it needs something, until the solution becomes available. As I mentioned in a recent interview with Duke Long, "[this]category is really what I would consider undefined “Blue Ocean” solutions. This is probably the rarest, but still the most exciting category for many tech-junkies like myself."
At the end of the day, it is good to know folks on Sand Hill Road are thinking about us.
With that said, we can now all go back to reading about Facebook buying Instagram for $1,000,000,000.