In my experience, there has been persistent overcapitalization, mispricing, and loose governance in #proptech. In partnership with the Center for Real Estate Technology & Innovation (special shout-out to Ashkán Z. for making this study a reality) it was time to ask founders some tough questions (that many are afraid to ask) and hear some hard truths about their #proptech VCs and strategic partners (that most probably don’t want to hear). The responses substantially validate many of the conflicts of interest inherent in the proptech ecosystem that I have witnessed over the last five years – a trend I believe is complicating the industry’s growth. 71% of proptech founders were focused on having RE strategics as investment partners; yet 64% of these strategics failed to deliver value. The trend holds true for proptech funds as well – 85% of proptech founders believe their proptech VCs have not delivered. My post unpacks many of the reasons that I believe underpin this unfortunate reality. Advice to proptech founders: do not let short-term gain and convenience distract from the time and effort necessary to build a proper investor syndicate as well as thoughtful and scalable partnerships with RE strategics. Read my post for the deeper dive and complete founder survey results!
In #proptech today, an outsized portion of the investor base comes from the real estate community — a reality Revolution Ventures VP, Alex Shtarkman, believes complicates the industry's growth. On the blog, Alex shares findings from a survey of proptech founders, conducted alongside the Center for Real Estate Technology & Innovation, and advice for building a strategic investor syndicate: https://lnkd.in/gre8T7_K
Andrea Jang
11mo
This is a very disappointing statistic; let’s hold ourselves accountable to partnering startup founders with visionary advisors who truly understand the CRE space. On the flip side, these advisors do need to be appropriately compensated; otherwise what incentive do advisors have?
Antony Slumbers
11mo
4,600 PropTech investors? Wow. That’s many multiples of those worth talking to about PropTech.
Adam Stark
11mo
Excited to read, Alex!
Great to see the research being done, and each of the (massive red flag) negatives you mention I have seen at least once but fortunately are in the vast minority of the companies we speak to, invest in, or watch grow successfully. Was the sample set from some recent accelerator cohorts or something? Or maybe the US market is just much more flush with strategics doing very early stage deals.