In potential, PropTech could become the new industry standard and befitted key in creating and maintaining competitive advantage. However, investing in PropTech requires the industry to have a constant view on innovations. What are the current developments of PropTech in The Netherlands? Here is what you need to know.
Real estate companies now start to embrace PropTech and we have seen ideas started to come to action following the shift from just being inspiring and empowering. Recently a number of major investments in real estate initiatives took place by tech giants like Amazon, Google and IKEA as well as from Softbank – reaching a total of $1.7 billion in Indian hotel booking platform Oyo Hotels – residential brokerage company Compass and digital home buyer Opendoor. Investments that may have pushed real estate companies to rethink their strategy. A necessary step since some of the platforms and technologies will disrupt industries and traditional working practices. I personally believe Artificial Intelligence is one of the major PropTech developments having a massive impact on the real estate sector in years to come.
Artificial Intelligence: the most important global PropTech disruptor
The exponential growth of AI is amazing. According to some experts, it is best understood as the platform underlying ten to twelve emerging technologies, including mobile internet, the Internet of Things (IoT), advanced robotics and autonomous vehicles. This makes AI a key foundation for PropTech providing it an impressive power to disrupt. When taking Moore’s Law as a metaphor – stating that the number of transistors per integrated circuit will double every 18 – 24 months through modern technology – one will see an exponential development line of AI.
PropTech goes beyond technology
PropTech is – next to a modern technology – a strategy for implementing and grabbing grade A opportunities. It is all about the innovation strategy, mindset and culture within organisations to embrace and adopt new technologies and competitive edge. In other words, PropTech is about the future of real estate and the future of your own business. When perceiving it as a strategy one is forcing itself to become more open to partnerships and liaisons with start-ups and scaleups and welcoming inspiration through top (PropTech) events around the world.
Finding the right partners
Finding the best start-ups requires access to data of the best PropTechs in the world. I personally work with UNISSU (subscribe via bit.ly/unissu). Based on UNISSU data, we compared PropTech initiatives in the Netherlands with France and Germany. The Netherlands today registered some 275 PropTech start-ups which is many more than our (big) neighbour-countries. It equals 16 start-ups per million inhabitants in the Netherlands compared to 3,3 in Germany and 8 in France. There hasn’t been done any further research on what these numbers exactly tell us, but it might be that the Dutch cooperate more or generate more business with PropTech start-ups than the ones in France and Germany do. Or the Netherlands is more entrepreneurial and eager to innovate? Whatever the answer is, there is still a long way to go in accomplishing our mission. Whilst proud of the few, we need to reach out to the many.
“It is difficult to see a revolution when you are in the middle of it. We are at an inflection point and if you watch you can already see what is about to happen.” – by TNW
Pitch your company or product and get Awards
It is becoming increasingly important for PropTech start-ups to take centre stage. Even though there are many competitions, the Dutch still love to win and even appreciate ending up in second place, as long as we are noticed. Last years’ MIPIM World Start-up competition the Netherlands had Physee to be awarded second and the year before last the Dutch ParkBee and Chainels became runner-up. Many Dutch start-ups already won international awards like OfficeApp, PowerNest, Amber, Wellsun & OCTO. We feel it will remain highly important to foster the winner mentality within start-ups and therefor enthusiastically promote competitions.
Smart money for PropTech
Increasingly, we see smart money finding its way to PropTech start-ups instead of private equity (funds). We know a couple of large Dutch real estate companies that invest with private money in PropTechs like VORM, Dura Vermeer, Timeless and EDGE Technologies. I personally prefer this smart money strategy over private equity as these investors bring along a large network along beside – the most important thing – business! Those companies implement new technologies within their own projects to set the stage for others to follow. In total €68 million was invested in PropTech within The Netherlands and €52 millions of that amount was invested in 2017 and 2018. Maybe not much compared to the investments in the America’s but we are gearing up.
Our mission: creating a better built environment for everyone. Everyday. Everywhere.
We feel that the time has come to stop talking about PropTech and to take massive action since that is the only way to succeed in PropTech. Start with a big challenge whilst setting small steps. Launch an open innovation strategy in which new developments easily fit. Make it fun and work with the best people within your organisation. In the meantime, keep working on improving the everyday experience of the built environment by unleashing the innovation power of the real estate industry.
How we achieve that?
We aim to realise our mission through empowerment, connecting connections, sharing & gaining knowledge, challenge the status quo and inspire to be different. What is your way of contributing to a better built environment?
Please join us at MIPIM Real Estate NY, let’s talk about PropTech!