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HomeReal EstateThe 13 Most Influential Leaders in PropTech

The 13 Most Influential Leaders in PropTech



Actual Property expertise has traditionally been underfunded in comparison with different massive sectors.  The present panorama is powered by 1000’s of disparate methods, with out an agreed to information commonplace, making any vital modernization of the trade extraordinarily difficult.  For as a few years as I can bear in mind, there was fixed speak in regards to the inevitable disruption of the true property trade, but little or no has modified over the previous 20 years.   Nonetheless, the tide is lastly turning and PropTech has turn into mainstream.  Based on the Middle for Actual Property Know-how & Innovation, investments in PropTech hit $32B in 2021.

As with every trade, significant change requires contributions and collaboration from many gamers, however there’s a small group of people who’ve a disproportionate degree of affect on the way forward for the PropTech trade.  I made a decision to place collectively a listing of the 13 most influential PropTech leaders.  This record is only my opinion.  There was not a survey that I performed, neither is there any science to my evaluation.  The people aren’t ranked so as, however I did group them by classes.

Residential Brokerages

Many organizations publish their very own annual record of probably the most influential leaders in Actual Property, and so they nearly all the time embrace the C-Suite of the biggest residential brokerages (Realogy/Berkshire Hathaway Residence Companies).  I’ve super respect for the executives from each organizations, and so they clearly yield a big quantity of affect over the trade, however each firms function what I’d take into account to be conventional actual property brokerages.  I anticipate that conventional brokerages will proceed to dominate market share for the foreseeable future, and so they present a vital service to hundreds of thousands of shoppers per 12 months.  However, I don’t see both firm essentially altering the trade.  Their fashions are tried and true, and though they may proceed to adapt to adjustments, I don’t see them as pioneers.  Change requires innovation and new methods of pondering, and every individual on this record has demonstrated their skill to carry distinctive fashions to market.

Glenn Sanford (eXp Realty)

Beginning an actual property model isn’t any small feat, and most firms which might be attempting to make a reputation for themselves typically go after the posh market.  In the event that they open lovely workplaces in prestigious zip codes, recruit high brokers with massive bonuses, and rating some ultra-luxury listings, they’ll rapidly (however expensively) construct a model round shiny advertising and marketing collateral.  eXp took a special route.  eXp, which initially launched in 2009, centered their development technique on agent rely and digital workplaces.  They ended 2021 with over 70,000 brokers, representing a 69% enhance from the prior 12 months.  Glenn Sanford (Founder and CEO of eXp Realty) lately introduced that they need to develop this quantity to 500,000 brokers throughout the subsequent 5 years.  Agent rely apart, their enterprise mannequin relies totally round a digital group.  Once you examine this technique to conventional gamers with brick and mortar workplaces in each market that they serve (Realogy’s has approx. 670 firm owned workplaces), there may be vital price financial savings that may be funneled all the way down to brokers and the corporate backside line.

Glenn Kelman (Redfin)

As I’ve written about up to now, I don’t imagine that the trail in the direction of disruption runs by means of fee discounting.  Too many firms have tried and did not construct a sustainable enterprise round decreased commissions.  There may be one exception to this rule: Redfin.  Redfin shouldn’t be a brand new participant (they’ve been round since 2002), however they’ve continued to outpace the market with their distinctive mannequin.  Not like most firms that imagine that listings are king, Redfin initially devoted all of their assets in the direction of patrons.  They constructed a really pleasant UI, and completely dominated in web optimization/SEM.  Based on Statista, Redfin.com was the most well-liked web site for search in 2021 for any web site that was owned and operated by a residential brokerage (18M Distinctive Month-to-month Guests).  Throughout my time working at brokerages that competed with Redfin, it was frequent that our shoppers would inform us that they performed their search on Redfin’s web site.  After increase market share throughout the nation, they expanded into the itemizing enterprise, providing a steep low cost when shoppers purchase and promote by means of them.  Profitability (or lack thereof) has been a criticism that Redfin has confronted, however I imagine that they’ve laid the muse for worthwhile development within the years to come back.              

Robert Reffkin (Compass)

Previously, I’ve questioned Compass’s skill to ever be worthwhile.  This concern stays for me.  Compass, in my view, is a conventional brokerage (fancy workplaces, excessive agent splits, conventional charge construction) which is according to the Realogy and Berkshire Hathaway Properties Companies of the world, however they constructed one thing actually particular which is not like something I’ve seen earlier than them.  Over 8 years, Compass has recruited 20,000 brokers (some got here by means of M/A), opened up a whole lot of workplaces, has gone public, and has turn into a family title.  What actually units Compass other than their friends is their tradition.  Each firm has horror tales, and I’m positive that Compass isn’t any completely different, however from the skin trying in, nearly all of their brokers venture a fierce loyalty like I’ve by no means seen within the brokerage world.  If I had been a gross sales affiliate coming into the trade, Compass can be on the high of my record.  The argument could be made that anybody with $1.15B in money may accomplish this degree of development, however I disagree.  Robert Reffkin (Co-Founder and CEO) has constructed a tradition full of firm satisfaction that’s normally solely discovered within the Googles and Apples of the world.  On the flip facet, I don’t imagine that their present enterprise mannequin is sustainable in the long run, however I do have religion that they’ve what it takes to outlive and thrive.  Their success will likely be tied to their skill to create a real end-to-end working system which might essentially change the trade.  Not like a conventional CRM, the profitable working system might want to reveal true efficiencies for each agent and consumer, whereas seamlessly integrating mortgage, title, and different providers that are a part of a typical transaction.  The query stays whether or not they can proceed to construct market share at their present tempo, whereas pivoting their mannequin to be extra sustainable in the long term.  Going public offered the corporate with extra cash, however it additionally signaled the tip of a relentless circulation of recent capital from VCs.

The Disrupter

Eric Wu (Opendoor)

Many firms have tried to disrupt the residential actual property brokerage trade.  Most of them have both gone out of enterprise or have pivoted to a conventional mannequin.  Most disruptors give attention to fee discount, and repeatedly that technique fails.  iBuying is the only largest change to the residential actual property brokerage trade in a long time.  Eric Wu is the Co-Founder and CEO of Opendoor.  Opendoor launched the idea of iBuying in 2014.  They raised over $1B of enterprise capital earlier than going public in December of 2020.  Since that point, many different firms have entered the iBuyer enterprise, however no different participant has come near their development trajectory.  Opendoor has continued to speed up their development and is by far the biggest participant within the area.  Whereas iBuyers nonetheless represents only one% of all residential transactions, that quantity is poised to develop considerably as Opendoor (and a few of their rivals) broaden into new cities throughout the nation.

Try my prior article on iBuyers right here 

The Kingmakers

Beginning a enterprise is tough.   Many firms with nice concepts fail as a result of they run out of cash.  Capital is essential for all companies, however that’s solely half the battle.  Equally, if no more vital, is buyer adoption.  Think about getting each from the identical place.  Strategic buyers have the potential to almost assure the success of a enterprise (assuming that the options they put money into work), by offering capital together with a built-in buyer base.  There are 2 kinds of Strategic Buyers which might be included on this record.  The primary sort are conventional VC corporations which have raised capital from massive actual property homeowners.  The VC locations bets on behalf of the proprietor, and the proprietor is then more likely to deploy the options all through their portfolio.  The second sort of firms are massive Actual Property homeowners which have fashioned their very own in-house enterprise arm.

Brad Greiwe / Brendan Wallace (Fifth Wall)

Fifth Wall is a enterprise capital agency that focuses on investing in “Constructed World Applied sciences”.  Apart from having a eager eye for putting bets on profitable firms, Fifth Wall is uniquely positioned to crown winners in rising areas partly attributable to who they’ve raised funds from.  Their first fund was centered on the US, and so they raised funds from Actual Property royalty together with Fairness Residential, Lennar, Prologis, CBRE, Hines, Host Lodges, Lowes, Macerich Properties, and Rudin Administration Firm.  Their Fund II took that mannequin internationally, and right now the agency has roughly $3.0 billion in commitments and capital underneath administration, from a fair bigger group of actual property homeowners which incorporates 90+ international strategic companions from greater than 15 international locations. In 2021, Fifth Wall raised $1.1B throughout their funds  The capital and steerage that Fifth Wall offers to their portfolio firms represents solely a part of the worth that they bring about to the desk.  As a result of they’re investing funds on behalf of the biggest Actual Property homeowners of the world, there’s a enormous incentive for these firms to deploy related options from the portfolio firms all through their huge actual property holdings.

Try my prior interview with Fifth Wall right here

Zack Aarons / Aaron Block (MetaProp)

There are millions of VC corporations within the US with many alternative funding theses, however MetaProp is solely centered on PropTech. They’re the biggest international seed fund and so they personal the early stage section. MetaProp has made some huge bets through the years, with investments in over 150 firms.  Much like Fifth Wall, MetaProp additionally raises some funds from strategic buyers who personal a complete of 20B+ sq. toes throughout each actual property asset class.  An funding from MetaProp can almost assure adoption of an answer.  Prior investments from MetaProp embrace HqO, Occupier, Spruce, Bowery, Aspect, and Dongnae.

Jon Korngold / John Fitzpatrick (Blackstone)

Whereas many actual property homeowners are investing in PropTech firms by putting bets by means of a conventional VC, a number of the largest gamers have created their very own enterprise arm and are investing in firms instantly.  Blackstone is a huge in the true property area with a world portfolio valued at $448B.  Blackstone’s holdings embrace nearly each actual property asset class, so that they have an enormous sandbox to deploy many kinds of PropTech options.  A number of the investments that they’ve made embrace DealPath, Zumper, iCapital Networks, and Aquicore.  John Korngold is the World Co-Head of Know-how Investing, and John Fitzpatrick is the Senior Managing Director and Chief Know-how Officer of Different Asset Administration Know-how at Blackstone.  Each play a essential position in figuring out which firms Blackstone invests in, and due to this fact maintain the keys to crowning winners.

William O’Donnell (Prologis)

Prologis, an actual property big who owns nearly 1B sq. of logistics actual property, fashioned a enterprise arm in 2016.  Not solely does their scale present an infinite built-in buyer base, however it additionally offers them with priceless perception in regards to the ache factors and expertise wants of logistics firms. Prologis’s funding thesis is to put money into applied sciences that may profit their firm and their buyer base by creating new income streams, rising efficiencies, decreasing prices, and making constructive contributions to sustainability. As I lined in a previous article, William O’Donnell (Prologis Ventures’ Managing Companion) shared the next perception: “We’re a really thesis pushed investor.  We perceive the place ache factors are, and the way we, as an organization, can discover alternatives to enhance our operations.  However we additionally spend a ton of time with our clients understanding actually what’s driving change inside their group and the place they’re experiencing friction. So with that perception, we exit and discover options that match these alternatives.”  Prologis has made 35 investments in logistics tech, property tech and sustainability. Along with investing in third social gathering firms, Prologis lately launched an EV charging infrastructure enterprise and continues to speculate closely in rising their photo voltaic platform together with different sustainability-focused options for his or her clients. A few of Prologis’s prior investments embrace Flexport, Locus, Flexe and Platform Science.    

Jim Whalen (Boston Properties)

Boston Properties is the biggest publicly traded developer, proprietor, and supervisor of Class A workplace properties in america.  Though Boston Properties doesn’t have a enterprise arm, they’re on the forefront of expertise deployment.  I first met Jim (Chief Info & Know-how Officer of Boston Properties) in the summertime of 2021.  I used to be blown away by his considerate imaginative and prescient on the way forward for the PropTech trade.  What actually impressed me about Jim is how typically his title has come up in conversations that I’ve had with PropTech executives.  I spend a variety of my time assembly with Actual Property and PropTech leaders, and I’ve misplaced rely of the quantity of instances that they’ve referenced his title to me in conversations.  Not solely do the trade gamers respect him, however lots of them inform me that they appear to him for steerage on the place the trade goes.  It will be laborious to seek out somebody extra revered than Jim within the workplace sector.     

The Incumbent

Andrew Florance (CoStar Group)

In relation to actual property information, analytics and on-line marketplaces there may be one firm who guidelines the trade:  CoStar Group.  I don’t imagine that there’s anybody in the true property trade that doesn’t use CoStar or one in every of its’ on-line marketplaces in a method or one other.  CoStar’s information and analytics not solely powers homeowners, buyers, lenders and the brokerage trade, it additionally offers perception to 1000’s of distributors that promote to business tenants.  After dominating business actual property for a few years, CoStar Group lately made an enormous leap into residential actual property with acquisitions together with Homesnap and Properties.com.  CoStar Group is attempting to unseat the present chief in Residential Search: Zillow.  Costar Group can also be within the means of working with REBNY to go to battle with the present chief StreetEasy (StreetEasy is a Zillow firm) within the ultra-competitive NYC residential trade.

Nick Romito (VTS)

VTS offers software program which is utilized by nearly each Business Actual Property proprietor and supervisor within the US.  In 2021, VTS made a number of highly effective strikes to capitalize on their effectively revered title and big buyer base by increasing their product providing.  First, they entered the area which is at the moment dominated by CoStar with the launch of their Market, and rolled out a collection of instruments together with a full CMS, analytics portal, and distribution middle for each area.  Then, they acquired 2 of the biggest Tenant Expertise gamers: RiseBuildings and Lane.  Their present buyer relationships have been opening doorways for them simply as most of the largest business homeowners are making portfolio extensive selections on which tenant apps they’ll deploy.  VTS now has an arsenal of options to do every thing from advertising and marketing areas, to asset administration, to powering sensible buildings.

Royalty

Spencer Rascoff (Pacaso)

Few folks have had as many profitable ventures as Spencer Rascoff.  Just a few of the businesses that he based embrace Hotwire, Zillow, and Pacaso.  Below Spencer’s watch at Zillow, the corporate acquired 15 firms, went public, and dominated the true property search trade.  Spencer formally departed Zillow in April 2021.  After Spencer left Zillow, the brand new management made a collection of missteps with the corporate’s iBuyer enterprise.  These selections resulted in one of many greatest blunders in PropTech historical past, inflicting their inventory worth to drop by 52%.  Whereas Zillow’s new administration group remains to be cleansing up the mess made by their unhealthy selections, Spencer has stored his sizzling streak alive by scaling different ventures that he has invested in.  For instance, Pacaso, which he co-founded in October 2020, was topped a Unicorn quicker than any firm ever. Extra investments that Spencer has made in PropTech firms together with Offerpad, Doma, Flyhomes, Ribbon, VTS, Aspect, EasyKnock, and Radius Agent.

Michael Beckerman (CREtech)

There are a lot of commerce teams, consulting corporations, and different organizations that serve to maintain the true property trade knowledgeable and educated on actual property tech, however none are extra influential than CREtech.  Michael Beckerman is the CEO of CREtech which payments itself as the biggest occasion, consulting, and content material platform within the business actual property tech sector. Michael is among the most effectively revered thought leaders within the PropTech trade.  As most firms switched to digital solely conferences through the Pandemic, CREtech pushed ahead with a collection of stay occasions in 2021.  I attended their NYC convention in October, and was so impressed with their skill to drag collectively all the Who’s Who of the trade right into a single stay occasion.  I comply with Michael and CREtech religiously, and I extremely suggest them to anybody seeking to broaden their data in PropTech.  Study extra about CREtech right here.    

I’m involved in listening to your suggestions.  If you happen to really feel as if I missed anybody, please add your ideas within the feedback beneath.

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