Singapore tech-based real estate agency Propseller raises $1.2 million seed round

Propseller, a Singapore-based real estate agency that combines a tech platform with in-house agents to close transactions more quickly, announced today it has raised $1.2 million in seed funding.

The round included investment from Iterative; Hustle Fund; XA Network; Rapzo Capital; Lazada co-founder Stein Jakabo; and Dot Property founder Ben Neve. Propseller also said “three undisclosed highly strategic investors” and returning private investors participated.

Propseller’s last funding announcement was in December 2018, when it raised SGD $1 million (about $737,000) in seed funding.

Founded in 2018 and launched the next year, Propseller says its technology platform enables transactions to close more quickly, helping with tasks like property valuations, and reduces standard commission fees to 1% from 2% because the startup’s in-house agents are able to finish more transactions in less time.

The company claims it is currently handling about SGD $75 million worth of properties each year. During the pandemic, tech-enabled services like online dashboards and virtual viewings have allowed Propseller’s agents to continue working with clients.

Despite the economic impact of COVID-19, Singapore’s real estate market is expected to recover relatively quickly, especially the residential sector, because of demand for new condominiums and foreign investment.

Another Singaporean real estate-focused startup that recently raised funding is PropertyGuru. Last month, the property listing platform announced an investment of $220 million from KKR and TPG to expand into new Southast Asian markets. PropertyGuru’s most direct competitor is 99.co, but startups like Propseller, Ohmyhome and Greyloft, which offer agent services combined with tech platforms, all provide an alternative in the Singaporean real estate market.

In a press statement about its investment in Propseller, Iterative partner (and founder of Divvy Homes, a San Francisco-based proptech startup) Brian Ma said, “Worldwide, modern estate agencies are already taking market share at breakneck speeds. In a market like Singapore with high property prices and the need for high quality service, we believe digitalization will be inevitable. We’re excited for Propseller to lead the charge there.”

Propy, a blockchain-verified platform for selling houses, raises funding from Tim Draper

For several years, blockchain technology has been touted as a way to verify the sale of property. Any kind of property. And so entrepreneurs busily began the process of trying to create a startup that could complete a property deal on the blockchain.

One that stood out from the start was Propy, started by Natalia Karayaneva, an experienced, real-world property developer who had subsequently joined the blockchain world. Propy’s other co-founder is Denitza Tyufekchieva (pictured). 

Propy has now raised an undisclosed funding round from venture capitalist investor Tim Draper, best known for his early investments into Tesla, Skype, Twitter, Coindesk and Robinhood. TechCrunch understands this is part of a wider, ongoing fundraise. 

Propy’s platform uses blockchain technology to, it says, simplify the home-purchasing experience and eliminate fraudulent transactions. The idea is to close a traditional real estate deal entirely online. Thus, the offer, signed purchase agreements with DocuSign, secure wire payments and title deeds are all taken care of. Propy claims its platforms saves 10 hours of paperwork, per transaction.

“My vision for Propy is to bring self-driving real estate transactions to the world, with all of the logistics seamlessly executed on the back-end,” Karayaneva said in a statement. “Our platform offers a terminal to observe transactions in real-time, making the process transparent for real estate executives, title companies, homebuilders, buyers, and REITs. With this new investment we are excited to bring much-needed change to the industry, satisfy consumers and empower real estate professionals all over the world.”

But this is not some out-there, wacky crypto-play. Most of the transactions are done in dollars on Propy, meaning it could be used by mainstream users from day one, as it’s able to process wire transfers via integration with a money transmitter connected to 70 banks.

Speaking to TechCrunch, Karayaneva added: “We do not replace lawyers, but rather help them, closing attorney’s share documents with consumers and agents via Propy. With DocuSign integrated, they can sign the documents on Propy and all parties get notified. In the U.S., agents have ready forms in Propy to fill out and they don’t need lawyers in a transaction at all.”

Crucially, Propy has an enterprise play going on here as well. Its platform can provide the back-office system to real estate enterprises with real-time transaction reports and automated compliance.

Draper said: “Propy has the potential to transform real estate, making transactions and titles simpler, more secure, and less expensive through innovative use of blockchain technology. [It] eliminates fraud and makes the closing process more secure, effective and streamlined.”

According to one survey, almost one-fifth of millennials have now thought about buying a home because of the lock-downs induced by the COVID-19 pandemic, meaning that many will be looking for an easy way to transact, especially if it has the ease of use Propy has. 

Propy has some fellow-travelers in the blockchain prop-tech space. ShelterZoom is a Blockchain platform used for virtual and remote collaboration with offices and clients, while StreetWire is a Blockchain-based data service for the real estate industry.

How 3 remote-friendly tech companies plan to return to the office

Six months ago, millions of workers left their offices for the last time without realizing it.

Many would be laid off because of the pandemic, but for those fortunate to keep their jobs, some of their employers still haven’t determined whether they will open their workplaces again.

Some of the biggest tech employers in the United States, like Facebook and Google, have vowed to keep their offices closed until at least 2021, which experts say is a realistic timeframe to develop a vaccine. Twitter went all in, allowing its employees to work from home for as long as they choose, even permanently.

Although the pandemic helped propel the work from home revolution, not all companies are calling it a day on office life just yet. Flexible working is here to stay and is likely to be as important to prospective employees as more traditional company benefits.

TechCrunch spoke with three tech companies that have long embraced flexible work — Auth0, Duo Security and Yubico — about how they adapted during the pandemic and their plans to return to the office.

What’s clear is that although flexible working has been an important part of their culture, it’ll take more than a pandemic to end the office era for good.

Auth0 plans to reopen its six offices

Before the pandemic hit, more than half of Auth0’s employees worked from home. Even its chief executive Eugenio Pace split his time between working from the office and his home.

“Since day one, our employees have had the freedom to do work on their own terms,” said Pace. He said that flexible working helped make his employees more productive, while allowing the company to expand its pool of talent — where more restrictive companies might demand an employee relocate.

“It’s also important to recognize that remote work isn’t for everyone,” he said. But the pandemic made working from the office impossible. Now, the company’s more than 700 employees are working from home.

Opendoor to go public by way of Chamath Palihapitiya SPAC

Today, Social Capital Hedosophia II, the blank-check company associated with investor Chamath Palihapitiya, announced that it will merge with Opendoor, taking the private real estate startup public in the process.

The transaction comes during a wave of market interest in special purpose acquisition companies, or SPACs, often called blank-check companies. They exist as publicly traded entities in search of a private company to combine with, taking the private entity public without the hassle of an IPO.

In this case, the SPAC Social Capital Hedosophia II is combining with Opendoor, a richly-valued private technology company that operates in the real-estate market.

“This is one of many milestones towards our mission and will help us accelerate the path towards building the digital one-stop-shop to move,” Eric Wu, co-founder and CEO of Opendoor said to TechCrunch in a statement. “I am grateful for the continued support from my teammates and shareholders and most thankful for the tens of thousands – and I hope soon to be hundreds of thousands – of families, couples and individuals that trust Opendoor with the largest financial decision of their life.”

Palihapitiya, and his press team did not immediately respond to requests for comment from TechCrunch over phone and e-mail.

Shares of Social Capital Hedosophia II, which trade under the ticker symbol IPOB, were up around 14% in pre-market trading this morning.

According to a notice associated with the transaction, Opendoor will have an enterprise value of $4.8 billion in the deal, including equity value of around $6.2 billion and around $1.5 billion in cash. Social Capital Hedosophia II will provide “up to” $414 million in cash as part of the deal, while a private investment in public equity transaction, or PIPE, will provide another $600 million.

Some $200 million of the $600 million PIPE, or a third, will be funded by investors in the SPAC, with Chamath Palihapitiya himself providing $100 million.

Palihapitiya is not subtle about his plans to use SPACs to pursue his ambitions to be the next Berkshire Hathaway. He famously brought Virgin Galactic to the public markets through a SPAC, which played a role in the $1.7 billion profit that Social Capital made in 2019.

If not acquiring a public through a SPAC, he’s also used personal capital to take majority stakes in businesses. When describing his appetite for acquisitions, he put it curtly to TechCrunch: “I like businesses that build non-obvious data links.”

The rest of the PIPE will be funded by another Palihapitiya group, some private entities like Access Industries, and what a release hyped as “top-tier institutional investors” including Blackrock and a pension plan.

A total of $1 billion in cash is expected to be provided in the transaction. Notably all the cash will flow to Opendoor itself, with shareholders in the company “rolling 100 percent of their equity into the combined company,” per a notice. Along with the transaction, Adam Bain, former Twitter COO and founder of 01 advisors, will join the board, CNBC reports.

Opendoor last raised $300 million at a $3.5 billion pre-money valuation in March of 2019. Of that, $1.3 billion was in equity with nearly $3 billion in debt financing. Investors in the company include General Atlantic, the SoftBank Vision Fund, NEA, Norwest Venture Partners, GV, GGV Capital, Access Technology Ventures, SV Angel, Fifth Wall Ventures, along with others.

Orchard real estate platform raises $69 million Series C led by Revolution Growth

Orchard, the tech-forward residential real estate platform, has today announced the close of a $69 million Series C funding led by Revolution Growth. Existing investors FirstMark Capital, Navitas, Accomplice and Juxtapose also participated in the round, which brings the company’s total funding to $138 million.

Orchard (formerly Perch) launched in 2017 on a mission to digitize the entire experience of buying or selling a home. They focused initially (and still) on ‘dual trackers’, which essentially means that they are home buyers who are also in the process of selling their existing home.

As you might expect, the process of doing both at the same time can be incredibly tedious and, at times, costly. Orchard makes an offer on the buyers’ home with a price that’s guaranteed for 90 days — the company says the vast majority of those homes sell at market price before that 90-day period is over.

Orchard’s product suite also includes tools for searching for homes, title and mortgage.

The search products, in particular, stand out among a crowded space of property search tools. For example, Orchard users can search homes by the room that’s most important to them, putting the Kitchen or the Backyard as the lead image on their listings. Orchard also uses machine learning to suggest more personalized listings.

Orchard cofounder and CEO Court Cunningham had this to say in a prepared statement:

In the same way Amazon has fundamentally changed retail, and Carvana has innovated the car buying experience, Orchard is putting the customer first and modernizing the home buying and selling transaction. We’re thrilled to have a partner in Revolution Growth who has extensive experience working with transformative growth stage consumer businesses that are upending traditional industries. In the year ahead, we’ll be launching an exciting suite of new products and services that further modernize the home purchase experience, while also offering our services to new markets throughout the country.

In the release, the company said it would be using the investment to further expand the product portfolio and grow the team in markets like New York, Texas, Colorado and Georgia, as well as move into new states.

That Whole Foods is an Amazon warehouse; get used to it

Earlier this week, in Brooklyn, near the waterfront, Amazon opened what looks from the outside like a typical Whole Foods store. It isn’t open to the public, however; it’s a fulfillment center.

“Grocery delivery continues to be one of the fastest-growing businesses at Amazon,” the company said in a statement about the location, noting that it has hired hundreds of new employees to aid in its operations. “We’re thrilled to increase access to grocery delivery.”

Americans sort of knew this was coming. Still, the pace at which retail spaces of all sizes are being converted into e-commerce fulfillment centers has become a bit breathtaking. According to the commercial real estate services firm CBRE, since 2017 at least 59 projects in the U.S. have centered on converting 14 million square feet of retail space into 15.5 million square feet of industrial space, and that trend is “absolutely going to continue,” says Matthew Walaszek, an associate director of industrial and logistics research at CBRE.

It has played out fairly quietly to date, save for the occasional headline about, well, Amazon, typically. Last month, for example, the Wall Street Journal reported that the ever-expanding conglomerate is in talks with the largest mall owner in the U.S., Simon Property Group, about converting both former and current JCPenney and Sears stores into distribution hubs from which it can deliver packages.

Amazon needs the space. Meanwhile, Simon needs a tenant that can pay its bills. That’s a tall order right now for many brick-and-mortar retailers that were already under pressure and watched foot traffic disappear entirely with as the country largely shut down in March in response to the pandemic threat.

In fact, despite that Simon and an apparel licensing firm, Authentic Brands, recently partnered to buy apparel retailers Brooks Brothers and Lucky Brand out of bankruptcy (Simon and fellow mall operator Brookfield Property Partners are also in advanced talks to buy J.C. Penney), some reportedly view the moves as a means to buy time as these real estate companies reconfigure their properties to accommodate one anchor tenant.

That exact scenario has already played out at Randall Park Mall in a Northeast Ohio suburb (a mall, incidentally, that this editor occasionally frequented as a teenager growing up in Cleveland).

Once filled with gaudy stores like Piercing Pagoda and Spencer’s Gifts, the mall — which featured marbled columns and was among the world’s largest enclosed shopping centers when it opened in 1976 —  is now the site of an 855,000-square-foot facility filled with mobile robotic fulfillment systems that make it easier for Amazon to more quickly deliver packages.

A local outlet reported its conveyor belts would stretch farther than 10 miles if laid in a straight line.

Yet it isn’t always Amazon that’s snapping up these properties. There are a number of other large e-commerce players that are rapidly expanding their physical footprint right now, along with opportunistic developers betting the U.S. will also focus more on domestic manufacturing facilities in a post-COVID world.

That’s saying nothing of big grocery chains that, like Amazon’s Whole Foods, are increasingly focused on developing fulfillment centers — sometimes right inside a store that sees foot traffic. At an Albertson’s in South San Francisco, for example, customers blithely shop around an automated rack-and-tote system at the store’s center that preps orders for pickup and delivery.

To a certain extent, this ongoing shift in use was inevitable. The U.S. has the strange distinction of featuring 24 square feet of retail space per capita. By comparison, Canada and Australia have 16.8 square feet and 11.2 square feet per capita, respectively.

“We just have a lot of retail — we are over-retailed — so it’s not surprising that properties are struggling,” Walaszek says.

The pandemic has only poured figurative fuel on fire.

Forbes estimates that upwards of 14,000 real-world retail stores will close in the U.S. this year. Meanwhile, during the first six months of the year, consumers spent $347.26 billion online with U.S. retailers, up 30.1% from $266.84 billion for the same period in 2019, according to U.S. Department of Commerce data parsed by the news and research outfit Digital Commerce. That’s up from the 12.7% upswing seen during the first half of 2019.

Retail properties converted to industrial use remains a niche trend when considering there is 14.5 billion square feet of industrial real estate in the U.S. and it won’t transform life as we know it overnight.

For one thing, retail-to-industrial conversions involve buy-in from local zoning officials whose constituents are often concerned about congestion, noise and pollution, among other things.

Retail rents are also significantly higher than industrial rents — more than double in some markets — so it’s “a hard sell to a retail landlord to convert to industrial where revenues aren’t going to be as high,” notes Walaszek.

Still, thanks to a confluence of events — including the runaway growth of Amazon specifically —  both big and small fulfillment centers are beginning to spring up fast.

As Amazon’s first “permanent online-only” Whole Foods in Brooklyn underscores, they may wind up in what seem like the unlikeliest of places, too

PropertyGuru lands $220M from KKR and TPG to conquer Southeast Asia

Southeast Asia’s leading property listing company PropertyGuru is making great strides across the region as it secures a fresh investment of SG$300 million ($220 million), it announced this week.

The proceeds, financed by existing investors KKR and TPG, both buyout titans, will fuel PropertyGuru’s already ambitious push across its main market Singapore, Thailand, Indonesia, Vietnam and Malaysia, where it operates country-specific real estate portals.

The private funding arrived almost a year after the online realtor pulled its plan to list on the Australian Stock Exchange. The company, launched in 2007, was reportedly aiming to raise up to $275 million at the time. And it has been nearly two years since the firm raised $144 million from KKR.

Growth has been encouraging for PropertyGuru in 2019, with a 24% year-over-year revenue growth that beat its own forecasts. The company calls itself Southeast Asia’s largest player, but it’s up against some formidable opponents, including a joint venture set up by close rivals 99.co and iProperty last year. 99.co is itself backed by prominent investors like Facebook co-founder Eduardo Saverin, Sequoia Capital and East Ventures.

Online realtors have been making aggressive expansion in Southeast Asia as the region becomes an attractive destination for real estate investors who want to tap the region’s relatively low investment threshold and high rental yield. Many come from neighboring China, which has reined in property speculation in recent years.

PropertyGuru has kept itself busy in 2020 so far, launching a mortgage marketplace in Singapore and a virtual walkthrough feature for property developers as well as seekers at a time when traveling is unsafe or unattainable. Every month, 24.5 million property seekers use the company’s various products to find homes, which number 2.7 million across the region at the time of its latest funding news.

“Our strong financial performance over the last few years has enabled us to invest aggressively and smartly, to build what is today an integrated and differentiated technology platform that caters to the unique opportunities in Southeast Asian markets,” chief executive Hari V. Krishnan said in a statement.

RealPage acquires real estate IoT startup Stratis

RealPage, a publicly traded full-service property management technology firm with over 12,200 clients worldwide, today announced that it has acquired Stratis IoT,  a startup that provides IoT services to the real estate industry, with a focus on access and energy management tools.

“RealPage aims to become a leading provider in the burgeoning rental property automation market, and thereby create significant opportunity for operators to increase rents, improve sustainability, add operational efficiencies, reduce operating costs and enhance the customer experience for the company’s approximately 19 million units throughout the United States,” said RealPage CEO Steve Winn. “The smart building technology also provides a launching pad for expanded international operations, thanks to Stratis’ existing international presence.”

Stratis is currently installed in about 380,000 homes in the U.S., Japan, UK and several countries in Europe and Latin America. Both Stratis and RealPage target a wide range of the real estate industry, ranging from multifamily units to student housing, vacation homes and commercial real estate.

Image Credits: Stratis

Traditionally, the real estate market wasn’t always the first to adopt modern technologies. That’s quickly changing now, though, in part because of the promise of IoT, which isn’t just a boon to renters looking for modern solutions in their apartments but also represents the possibility of significant cost savings for the industry. RealPage argues that smart technology can generate a revenue lift of $55 per unit, for example, and that’s the kind of saving (and higher revenues) that will push even legacy B2B platforms to modernize.

One area where Stratis stands out is its ability to integrate with a wide variety of third-party solutions.

“Holistic building-wide access and utility management and control are integral to building optimization and the resident experience, which have become increasingly intertwined,” said Stratis IoT CEO Felicite Moorman. “RealPage and Stratis IoT combine two industry-leading, best-in-class platforms to create a powerhouse of control and single-app resident experience for multifamily, student housing, and beyond.”

The two companies did not disclose the price of the acquisition. It’s worth noting that RealPage isn’t a stranger to making acquisitions to bring its technology up to speed. A year ago, the company acquired Hipercept, for example, a firm that provided data services and data analytics to the institutional real estate market. Then, in December, it also acquired Buildium, a SaaS property management solution with over 2 million units under management. In 2019, the company said planned to spend just over $100 million on acquisitions.

 

Property tech startup Habi raises $10M to drive expansion in Latin America

When Brynne McNulty Rojas moved to Bogotá, Columbia four years ago, she encountered a fragmented real estate industry that lacked a central database for consumers to find or compare homes. Rojas was struck by the magnitude of the problem; she was also inspired by the opportunity.

Rojas and business partner Sebastian Noguera homed in on some of the biggest issues in the city’s real estate market, particularly for middle class buyers. They found a market where the average home took 14 months to sell; that figure drops to 10 months for middle class homes. It was a market that lacked price transparency and where sellers used analog tactics like posting a sign in the neighborhood in a futile attempt to attract buyers.

From these problems, Rojas and Noguera founded Habi, a property tech startup with a two-fold approach. The startup founders built a centralized database of residential real estate prices and trends — essentially a multiple listing service — and then used that information to create an automated pricing algorithm to buy and sell homes quickly and efficiently. The company buys, renovates and then sells homes, generating revenue off the margin. It also offers a tool that lets sellers estimate the value of their homes and a database that buyers can use to search for listings. The foundation of its business is its automated pricing technology, which was built using data from its real estate, financial and government partners.

“You can think of it as an MLS plus Opendoor model,” Rojas said in a recent interview. (Opendoor is the U.S.-based property tech startup backed by SoftBank.)

The Bogotá-based startup has now raised $10 million in a Series A round led by Inspired Capital, with participation from 8VC, Clocktower, Homebrew, Vine and Zigg. The round included angel investments from Flatiron Health and Looker. The company has raised $15.5 million to date. 

Brynne and Sebastián_Habi

Habi co-founders Brynne McNulty Rojas and Sebastian Noguera. Rojas is CEO and Noguera is president of the Bogota-based real estate startup. Image Credits: Habi

Since launching in fall 2019, Habi has scaled rapidly — and has even picked up speed during the city’s strict lockdown during the COVID-19 pandemic. Transaction volume has increased threefold since March, Rojas noted.

Rojas said its data-driven approach works, allowing the company to sell a home three times faster than the market average.

The company currently covers all of Bogotá. It plans to use this fresh injection of capital to expand to Medellin this month and eventually to other Latin American markets, according to Noguera, who previously ran the digital transformation at Banco de Bogota and co-founded Marqueo.

The founders also intend to eventually expand Habi’s services to become a “one-stop shop for everything related to the home,” Rojas said. In the long term, this might mean connecting consumers with moving, storage, furnishings and other services.

Join Twilio’s Jeff Lawson for a live Q&A August 25 at 2:30 pm EDT/11:30 am PDT

As we race toward Disrupt 2020, we’re keeping the Extra Crunch Live train rolling with a big entry next week as Twilio CEO and co-founder Jeff Lawson joins us for a chat.

Lawson is well-known in the tech industry for helping institutionalize API -delivered digital services, a business model variant that has become increasingly popular in recent years. Twilio has become a giant in and of itself, worth more than $37 billion today after going public in 2016.

As always, we’ll take some questions from the audience, so bring your best material.

Considering Twilio, it’s position in the mind of API-focused startups everywhere is notable. You tend to hear API-powered startups mention Twilio and Stripe as the two companies that they are mimicking, albeit usually with a different focus: “We’re building the Twilio for X.”

The power of API-driven startups with usage-based pricing and nearly SaaS-like gross margins is something private investors have certainly noticed and are betting on.

But there’s more to Twilio and Lawson than just that one topic, so we’ll also spend time riffing on when is the right time for a private company to go public, how his life has changed since the IPO, and what advice he might have for the super-late-stage startups who can’t seem to get out of the wings and onto the public markets. And, why, odd duck amongst most of the tech-famous, he doesn’t appear to make many angel investments.

Details follow for Extra Crunch members. If you aren’t one yet, sign up today so you can join our conversation.

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