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Proptechs: Embracing Instead of Being Scared

Ulrich Schüppler
Editor at Immobilien Zeitung

The number of real-estate-related technology-driven startups continues to grow. The established property companies give newcomers strong support with startup awards and mentoring programs. They try to keep an eye on proptechs to ensure that they won’t torpedo their business models.

 

In the German proptech scene a lot happened in the first half of 2017. The number of young companies trying to revolutionize the property industry with technology-driven business models has grown again. Thus, at the end of last year nearly 150 proptechs were working in Germany. In May the industry blog Gewerbe-Quadrat counted 169 proptechs, at the same time the blog Proptech.de run by the general manager of Maklaro, Nikolai Roth, reported a similar number of young property-related technology companies. The consolidation of letting and sales portals (including temporary letting) which some observers of the industry were afraid would happen at the end of the year has not materialized as yet. In the long term, however, the wheat must be expected to be separated from the chaff.

Evaluation of Data as a Competitive Edge of the “Young Wild”

On the other hand landlords, just like housing companies, have to beware, e.g., the “young wild”. For example, trouble is imminent from the providers of so-called value-added services allowing tenants, e.g., to manage their private documents, communicate with their landlords or remotely control power-consuming devices in their apartments using a smartphone app. But there is also the risk that due to the data traffic generated at some point the app producer will know more about user behavior than the landlord.

Industry experts think that the evaluation of such mass data (big data) could decide on the long-term success of business models. This is because the currently ongoing digital transformation is more fundamental than previous IT waves. In industries like the book trade or the taxi business it has already been seen that digital newcomers can become a great danger to traditional business models, as soon as they have gathered decisive information on the likes and desires of their respective customers. They could then offer services which the established players have never even thought of.

The players rely on a strategy of embracement

But meanwhile the big property companies, established IT service providers and well-known financers rely on a strategy of embracement. The list of sponsors of the startup prizes awarded last year and of other initiatives reads like a who is who of the real estate industry. In dedicated industry meetings the established players make important business contacts available for young companies and at the same time keep track of the fast-lived universe of the proptechs.

 

Startups and technology companies at EXPO REAL

The Real Estate Innovation Network (REIN) will premiere at EXPO REAL 2017. This forum is intended to create a network of international startups, tech companies and the real estate industry.

More about the backgroud on the blog.

You also find information on REIN on the EXPO REAL website.

Direct link to the REIN network.

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