A friend of mine flipped me this New York Times article today talking about the rapidly growing interest in proptech and about Opendoor – a topic and a company that I have written about many times before on the blog.
Here’s a snippet about proptech:
The hauls are part of a race by investors to pour money into technology for real estate, or what Silicon Valley now calls proptech. Having watched tech start-ups upend old-line industries like taxis and hotels, venture capitalists are casting about for the next area to be infused with software and data. Many have homed in on real estate as a big opportunity because parts of the industry — like pricing, mortgages and building management — have been slow to adopt software that could make business more efficient.
On the Opendoor front, which is the largest/most valuable company in the proptech category, they have now raised over $1 billion. By the end of this year they plan to be in 22 cities across the United States.
Interestingly enough, they have started experimenting with other business models, beyond just buying and flipping homes. They now circumvent agents and sell some homes directly to customers.
But Eric Wu, the CEO of Opendoor, believes that you can’t automate proper advice and so that will remain. The role of agents is simply about to shift from “administration” to that of “advisory”.
I have been arguing for years that the home buying and selling process is ripe for change. And what we are seeing today is really the start of that.
According to the NY Times, real estate tech startups raised $3.4 billion in funding last year. Some firms, such as Fifth Wall Ventures, are entirely dedicated to the space.
This is money betting on change.
Photo by Grant Lemons on Unsplash
Sam Altman has an interesting post up on his blog talking about what he feels is a changing cultural environment in San Francisco (which is where he is based). His argument is that heresies are good for innovation and for moving the world forward. We need people to question established norms. But for that to happen we need environments and cities that encourage it, or at the very least allow it.
Here’s an excerpt:
Restricting speech leads to restricting ideas and therefore restricted innovation—the most successful societies have generally been the most open ones. Usually mainstream ideas are right and heterodox ideas are wrong, but the true and unpopular ideas are what drive the world forward. Also, smart people tend to have an allergic reaction to the restriction of ideas, and I’m now seeing many of the smartest people I know move elsewhere.
In San Francisco he is starting to feel that it is becoming increasingly difficult to have wacky ideas and to work on wacky startups. And for this reason, people are starting to leave the city in search of more open cultures. Openness used to be a hallmark of San Francisco. It was once the epicenter of counterculture. Has that changed?
Here is a final excerpt:
I don’t know who Satoshi is, but I’m skeptical that he, she, or they would have been able to come up with the idea for bitcoin immersed in the current culture of San Francisco—it would have seemed too crazy and too dangerous, with too many ways to go wrong. If SpaceX started in San Francisco in 2017, I assume they would have been attacked for focusing on problems of the 1%, or for doing something the government had already decided was too hard. I can picture Galileo looking up at the sky and whispering “E pur si muove” here today.
Click here to read the full post.
Tramway à Lisbonne by yannick le goff on 500px
This morning I stumbled upon a blog post by a Berlin-based venture capitalist (Ciarán O'Leary) talking about how Lisbon feels like the next Berlin. In other words, it feels like the next great European startup hub.
Here’s his reasoning:
The tech scene is organic – it happened on its own, came out of nowhere. That is much more fun and sustainable than any kind of political or targeted economic strategy.
There are a ton of constraints (funding, local talent base, etc.) so entrepreneurs need to hustle to make things happen. Hustle is good.
Berlin was an economic void, Portugal had a massive economic crisis and Lisbon sure isn’t letting that crisis go to waste.
Entrepreneurship has the real chance to be a center stage act, not a side gig. It’s everywhere.
The city is very, very cool. You just want to be here.
You can have a great life on a startup salary.
Everyone speaks english; everyone is welcoming and open. That matters a lot when you want to attract international talent and funding.
Of course, he’s not the only one calling Lisbon the next Berlin. The EU also named Lisbon “the most entrepreneurial region in Europe in 2015.” Isn’t it interesting what can grow out of economic crisis? See PIGS.
I also don’t think it’s a coincidence that Monocle held its first ever Quality of Life Conference in Lisbon. It’s a testament to O’Leary’s point above that, “You just want to be here.”
And while being “very, very cool” may not seem immediately relevant to creating a robust startup environment, it really is. It may be the most important point. It makes the city a magnet for talent.
Just the other day I was trying to explain Berlin to someone and I used a similar lexicon. I said: “It’s an unbelievably cool city. It bleeds hipness. You will love it.”
If you’re a city, that’s a great thing to be.