REAL ESTATE TECHNOLOGY PERSPECTIVES THAT COUNT

I’m very excited to welcome you to the first installment of the Real Estate Technology Ventures (RET Ventures) blog on Medium. On this platform, we will share updates and information about the Firm, portfolio companies and our team’s perspectives on the biggest trends in real estate technology and the multifamily industry. To start things off, I’d like to outline our vision and why we’re unlike any other VC you’ve ever met.

Billions of dollars have been flooding into proptech in the past five years and with good reason. The $31.8 trillion real estate industry is undergoing a significant digital transformation and the investment community is quickly ramping up their involvement in the space. But proptech is a broad term that, depending upon who you ask, can involve everything from 3D modeling software to listing services for real estate agents. While we invest in all real estate technology verticals, our primary focus is on a market category we call rent tech.

There are currently 40+ million rental units in North America and, according to a MarketWatch report, American renters collectively paid a total of $485.6 billion in rent in 2017, up $4.9 billion from 2016. We believe there is an incredible opportunity for multifamily owners and operators to leverage technology to both improve the resident experience and more efficiently and effectively operate their portfolios. This is the market that we see great potential in, and we’re making bold moves to solidify our position to help create category leaders.

Recently, we announced Real Estate Technology Ventures I, a $108 million fund complex whose limited partners (LPs) include five major multifamily REITs (Aimco, Boardwalk, Essex, MidAmerica and UDR), as well as leading private owners like Starwood Capital Group, Cortland, and GID. That brings us to our most important differentiator: RET Ventures’ network.

Our LPs, with close to 1 million total rental units under management, are the largest single group of institutional multifamily owners in North America to ever back a venture fund. Because of our deep roots within the MF industry, RET Ventures has an unmatched ability to help innovative rent tech companies shorten their sales cycles and gain traction within a market known for its extended sales cycles. Rather than working in hypotheticals such as: “We think multifamily owners would love this technology,” we simply consult with some of the biggest multifamily property owners on the continent. Fortunately, they just happen to be our LPs and thus potential owners of the company we may back. If the product or platform makes a positive impact on our LPs, we know we’re on the right track. It’s a win-win situation: LPs get access to innovative technology that helps them improve their operations and increase revenues, while entrepreneurs are able to leverage our extensive network to leapfrog their competitors.

RET Ventures is more than an industry-backed early stage venture capital firm. We believe we’ve developed a truly unique model that provides tremendous value for LPs and entrepreneurs alike. We’re excited to see what the New Year brings us and hope you join us for the journey.

Inside the rental tech ecosystem, with RET Ventures’ Chris Yip

In proptech, the early bird doesn’t always get the worm.

It can take a lot of time to overcome owners’ reluctance to bet on a new product, and those long sales cycles have been the undoing of many a startup, according to Christopher Yip.

“Historically, there’s not been a first-mover advantage because the worst thing you want to do is deploy a new technology in your portfolio and have the startup fail,” said Yip, a partner at RET Ventures, a venture-capital firm that focuses on the rental sector and counts major landlords Essex Property Trust, Invitation Homes and Starwood Capital Group among its investors. “We think what we’re doing is working, because we can get a group together, vet and validate a solution, and build that solution.”

RET led the Series A round for SmartRent, which went public in a SPAC merger this summer, and has also invested in Amenify, Kasa and Measurabl. The firm raised $165 million for its second fund in June. The Real Deal caught up with Yip, who joined RET after over a decade at private equity giant TPG, to talk about the game-changing opportunities in the rental space and to break down some of the thornier issues that the industry needs to tackle around affordability, sustainability and institutionalization.

There’s been a big shift over the last few years in how Wall Street sees the rental housing asset class.

We’re in the golden age of investment and innovation in proptech, and the institutional rental ecosystem is a good microcosm of that. Participants in the industry are looking at their operations and saying we are behind — in terms of the percent of revenues we spend on technology and innovation and in terms of centralizing business intelligence and process. And how we use that data and analysis to drive decision making, whether it’s on the acquisition and underwriting side, the asset management side, or in property management.

We think there is, frankly, a generational opportunity here....

Read the full article at The Real Deal.