Real estate tech investing has tapered off after a heady 2014. Google's investing arms and Qualcomm are among the most active investors in real estate tech.
After a peak year in 2014, corporate funding and deals to real estate technology startups have dropped off considerably this year.
Investment to real estate tech spiked in 2014, reaching almost $275M, across 15 deals. Notable investments in 2014 include a $90M Series B financing to India’s Housing.com in December 2014, at a $250M valuation; a $50M private equity round in March 2014 to Auction.com, at a $1.2B valuation; and Fundrise’s two Series A tranches, including $31M in May 2014 and $7M in September 2014.
In 2015, corporate investment in real estate tech is projected to drop 75% in dollar terms year-over-year, and deals are on track for only half the deal activity seen in 2014.
That said, this year’s funding trend is still higher than annual investment in 2013 and 2012.
Investment Spike In Q4’14
On a quarterly basis, Q4’14 represented the funding and deals peak. Interestingly, 5 of 6 of the deals done in the quarter were to companies headquartered outside the US, including the Series B financing of Uoko in China and the seed financing of Japan-based Space Market.
After a particularly anemic Q1’15 with only 1 deal and $10M in funding involving corporates, deals and dollars bounced back in Q2’15 with $39M invested across 4 deals.
Series B Dollar Share Hits 50%
A considerable majority of dollars in deals involving corporates and real estate tech went to mid- and early-stage startups.
- Early-stage (Angel – Series A) dollar share was 26% across the six-year period between 2010 and 2015 year-to-date. Most of those dollars went to Series A companies.
- Mid-stage (Series B and C companies) dollar share hit 58%, with a lopsided share of that going to Series B stage companies.
- Finally, late-stage (Series D+) dollar share hit 16%, with 0 dollars invested at the Series D stage.
As the chart below shows, a full 50% of the dollars were in Series B rounds.
Early-Stage Commands 61% Of Deal Share
Deals completed at the early-stage accounted for 61% of deal share. Some early-stage deals we tracked between 2010 and 2015 year-to-date include financings of 3D property-modeling startup Matterport, landlord-tenant collaboration tool Cozy Services, and real estate agent-client matching service HomeLight.
Mid-stage startups took 26% of deal share, meaning more than 1 in 4 deals involving corporates were fundings of real estate tech companies at the Series B or C stages.
Late-stage deals accounted for just 5% of deal share, with all these at the Series E and beyond, and 0 deals completed at the Series D stage.
Most Active Investors
Qualcomm Ventures was in a three-way tie with Google Capital and DMG Information for most active overall corporate investor in real estate tech. Google’s investment arms, Google Capital and Google Ventures, are both active investors in real estate tech despite investing at different stages.
| Most Active Corporate Real Estate Tech Investors 2010 – 2015 YTD (9/22/2015) | |
| Rank | Investor |
| 1 | Qualcomm Ventures |
| 1 | Google Capital |
| 1 | DMG Information |
| 1 | Google Ventures |
| 5 | Mercury Capital |
| 5 | SanomaVentures |
| 5 | Ping An Ventures |
| 5 | Axiometrics |
| 5 | KDDI Open Innovation Fund |
| 5 | Baidu |
Early-Stage Corporate Investors
Qualcomm and Google‘s venture arms are also among the top investors in early-stage real estate tech companies. Two-fifths of the early-stage investors listed below were headquartered outside the US, including Legend Capital in China and Japan-based Nissay Capital.
| Most Active Early Corporate Real Estate Tech Investors 2010 – 2015 YTD (9/22/2015) | |
| Rank | Investor |
| 1 | Qualcomm Ventures |
| 1 | Google Ventures |
| 3 | Legend Capital |
| 3 | Renren Lianhe Holdings |
| 3 | Nissay Capital |
| 3 | Axiometrics |
| 3 | YJ Capital |
| 3 | Circle Ventures |
| 3 | Michigan Economic Development Corporation |
| 3 | Comcast Ventures |
Real Estate Tech By Geography
Nearly half or 49% of real estate tech deals involving corporates were completed outside the US, with more than one-fourth of these occurring in Japan and India.
Since 2010, 51% corporate deals done in real estate tech were to companies headquartered in the US. Japan and India round out the top 3 list for individual countries in which investments were completed. See the chart below for more information.
Want more data on real estate tech companies? Check out our venture capital database below.
Feature image credit: See Modern Britain, https://commons.wikimedia.org/wiki/File:Houses_for_sale.jpg
