MIPIM REVIEW: Proptech gets an upgrade

The return of Mipim in March 2022 after a two-year hiatus was notable for a number of reasons.

From the point of view of the proptech industry, it meant a chance for hundreds of small start-ups to take centre stage for the first time, hosted in the heart of the Palais des Festivals at the newly created Propel Station. 

Here, with a mixture of keynotes and panels, booths and informal chats, real estate tech leaders were invited to win business with the wider real estate community – and strike meaningful tie-ups with other boutiques.

The overall impression was that tech is now driving much of real estate’s evolution, and providing a prime outlet for industry capital, keen to stay one step ahead.

Pi Lab’s lofty aims
Pi Labs, the proptech-focused venture capital (VC) firm, has just closed its third and largest-ever fund with $90 mln (€83 mln) of backing in an oversubscribed funding process.

But CEO and founder, Faisal Butt, started by talking robots – and specifically, a wall-climbing robot that can paint and plaster. ‘Hausbots is one of the recent proptechs we have decided to fund,’ he explained. ‘It’s a start-up from the UK Midlands, which designs robots for the construction industry. These wall-scaling devices can paint and plaster hard-to-reach areas.

'Yet the outcomes are even more significant. They can replace the need for scaffolding – which is expensive and takes time to erect, and involves a health and safety risk. Also, in times of labour shortage, these kinds of solutions have become essential.’

Pi Labs’ agile robots are perhaps a metaphor for the proptech industry’s increasing capability to solve multiple problems in real estate.

Pi Labs Fund III is aiming to overcome a common criticism of the property start-up world – that its solutions are often limited to specific pain points in specific territories, limiting their ability to be scaled.

‘We really are thinking globally this time,’ Butt underlined, ‘not only because the best start-ups can emerge anywhere, but because we also want to find proptechs that are building global businesses, not focusing on single, local markets.’

In line with this, Fund III is backed by investors from all over the world and is targeting sectors from contech to multifamily, ESG to infrastructure. ‘The global profile of our latest fund’s LPs reflects the surge in institutional allocation towards the proptech sector, and an increased awareness of how start-ups are successfully scaling and solving critical, large-scale industry issues,’ Butt said.

Having already built a portfolio of 60 companies across 15 countries and four continents, he added that the latest fundraise would support the firm's ambitions to almost double its portfolio to more than 100 companies by 2025.

Europe’s rising star
Although the US has, with some justification, claimed to be the centre of gravity for the real estate tech and start-up community in recent years, it is clear that matters are changing. Over the past 15 months, the European proptech market has witnessed a significant rise in VC investments, and many of these success stories were on show at Mipim.

According to data from the Center for Real Estate Technology & Innovation (Creti), a total of €1 bn has been invested across 50 European start-ups so far this year, and a total of €4.4 bn since the beginning of 2021.

In 2022 alone, Clikalia, a Madrid, Spain-based iBuying start-up, received €75 mln from Fifth Wall, Softbank, and Luxor Capital Group while Austria’s PlanRadar raised €64 mln led by Insight Partners and Quadrille Capital for its contech solutions.

Also this year, McMakler, a Berlin-based property brokering start-up, raised a €50 mln round from Warburg Pincus, Baillie Gifford, and Cavalry Ventures.

Other successful fundraises have been achieved by Kayrros, a Paris, France-based advanced data analytics company serving global energy markets, and ParkBee, an Amsterdam-based parking and mobility company helping to monetise underutilised spaces, which raised a €30 mln Series B round.

According to Sergii Stoliarchuk, CEO of Kyiv-based Maxify, capital can’t get enough of the smart side of property – across all territories. ‘If you are going to invest your money in real estate in Central and Eastern Europe these days, two of your best options are green technologies and proptech,’ Stoliarchuk said.

Tech’s role during Covid
The wealth and granularity of solutions on display also showed just why proptech has been making itself indispensable, particularly over the last two difficult years.

‘For many businesses, tech allowed them to continue operating during a challenging time, and has acted as a first step towards creating a digital workforce,’ said Sammy Pahal, managing director at the UK Proptech Association. ‘For others, further along in their journey, it has highlighted critical problems which can be solved using technology and has acted as a driver for real digital transformation.’

After cementing its role in digitising the industry for remote working during the pandemic, the next stage for technology seems to be all about differentiation and competitive advantage.

‘Post-Covid, companies have had to convince people back to the office and have had to create a narrative,’ said Julia Paolucci, managing director, France, at workplace experience platform HQO.

Use of the app skyrocketed during the pandemic, according to Paolucci, due to its usefulness in reserving office spaces and managing access controls – but the tech offers use cases for the long-term. ‘The second driver on the real estate side is creating experiences. We are here to curate the user experience of those spaces.’

Today, HQO is live in 350 buildings across 24 countries, with clients including HPP, JP Morgan and Grosvenor. It also acquired peer Office App last October, to deepen its reach in Europe, particularly in corporate markets.

Other proptechs attending Mipim signalled key wins that align them with the traditional real estate industry. Full-service tenant app, Chainels, said it had signed a major deal with Multi Corporation after the shopping centre owner ran a successful pilot of its app last year.

Chainels is a ‘one-stop solution’ for running a property, said Sander Verseput, the start-up’s chief operating officer and chief financial officer, which is able to reduce paper and plastic waste through its digital diaries and systems.

Meanwhile, a number of US firms, such as proptech NavigatorCRE, were at Mipim to highlight plans to expand business across Europe. The start-up, which has just launched a UK office, provides a commercial real estate navigation tool crunching portfolio data.

‘We have had great success with our corporate clients, who manage significant real estate portfolios. But, of course, many of them also have investments and assets across EMEA and wanted the same solutions for their international properties,’ said Will Young, the firm’s new UK head.

Finally, New York-based proptech VC MetaProp made Cannes the stage to unveil its latest global proptech confidence index. According to the firm’s year-end findings, the outlook is mostly bright. The research showed that 71% of investors globally expect to make more proptech investments over the next 12 months, up from 54% six months ago.

Also, investors expect to invest in at least eight start-ups in the upcoming year, a record high for the Index. In a boost for the sector’s size and increasing maturity, 25% of start-up founders said they expected to hire 20 or more full-time employees in the upcoming year, the highest level seen since the index began in 2016.

However, 73% of start-up founders struck a note of caution, warning that it is likely to be harder or similarly difficult to raise capital in the upcoming 12 months, compared with 58% six months ago.



Latest news

Best read stories