Ask industry experts about Proptech’s global capital and they will answer without exception New York City. Ask about the other high-ranking U.S. proptech cities and the answers always include Boston, Chicago, and San Francisco.
However, for various reasons, proptech startups in the US are growing beyond these cities, some in surprising places. The common factors that everyone shares seem a comfortable one Lifestyle, reservoirs of local talent and easily accessible support systems.
Among the too many locations to catalog here are some of the leaked proptech areas identified by industry CEOs, enthusiasts, and venture capitalists surveyed by Proptech Insider: Atlanta, Austin, Bozeman, Mont. , Charlotte, Dallas, Denver, Honolulu, Miami, Nashville (along with the other Tennessee cities of Chattanooga and Murfreesboro), Pittsburgh, Salt Lake City, Santa Barbara, Seattle, Tampa, Washington, DC and a sleepy little town on the west coast called Los Angeles, particularly around the Venice Beach neighborhood.
One area, Utah’s Salt Lake City-Park City region, has seen growing proptech startup activity for a variety of reasons, said John Helm, executive director of RET Ventures, a technology fund for residential real estate. In 2017, he moved his business and family from the San Francisco Bay Area to Park City.
“I started looking for a place where I could find the fund and where my family could live,” said Helm. “Part of [RET Ventures’] The mandate is to potentially incubate or support companies. One of our criteria was to be in a market where there are good talents who understand our industry. When I layered markets with good tech talent with where I want to live, with a very good quality airport because a lot of our deals are across the country, Park City and Salt Lake came on the top of the list. “
Helmet pointed to Silicon slopes, a 501 (c) (3) non-profit supporting Utah’s startup and technology community, along with the presence of a real estate software company entry in the city of Lehi, as factors driving the region’s proptech growth and moving its fund to the state.
“There are some proptech companies and entrepreneurs with DNA in real estate technology, so we ended up there.”
The network effect of mature proptech startups that spin off or attract young companies is also a factor that affects Zach Aarons, Co-Founder and General Partner MetaProp, call Santa Barbara “a phenomenon. It’s a small town that has Procore, Yardi, Appfolio, Briq, and other Proptech / Contech companies there. The market value in this small, beautiful California beach town is around $ 25 billion. A lot of talent comes out [University of California at Santa Barbara] also to feed the companies. “
Bassem Hamdy, CEO and Co-Founder of Briq, Santa Barbara-based performance management platform for home finance professionals said the city’s size and lifestyle match the margins of the construction technology market and the desire of more mature entrepreneurs like him for work-life balance.
“Proptechs are still a little bit weird entrepreneurship,” Hamdy said. “It’s not like we’re building square, we don’t build Facebook. We’re building a system with maybe 50,000 people to sell it to. So you can be a bit more in one village than in these other rooms.
“The other thing is that building is no nonsense. We honestly don’t want to talk about every startup. At the end of the day, the last thing I want to do is go to a meeting and talk about some bullshit in Silicon Valley. Proptech and civil engineering naturally attract people who really aren’t bullshit. Not that other cities are nonsense, but I just don’t have to network, I don’t want to network, I just want to go. “
Hamdy is from Toronto and said he originally came to Santa Barbara to work as an executive at Procore. He loved the weather and the lifestyle for his family, so after his time with Procore, he stayed with Procore and founded Briq, which now has 120 employees, about a third of whom are based in Santa Barbara and the rest in Toronto and Vancouver.
However, the search for proptech talent for his company extends beyond Santa Barbara.
“It’s hard for us to keep up because when you’re recruiting in San Francisco, [prospects] are like, ‘I’m thinking about construction technology in finance and a company that invented an autonomous spaceship.’ So we say, OK. “
Hamdy believes a town even smaller than Santa Barbara has the answer for Briq.
“We are looking for a second city for another office. We’re away first, that’s what we decided after COVID, but where’s the talent? he said. “Boise, Idaho! Great city, great college with great [computer science], bright kids who just got out of college and don’t necessarily want to leave town. One of the fastest growing states in America. “
Cities that have seen growth in proptech startups typically combine such academic resources with local, state, or nonprofit support for entrepreneurs.
AustinFor example, a number of colleges in a progressive environment with no state taxes and comfortable lifestyles, which is attractive to Silicon Valley VCs and technology companies. It also has a huge home rental market that happens to be home to proptech companies like Icon (which announced a $ 207 million round of funding in late August), Makler.com, RealMassiv, Virtual staging solutions, and Simply renovate.
Likewise Charlotte with companies like Exact group, RealPage investment management, Lemon brew and Lyra Intel, is a slightly under the radar proptech city.
Tariq Bokhari, founder of the Carolina Fintech Hub, which supports technology startups in the Carolina’s largest city, said one key factor driving Charlotte to attract new and established businesses is the Sandbox for regulatory innovationswhich is designed to help all tech areas including proptech.
Coupled with Charlotte’s fine weather and generally low cost of living, it has a broad innovation support system, Bokhari said. “We have a lot of tools in use that are not just fintech, but can actually be used by anyone who has technology in their name. The same people in the banking and fintech worlds who use the innovation regulation sandbox that I’ve been working on for a few years are the same people who use them in health, energy and manufacturing, ”he said. “This also applies to Proptech.”
Perhaps even less visible nationally are Tennessee’s proptech cities: Nashville, home of PASKR, a Contech software startup; Chattanooga with Industry technology, a prefabrication and technology company specializing in large format 3D printing; and Murfreesboro, home of simpliHŌM, which helps home buyers and sellers with real-time information and a concierge service.
Tucked away on LA beach Venice is home to STAY OPEN, an upscale pod hotel startup, with the giant proptech venture capital firm Fifth Wall in adjacent Marina del Rey.
Washington, DC, was not often identified with proptech development, although that has changed. Notable proptech companies in the country’s capital include CoStar, Curbio, Fundraising, Lock (founded in DC, but now headquartered in New York City) and WhyHotel.
Proptech venture capital company Camber Creek DC-based co-founder Casey Berman also listed some of the factors that continue to make the city so hot.
“Some of the largest real estate companies are headquartered here,” said Berman. “They can generate new ideas and are sources of entrepreneurial talent and investment capital. They are also the ideal customer base to help companies get started and eventually grow to a scale. “
“Industry groups like the National Multifamily Housing Council, Urban Land Institute, and International Council of Shopping Centers either have their headquarters here or have regular events in DC,” he added. “These groups are another source of talent, ideas and sales contacts.”
Philip Russo can be contacted at prusso@commercialobserver.com.
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