PropTech investments are ramping up as of recently. Just this month, PropTech venture capital specialist Fifth Wall submitted a U.S. Securities and Exchange Commission filing revealing it raised $468 million for its second fund.
In fact, data from CREtech shows that PropTech investment tripled to $4 billion in the first quarter of 2019 compared to 2018, but how long can it last?
“There will be winners and losers in this space,” said Ryan Masiello, co-founder and Chief Strategic Officer at VTS. “There will be companies that just fade away because there isn’t a buyer for them, and at the very end someone comes in an picks up the scraps for a few hundred quid, leaving investors that have lost $20M, $30M, $40M.”
Masiello said that the issue with software companies in the PropTech industry is identifying a short-term problem and finding a quick solution, leaving them with no sustainable goal.
One of the biggest tech investors SoftBank agrees with this sentiment. The company’s Vision Fund Director Justin Wilson said that no software company has yet to fulfill an end-to-end solution that investors need.
Despite this, while many of these investors are inexperienced in this sector, they have been successful in others and want a portion of what looks to have great potential.