Marc Andreessen famously wrote in 2011 that software was eating the world. According to the panelists at Bisnow’s Future of Real Estate event, commercial real estate is not immune to this trend. Real estate e-commerce and finance, in particular, will lead the charge.
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DCI Engineers San Francisco principal Jeff Brink (left) asked Ten-X’s Kyle Ladewig (center) and RealtyShares founder and CEO Nav Athwal what the future holds at the intersection of tech and real estate.
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Kyle spoke about his company, Ten-X, and its aim of making real estate purchases easier by putting the process online. His goal isn’t to simply act as a data subscription service offering online listings for interested parties. Instead, the goal is to make the whole process of buying real estate easier by streamlining and digitizing the entire paperwork cycle people dread when they enter the market. Kyle said the aspiration was to make the process “exponentially easier.”
This desire to make the consumer experience smoother drove Ten-X to rebrand and move away from its old Auction.com name early in 2016. Kyle noted "auction" didn’t create a warm feeling in users or potential users. There wasn’t widespread adoption since the company name was polarizing. Equally important, the company now did more than auctions, so the name didn’t fit strategic goals. After working with the same agency that handled Uber’s branding, Auction.com became Ten-X.
Ten-X’s growth story reflects the evolution of real estate e-commerce. When the company started in 2007, it was used for distressed asset disposal. Success was measured with the Craigslist model in mind; companies generated revenue through aggregating listings. Kyle predicts the next wave will be utilization of data for decision-making.
Getting there will be a journey. He said blaming the user for building the wrong product at the wrong time is no great virtue. The goal is to add value today and respond to consumer needs.
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Nav founded and leads the crowdfunding platform RealtyShares. He describes the company’s business model as a digital analogue to offline syndication, the only difference is that delivery and accessibility is national in scope with RealtyShares. The startup complies with standing regulations and meets with the SEC regularly.
Trulia and Zillow were part of an early wave that made data more accessible. This 1.0 wave then gave way. The companies that made the transaction management process easier would find incredible success in wave 2.0, Nav predicted. RealtyShares was committed to reduce the time and paperwork it took to invest and buy real estate assets. Then the ultimate 3.0 world would seamlessly bring the offline and online worlds together. In this future, a digital retailer can easily find space on the fly for an online brand.
Nav acknowledged the real estate sector was slower to adopt technology. This tendency made RealtyShares focus more on making existing “offline” processes faster and less painful rather than attempt to change user behavior. Equally important, traditionally conservative real estate partners and customers are realizing if they don’t work with tech companies they will be left behind. No one wants to be eaten by disruptive software.
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