Venture capitalists are flocking to real estate tech companies across the globe in search of the next WeWork or Airbnb, but it is not just the startups that are winning.

Last year, both commercial and residential real estate tech companies raised record funds, with investors pouring $2.6B into tech startups through 235 deals worldwide, according to CBInsights research. Major deals such as Homelinks’ $926M Series B fundraiser and OpenDoor Labs' $210M Series D fundraiser pushed the envelope, boosting VC’s real estate tech investment by 40% in 2016 from the previous year.

“There are really no surprises here. This is one of the last frontiers for venture capital and early stage investment. I think most people have recognized that,” MetaProp NYC co-founder and Managing Director Aaron Block said. “We’re also seeing a bit of movement from major players in the space.”

Major Players Making Big Moves, Too

Earlier this month online marketplace Ten-X announced the sale of a majority stake to private equity firm Thomas H. Lee Partners for $1B. The deal signaled a shift in the type of real estate tech companies that are seeing strong investment activity.

Ten-X, unlike the property management and listing startups that are flocking the scene, launched its online platform in 2009. Formerly known as Auction.com, the firm allows users to buy and sell both commercial and residential properties online. The Irvine, California-based company, which has completed $50B worth of property sales since its inception, has raised a total of $141.7M in series funding during that time, according to Crunchbase data.

“For all the talk of commercial real estate being slow to adopt technology, there are dozens of tech companies [that are] relatively new whose products are being used across the industry. One observation is that most tech deployment on the commercial side has been building management tech. We represent a different category of tech,” Ten-X Chief Marketing Officer Rick Sharga said.

As the industry grows increasingly aware of the cost and time-saving benefits of real estate technology spurring adoption and boosting sales, investor interest continues to skyrocket. Late last month, Seattle-based PropTech company Redfin went public after 13 years in business, pricing $21.72/share at market close July 28, 45% higher than its expected $15/share. This resulted in a market cap of $1.73B.

Ten-X, owned by investors Capital G, which is Google’s equity investment fund, and $13B private equity fund Stone Point Capital, may see some accelerated competition moving forward, Block predicts. The purchase of the auction giant’s controlling stake could be both a win and a loss for the tech giant.

“More startups and next-generation innovation will be coming after their space,” Block said. “It’s a double-edged sword that will come after this type of attention.”

Other players already competing with Ten-X in some fashion include online marketplace LoopNet, CREXi and RedFin.

Like Pulling Teeth

Sharga said one reason transaction-oriented tech startups are not as prolific as building tech is because the transaction and finance side of the industry is still fairly archaic. Though property listings and property management handled online has become the new normal in the industry, transaction-oriented aspects of the business are still overwhelmingly handled in person or through paper trails, as was done traditionally.

“It is hard to get them to change that kind of established practice. The more successful they’ve been at doing things a certain way, the more reluctant they are to change,” Sharga said.

Making information as readily available online as it is now was a difficult transition too, Sharga said.

“For many years information has been a closely guarded asset that was driving revenue,” he said. “As that becomes more readily available that does change the dynamics a bit.”