How do companies properly scale the “Tech” in PropTech?
PropTech = Property + Technology
This seems like a simple equation. The red-hot industry that commanded approximately $4B in Venture Funding in 2018 appears to be a black and white combination of Real Estate and Technology — representing an opportunity to digitally transform one of the largest sectors in the world. However, the intersection of these two very different disciplines is not so simple. We’ve seen plenty of potential PropTech pitfalls — particularly on the Tech side — that typically lead to disillusioned end-users and frustrated owners.
For example:
Startup Tech Companies that provide software that digitizes every single analogue process in a building; tons of feature development and little consideration for the user journey.Real Estate firms that hire in-house technical talent or outsourced software development shops to build custom software for their portfolios. They intend to scale to tens of thousands of units without much experience in hyper-scaled technology.Established property solution providers stretching legacy software to capture new aspects of the resident journey.
To modern renters, these platforms seem like the Windows 95 version of their trusted consumer apps.
How do companies properly scale the “Tech” in PropTech?
We believe, at the highest level, the answer is strong technical leadership, balanced with strong real estate leadership. In-house real estate leadership can provide guidance on business models, go-to-market partners, and the most pressing pain points in the industry. Seasoned technical leadership provides the blueprint for developing scalable technical solutions against those pain points, growing technical teams with a strong culture, and, importantly, defining product roadmaps that are both disruptive and familiar for end-users.
To be more specific, successful technology requires seasoned technologists at the helm. Livly’s founding partner, Adam McCombs, provides the technical and product leadership for our organization. Adam recently accepted the award for “Top 50 Tech Leaders” at the Intercon Internet Conference. His decade of scaling software and capturing market share informed all aspects of Livly’s organization.
Below is Adam’s guide to scaling the Tech in PropTech:
1. Hyper-scaled solutions require smart technical decisions from day 1. One of the lessons I learned early in my career is that short-term thinking in software development can lead to long term headaches (technical, data, and design debt). If you’re intending to distribute your product to millions of users, then spend the time and energy to architect an enterprise-grade solution. To get slightly technical, some of these early considerations include building a multi-tenant architecture, and an upfront investment into engagement and retention monitoring to provide reporting of user-behavior.
2. Build an MVP, prove product traction, and then hire senior talent. The right team is a balance of multiple technical disciplines and commands senior technical talent distributed throughout different engineering functions. To be clear, I’m not advocating investing immediately in a full-stack engineering team without identifying product-market fit (I’m a big fan of low-cost minimal viable products). However, I am advocating growing a team with experienced engineers, quality assurance (QA), product managers, and UI/UX designers. A more senior team drives greater decision making, leading to less technical debt and better product.
3. Focus on UI/UX design because user experience will make or break most PropTech companies. In many ways, PropTech is a totally nascent industry solving for age old problems with technology. In other ways, PropTech is generating new workflows for different end user constituents. For example, at Livly, we’ve digitized and unified the disjointed move-in process — an example of solving an age-old challenge — but we’ve also created a marketplace for direct to consumer goods and services — an example of an entirely new e-commerce platform for users. This new workflow requires great UI/UX to encourage engagement and, ultimately, conversion.
4. Choose your platform partners wisely. In the world of micro-services and APIs, today’s best-in-class tech companies are seamless combinations of third-party technology. Having made both good and bad platform partner decisions, I strongly advocate a well-thought-out evaluation process that aligns with your vision and mission. This evaluation process can include bake-offs, demos, evaluations, etc. Spend time to make the right decision.
5. Learn when to turn up the dial on process. In the earliest days of a tech startup — especially in land-grab markets — your technical team needs to develop quickly and can sustain a few small mistakes. Too much process and attention to KPIs can derail innovation and agility. Practicing the right balance of clearly defining your roadmap with flexibility, scrum/agile practices, and solid QA methodologies helps during this phase. As the product scales, your process should scale appropriately. Introduce new process over time.
6. Know when to replace generalists with specialists. It takes generalists to scale a startup in the Seed Stage. As organizations approach Series A and beyond, it takes specialists to make certain that all aspects of your technology are best-in-class: from data management to infrastructure performance, to design. My role as a technical and product leader continuously evolves as we add more teammates; in some ways, I show-up daily trying to replace aspects of my job with more skilled specialists.
Adam’s experience and recommendations highlight the important function that technologists play in building our PropTech future. Prior to Livly, Adam spent eight years at Cisco Systems, Inc. as a Senior Product Manager developing next-generation IP Based Unified Communication Solutions. After Cisco Systems Inc, Adam founded JumpForward (acquired by Vista Equity in 2016), a leading college athletics department Software-as-a-Service (SaaS) platform that consolidated recruiting, compliance, and budgeting on a single platform. His work in multiple, unique industries offers blueprints for tech disruption — yet another benefit for the right technical talent at the top. As we look towards a near future of diverse digital experiences in buildings, we will see more of technology’s best and brightest tackle the PropTech industry. And we’ll certainly need these veteran tech leaders For Property and Technology to experience a harmonious marriage of disciplines.