Can you remember what life in estate agency was like before tech? Before online listings and portals, virtual showrounds and digital marketing? How did we cope without sophisticated CRM systems, data analytics, apps, AI and machine learning?
We’ve witnessed an unparalleled digital revolution over the past 25 years, creating opportunities for tech entrepreneurs and support services to profit immensely from estate agency’s reliance on their offerings.
I’ve seen research that suggests the global proptech market will be worth $120 billion by 2032 – that’s just eight years away. Compared to $27bn two years ago! AI is fuelling this and new start-ups are coming on board by the day.
Following on from my recent article that delved into the accounts filed at Companies House by the UK’s leading estate agents, I’ve now taken a closer look at the accounts of some of those proptech companies supplying the sector. There are literally hundreds so this is just a small selection of those that have a higher profile.
Some are faring better than others, including those – such as Rightmove – who are making almost £200m a year off the back of estate agents’ own data!
I make no judgment on those I’ve listed, they’re simply providing services and solutions that the industry needs; I merely offer this as a starting point for agents to consider how reliant we’ve become on others in our industry. Accounts at Companies House don’t tell the full picture; many have significant cash reserves and some also serve other industries.
Here’s a summary of their revenue and post-tax profit & loss positions:
Some proptech businesses I’ve looked at are fuelled by substantial loans to bankroll their expansion, others may be on the acquisition trail. And surely those offering AI solutions are going to be even bigger winners in the long term?
Nurtur.Group, for example, has just sold off Fine & Country and the Guild of Property Professionals to The Property Franchise Group so it can focus on developing its AI and technology proposition.
The reliance of many agents on external platforms and software, due to the prohibitive costs or complexities of developing in-house solutions, underscores the need for a cautious approach in selecting partner organisations.
I therefore urge you to choose your partners and suppliers wisely, diversifying (where appropriate) so you’re not dependent on a single supplier or platform. We need to ensure that relationships are transparent and mutually beneficial.
Taking a long-term strategic view will ensure we don’t have single organisations dominating the market, profiting from our vulnerabilities, ensuring a future where technology and support services empower the sector, not exploit.
