Glorax Infotech carried out the research of Russian PropTech market
Experts from Glorax Infotech (part of Andrei Birzhin’s Glorax Group) have analyzed Russian PropTech market and concluded that the volume of investment in promising startups for this industry will increase at least 2 times in the coming year. Following the results of 2020 the investments in new technologies for the real estate market can reach RUB 1.5 billion. By comparison, last year investments of specialized funds and developers in Russian PropTech startups exceeded RUB 700 million. The bulk of 2019 investments in Russia came from just two deals, Sdelano and Cherdak companies. Besides, only one exit was made — Occipital Corporation withdrew from GeoCV, the amount of the deal was $7 million.
So far, more than half of PropTech market structure in Russia is marketplaces for buying and renting real estate or providing services in real estate or construction segments. Significant part is occupied by companies in the field of design and construction (Apis-Cor, TraceAir), as well as startups for data evaluation and analysis and collective investments (Aktivo, Geointellect, Habidatum) and companies in the field of ready-made objects management (Wiren Board, Throne).
There is a strong interest in Big Data and AI startups on the Russian market, but there is no clear leader yet. The winner in this race will be the one who creates the most convenient algorithms for analyzing large data, for example, to simplify the interaction of participants in the marketplaces.
In addition, the impact of the pandemic and the development of remote collaboration between companies and customers due to the new requirements for social distancing stimulate the PropTech market towards new segments and niches. This is happening in all segments of the real estate lifecycle, from design and construction to sales and management.
“As there are no one-size-fits-all solutions on the market, this opens up many opportunities for the development of start-ups. This year and next year we will see steady growth in the PropTech industry. Those early investors who will lay the foundation for platforms for interaction between market participants, for creating one-size-fits-all solutions, will be able to take a leading position on the market. We launched the Glorax Infotech accelerator to help the most promising start-ups successfully enter the market and contribute to the digitalization of the real estate market,” said Andrey Birzhin, Head of the Glorax Group, and Director of the Glorax Infotech accelerator.
So far, the volume of investment in Russian PropTech is less than 1% of the global and 1.8% of the European. By comparison, according to PropTech1 Ventures, the compound annual growth rate (CAGR) of investment in PropTech technology in Europe is 45%. While EUR 77 million were invested in European PropTech startups in 2014, the amount of investment money on the market has grown to almost EUR 500 million for the following 5 years (a surge of 550%).