What are the different CRE tech firms Archives

You decided that you want to focus on proptech (aka CRE tech), but you don’t know who should be in charge of your proptech strategy. As someone who’s run CRE tech for a real estate firm and sold software as a CRE tech vendor, I can help you decide. Here’s my two cents. Hint: it’s not IT.

Ideally, your CRE tech decision-maker should be in a role that drives revenue for your organization. In a property management firm, this means the Head of Marketing (or Revenue Management). With owners, this means either your Chief Investment Officer or Head of IR/Capital Formation. In a tenant rep organization, this means your Head of Client Solutions.

Otherwise, your proptech strategy may as well have the same priority as deciding what dishwasher to put in your common area kitchen… very few will care. Those who do will care passionately, for sure. But it won’t drive the success of your CRE business.

The more I’ve seen of CRE owners’ cultures, the more I’m convinced that investments (which includes asset management) or IR would be the safer space for a head of CRE tech to flourish. The unfortunate reality is that many CRE owners consider non-deal roles to be “back office”. For CRE tech to influence your firm strategy, your decision-maker must be on the revenue-generating side of the firm.

If you’re large enough, then you should 1000% hire someone specific to this role. My current favorite title for this role belongs to Ilene Goldfine, Chief Digital Strategy Officer at Hines. You will also see this title framed as a Head of Innovation or similar.

Want to learn more about who should be in charge of your proptech strategy?

Check out my Substack on this very topic here.

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I hope you use your newfound knowledge on how to choose commercial real estate tech to improve your processes. Let me know if you have any questions or edits. I always love hearing from you.

After seeing so many VCs post versions of these “CRE tech market maps”, I couldn’t help but think to myself, “Are you kidding me? What real estate firms truly have the time and budget for all of these tools?!” Okay, fine, the big guys do. But we’re talking about an industry comprised largely of Davids with a small number of Goliaths. Most real estate firms struggle with tech overload. Here’s how to choose commercial real estate tech among the plethora of options.

For more, read my Substack posts on the psychology of why these decisions are difficult and a detailed version of my CRE tech decision-making framework.

How to choose commercial real estate tech in 6 steps

Below, I give you a 6-step framework for decision-making. I used this framework as a buyer of commercial real estate tech (aka CRE tech) and as a tool when I was selling software to real estate firms. Without further ado, here’s the framework:

1. Create a healthy culture around decision-making.

Ensure your culture AND compensation structure does not penalize individuals for making mistakes in tech choices. You must also review the success of your CRE tech and structure strict rules around your review process.

No finger pointing.
Maintain a zero-regrets mentality. You made the best decision you could with the information available at the time.
If you chose a CRE tech tool that failed, identify what part of your process needs to be tweaked to prevent a similar situation. A bad system will beat a good person every time.

Lastly, and perhaps most importantly, avoid death-by-committee. Give the decision-making reins to a competent resource (or three, if you’re a larger organization).

2. Identify pain points where your firm needs to improve.

To define pain points, create small functional groups of 8 or fewer people to discuss 5-10 areas for improvement. Not all pain points require technology to solve. You’ll be surprised how often a change in procedure will suffice.

As a counterargument to myself, Henry Ford once said, “If I had asked people what they wanted, they would have said faster horses.” He implied that relying on consumer input here is quite risky. So let me caution you. I am not suggesting that you ask your team for input on solutions, only pain points. You must determine what your team will want before they figure it out.

3. Rank pain points. Then, select one pain point to solve at a time.

I can’t prescribe exact actions to weigh one pain point versus another. Our industry is too broad, and each company bespoke. Trust your judgment.

Focus on solving one pain point at a time. Dr. Andrew Huberman, a famous Stanford neurobiologist (at least, he’s famous to us podcast-listeners) warns against the mythological siren of multitasking.

4. Ask for help.

Connect with your peers to find out what tools solve their similar pain point. Ask for details about their experience.

Sure, you run the risk of a competitor-peer being untrue, but most people are good people who are just as lost as you and looking for answers. It’s less risky than relying solely on VCs or advisors, who are incentivized to get you to use their products. Always keep in mind the incentives of whom you speak.

5. Read reviews and case studies.

Try Reddit’s r/CommercialRealEstate or r/RealEstateTechnology and the company’s LinkedIn posts to see if they have comments or likes. DM folks that commented or liked to get their feedback. And if you’re in multifamily, you can try Revyse.

Of course, check out the CRE tech’s company website. They should have free resources and case studies where you can learn about their product or problem they solve in more detail.

6. Make a decision, and sign as short of a contract as you can.

Shorter terms require you to re-evaluate more frequently. Yes, it’s more expensive. Think of it as buying an insurance plan. You can extend it for a longer timeframe after the first period if you want to continue.

But beware of the commitment and consistency principle.

If you’ve really gone through all the steps above and every single review, referral, etc. are exactly the same… then flip a coin. If they’re exactly the same, then it clearly doesn’t matter what you choose. All that matters is that YOU CHOOSE SOMETHING. You must set deadlines to force your hand.

If you subscribe to this framework on how to choose commercial real estate tech, making a decision is better than no decision. The regret of commission will sting, but trust me, the feeling of success is worth it. Start now.