Posted 3 years ago by Switched On Space
The pandemic of 2020 has left many in real estate reeling. The lockdown, working from home trend, and an abundance of ‘thinking time’ in the face of a sector that has been placed in to suspended animation, has allowed many in real estate to question the future of the industry as a whole. Many are viewing their business models, operations and structures as obsolete or severely outdated, and many are looking for solutions.
Technology companies have fared well throughout the pandemic. This can be seen in the markets, and also through real estate; the tenants that are still paying! In recent years the property technology investment business has been doubling annually, creating an assembly line of new and exciting solutions for the perceived problems in real estate.
With a heavy flow of new and innovative proptech investor solutions hurtling towards the real estate sector, is the industry ready to invest wisely and effectively? We look at some of the key mistakes that are being made in our sector and address how to resolve them drive huge productivity gains, by applying rigour and process to technology investment in your business.
4 Common Mistakes
Innovation syndrome – The need to innovate ‘now’ overshadows the need to research rigorously. Goal setting is bypassed, answers to problems often come before questions are thoroughly laid out. In short bad decisions are made quickly.
Panacea pilgrimage – The vision of how your business will look, drives an impatience to achieve it in one single swing of the bat; The fix all panacea. This invariably leads to an over estimation of what your organisation is capable of achieving to an excellent standard.
Beta Buying – The process of acquiring technology is perilous and is often not your primary expertise. Without having a deep understanding of the provider, it is often difficult to really know if you are investing in a long-term solution.
Mission Creep – Projects that discover problems along the way invariably become bigger and bigger, and longer and longer. People lose interest, motivation and it develops a self-sustaining life of its own! The initial goals, ROI and purpose are lost, and the project drags and increases in cost.
Result – money invariably lost, organisation de motivated and unlikely to become a constant investor in technology. The long road to obsolescence becomes shorter.
How to avoid these common mistakes
Goal set – Ask the burning questions that you believe affect your business. What are you trying to achieve and why? Be ruthless in narrowing down these questions until you come to one goal that is your absolute priority.
Criteria – Once you have a goal, you can begin to set criteria that a solution or answer must provide. This may be centred around cost or outcome but should be both.
ROI – When researching potential solutions, be sure to address Return on Investment first. As good as a product or technology may be, its business, and unless it pays for itself or delivers the required outcome it’s not going to work at scale.
Repeat – The process of iteration is everything in innovation. Keep asking the burning questions and tackling the issues one by one, each time learning more about what is available, and what returns on investment.
Result – Though wins are sometimes smaller, they always deliver a return on investment and this encourages you that there is value in being an innovation investor.
Remember these truths
- Most real estate companies are not investing enough or at all in innovation.
- Innovation is a constant process of ruthlessly pursuing ROI on technology investments
- Whole system panaceas don’t exist
- Set a goal
- Use criteria
- ROI is everything
About the writer:
Zac Goodman is a veteran property investor having founded NorthHill Capital, a leading real estate investment company in London. He also built TSP a high-tech managing agency managing over £2bn of real estate. SwitchedOn.Space was formed to identify & curate high impact technology for the real estate sector. Goodman’s newest company is growing rapidly in the face of huge technology investment in real estate. His vision is technology to improve our world, our environment & our lives, no compromises.
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