The property technology vertical, uniquely both Israeli and New Yorker, is fast growing through the strong relationship between these two locations.
By Jonathan Frenkel, ISRAEL21c
Technology and real estate are industries in which Israelis in New York have excelled over the past 20 years. So, it’s no surprise that the hyphenated vertical of real-estate (property) tech — or “prop-tech” – in the city is being led by Israeli entrepreneurs and investors using technology to address problems in this trillion-dollar largest asset class on the planet.
Below are some of the notable entrepreneurs and investors helping to build the New York-Israel prop-tech ecosystem. We’ll focus on the Israeli startups solving problems in New York that could be scaled globally.
New Relationships with Tenants
Many of the startups, however, are solving problems in the traditional residential and commercial real-estate industry.
A good example is Rentigo, an AI-powered startup changing the traditional property-management ecosystem by combining payments, marketing and operation decisions for real-estate operators and tenants on one platform.
Rentigo solves two problems in prop-tech: the need to streamline rent payments and the lack of a tenant-facing digital solution.
Community is an important part of the prop-tech scene. Rentigo’s founder, Sivan Blaseheim, created a digital community between New York and Israel to help founders learn from and help each other.
As he states, “With the prop-tech scene growing and prop-tech companies growing in number and value, I decided to create a place where we can empower our journey, and share experiences, ideas and needs. This community includes many Israeli-American startups who are very active in this industry and use it to learn, help each other, and even meet VCs and real-estate groups.”
Active investor Charlie Federman says, “There has been a paradigm shift with landlords having a difficult time adding more intangible value to their properties.
As such they’ve been following WeWork’s model of creating services which promote a direct relationship with the tenants.” WeWork fundamentally changed the game and launched a whole industry of workspaces and related amenities for millennial and small business workers. As Maor Cohen, CEO of Pickspace, a global coworking space directory, notes, “75% of working spaces are not profitable because of overhead costs.”
In order to solve a major problem for this industry, Pickspace is using technology to reduce coworking spaces’ overhead and white-labeling the platform for their use. Like many Israeli entrepreneurs in prop-tech, Maor splits his time between Israel and the market in New York.
Robotic Window Cleaners and Smart Cranes
Aside from being good problem-solvers, Israeli entrepreneurs also see opportunities where few have existed before.
Skyline Robotics tackles a problem in modern cities that affects real estate: keeping the windows of skyscrapers clean (particularly when tenants are paying a premium for the view) without the dangers involved in human window cleaners.
As Skyline Robotics CEO Yaron Schwarcz states, “Many businesses are not putting human safety first. … We created Skyline Robotics as a safe solution that is also competitive on quality, cost and time.”
Interestingly, far from putting the remaining window cleaners in New York out of business, Skyline Robotics is training and employing them as robot operators.
An initial concern was that people would be worried about their privacy while the robot cleaned their windows. The exact opposite has happened as people are interacting with the robots (by taking selfies), and as such, the Skyline team is currently working on ways for the onlookers to increase their interactions.
Diversity has been a focus in prop-tech, but sectors such as construction-tech don’t offer a major female founder presence. Which is why startups such as Versatile Natures are so important.
Construction tech is a particularly Israeli sector; with the amount of construction going on in the country there are many problems to solve in this traditional industry. Versatile Natures is enabling control over the most fragmented and non-structured place of all: a construction site.
Versatile Natures offers a crane-mounted, noninvasive data-collecting, analytics and insights system that monitors and learns the site via the crane-operation process. Data provided by the proprietary device is used to save time, reduce costs and improve operations and safety.
Founder Meirav Oren, who splits her time between Israel and New York, wrote, “I am committed to supporting more female founders in both tech and construction. Building a great company is about team, execution, market understanding and strong technology. The rest is what the founder, of any gender, makes of it.”
Silvertech of New York has been actively investing in Israeli founded startups over the past few years.
There are numerous funds based in New York that have invested in Israeli prop-tech companies that have migrated to New York, but the Silvertech VC and accelerator is committed with more than just financial resources. Silvertech only takes on prop-tech companies in which US real-estate giant Silverstein Properties is a likely customer.
Charlie Federman, Partner at Silvertech Ventures, states, “We have 22 companies in our portfolio, 18 of them from Israel, and nine are female-founded. In prop-tech there is a real need; it’s a trillion-dollar industry and behind in innovating services around actionable data, and Israelis are very attuned to that data.”
He adds that “in 2018, our portfolio companies raised $110 million in 15 financing events, and five of those companies are in prop-tech.”
New York-based venture capital funds such as MetaProp, the first and most active VC in the prop-tech space, have also taken notice of the strength of Israeli prop-tech.
As Aaron Block, one of the cofounders of MetaProp, stated: “The connection between Israel and New York in regard to prop-tech has a precedent; there are historical connections and existing infrastructure.” He believes this will continue as the market continues to grow.
What does the future of Israeli prop-tech startups hold? Just look at the growth of WeWork, the New York-based international phenomenon founded by a kibbutz-raised Israeli, Adam Neumann.
From a work-culture perspective, WeWork has been the most disruptive company in this space, changing how we spend the bulk of our time, which is working. With a current valuation of $47 billion, it is also the first prop-tech “decacorn” (a company valued at more than $10 billion).
Prop-tech is a vertical that is both uniquely Israeli and New Yorker, and it will only continue to grow through the strong relationship between these two locations.
Jonathan “Yoni” Frenkel heads a digital marketing agency, YKC Media, that focuses on engaging millennial and tech professionals through content. He’s been involved in the New York-Israeli tech community for many years and previously held roles as a non-profit professional at both the IAC Dor Chadash and AIPAC.