In a recent article by Min Suh about how Cloud-Based Software is Revolutionizing Commercial Real Estate Underwriting, Suh places insight into the current state of the real-estate industry as a whole, and the context for where technology fits into the ever changing environment of commercial real-estate.
Whilst no one can argue against the lucrative nature of the industry, everyone senses a change in the air. It’s a mix of pressure from other industries, and migration of millennials- all pushing the commercial real estate industry to embrace technology.
The first push can be seen with the emergence of crowdfunding. In 2012, with the JOBS Act, floodgates were opened for the general solicitation of securities; specifically, real estate securities. In an unprecedented and unanticipated fashion, crowdfunding exploded onto the real estate scene. The resulting millennial migration into the industry meant the integration of technology into the real estate industry. Workforce skill sets in code writing, web site design, SEO and PPC marketing meant the meshing of real estate technology with the artistry of customer service.
In 5 short years, crowdfunding has grown exponentially and so have the opportunities associated with it. Firms are aware that “dialing for dollars”, or “passing the hat at the cathedral” no longer work. Benefits of crowdfunding have become clear, as several top tier companies have had great success (with valuations in the tens of millions of dollars, having grown from a twinkle in one’s eye to a Wall Street Phenom, seemingly, overnight). Changes, however, occur quickly in business. Faster technological advances lead to industry saturation of data, and a lack of innovative ideas due to over-dependence on technology. This of course leads to an eventual loss of demand and enthusiasm. Technology that was once an industry disruptor, or game-changer, has now become a lifeless, boring bot of quasi-digital technology.
Having said that, crowdfunding (with all it’s benefits) is no longer enough, and the necessary change in the industry can’t stop with it alone. Technology has grown far beyond the digitization of 5 years ago, as presented on crowdfunding sites. It is time to adapt or die. It is time to innovate once again.
The opportunity to up its game was lost on Wall Street, as they were too busy with the grind to notice the impending change in status quo. Always chasing the next quarter’s P & L, they were too focused on the profits, and forgot about the sponsors and investors. They forgot how the customer service experience and satisfaction is tied to profitability.
As Suh asserts, “Nearly every industry is trying to figure out how to get on the data-driven bandwagon.” Real estate is no exception. Advanced analytic technologies are currently creating both a void and a niche in the real-estate industry- with those who insist on it being a void potentially getting left behind.
Enter, Artificial Intelligence (AI). It is here and now. We currently see this technology all around us, driving Amazon, Netflix, Facebook and Google. AI is able to aggregate trillions of data points and correlate them into an instant outcome for your enjoyment and deployment. Until now, AI has been used in almost every industry except CRE. The Industrial-Era mindset and culture is, however, shifting as those in the industry are recognizing the need for change. We are re-thinking real estate- no longer labeling it as strictly an art, when it can become a science. A science driven by Artificial Intelligence.
Rather than being reactive to the changes that are sure to come- eVest has seized the opportunity to be proactive by staying on the cutting edge. RealtyeVest’s White Label Platform (eVest Technology) is essentially the RealtyeVest crowdfunding platform on steroids. It introduces a public facing design with financial modeling, automated accounting and a real-time CRM dashboard, and it is presenting an AI tool for the first time ever that will be available for use by both the Sponsor and the Investor.
Developing and scoring probabilities for successful investing is no longer a dream, ripped from the pages of The Sci-Fi genre. Decision-making can now extend beyond a short list of data-points. Utilizing algorithms, eVest has designed software to aggregate Big Data and develop correlations to generate a specific outcome. Sponsors can now make acquisition decisions based on science and statistics- big picture drawn by a wealth of data. Investors gain peace of mind, knowing that Sponsors are utilizing this data-centric decision-making process. Welcome to the Fourth Industrial Revolution: eVest Technology.