The real estate industry has yet to embrace technology in comparison to other industries when it comes to digital transformation. However, times are different now, as the sector is evolving. And, many proptech startups are emerging with an aim to transform the sector and bring a positive change.
AMAVI Capital’s new proptech fund
In a recent development, Belgium-based investment platform AMAVI Capital has announced that it has raised over €30M from private and real estate linked investors for its new pan-European proptech Fund in the first capital round. The firm claims that it is the first property technology fund in the Benelux that brings together real estate, technology, and private equity expertise.
The AMAVI proptech Fund will invest a total of €60M on scaleups that provide innovation within the real estate and construction sector. The fund aims to build a bridge between the traditional real estate sector and the “new school” proptech companies. Since last year, AMAVI Capital has already screened more than 200 companies and has also invested in a few.
Investors in this round
The investor base is deliberately made up of investors from all areas of the real estate and construction industry. These include real estate investors, project developers, contractors, property managers, estate agents, and architects.
This mix of expertise is also reflected by the founders of AMAVI Capital. Arne Allewaert, Davy Demuynck, and Kristof Vanfleteren earned their stripes in the real estate world with the fast-growing Belgian property developer ION. As for Frederic Van den Weghe (ex Waterland and Gilde Equity Management) and Paul Thiers (serial investor), rely on their experience in private equity, while Jonas Dhaenens has proven himself in the technology sector with the development of the first Belgian “unicorn” team.blue.
Sustainable solutions and closing the funding gap in proptech sector
According to AMAVI Capital, currently, there are about 7000 proptech companies with half of them having European roots. However, only about 10 per cent or less of all proptech venture capital goes to these European companies, which have the same quality to their American and Asian colleagues.
In addition, proptech’s share of the global venture capital sector is only 6 per cent of all investments. And all this while the construction and real estate industry is the largest asset class. The investment firm claims that there is, therefore, a substantial funding gap that needs to be closed.
Arne Allewaert and Frederic Van den Weghe, managing partners of AMAVI Capital, comments, “With the first PropTech fund in the Benelux to bring together real estate, technology, and private equity, we are committed to combining European real estate expertise and capital. We are convinced that we can be the central cog that develops promising scale-ups into mature proptech companies that bring real change to the sector, both in terms of sustainability and efficiency. This change is also vital.”
They further add, “In a sector responsible for no less than 40 per cent of all global CO2 emissions, the need for sustainable solutions is high. It is also no longer possible to reconcile the fact that the immense construction and real estate world – 60 per cent of all assets worldwide are real estate – is also one of the least digitalised sectors. Productivity in the construction sector has actually declined over the past 50 years.”
Smart investment for the construction and real estate sector
AMAVI Capital’s investment focuses primarily on European proptech scale-ups that make real estate and the construction process more sustainable or in big data analytics to achieve smart insights into the market and buildings.
The firm looks for companies that focus on improving customer experience and ConTech (Construction Technology) players that focus on specific efficiencies in the construction process.
For example, AMAVI Capital invested in Shayp, a Belgian proptech company that developed an automatic water leak detection system for large buildings. It is a software that allows water consumption to be tracked in real time and consumption data to be analysed so that leaks can be quickly detected and identified.
Another example includes Amsterdam-based Finch Buildings that developed a modular construction system in Cross Laminated Timber (CLT), enabling it to “prefabricate” large buildings – up to 16 storeys high – for assembly on site. The CO2-negative nature of wood, the healthier indoor climate of wooden buildings, a more efficient construction process and the circular aspect of modular construction make this construction process particularly sustainable.
In the coming years, AMAVI Capital intends to expand its portfolio to some 15 investments in European innovative companies capable of making a significant impact on the sector.