It was in this very column, back in July, when I wrote about how the British government was starting to take PropTech a little bit more seriously.
This week, it was reaffirmed once again with a round table run and organised by the Ministry of Housing, Communities and Local Government (MHCLG) which was chaired by our housing and planning minister, Esther McVey.
Let me just frame the occasion: it was a one hour round table and then a few one-to-one meetings beforehand with key PropTech firms that might just hold the key to some of the problems our sector is facing.
While I can be positive that this is a step in the right direction, a view shared by the majority in the room, this is a long long way from improving the way that the property market in this country works.
It doesn’t, after all, address the fundamental image that I try to address at every possible opportunity: this is not a technology shift, it is about mentality. No government can address attitudes and opinions that have been formed many years earlier.
Regardless, let me give you a flavour of the event.
There were three main groups present, if you exclude the bunch of very clever and young looking special advisors to Esther McVey. These were PropTech firms, venture capitalists, and, ultimately the more important group in my mind for events like this, incubators, accelerators and associations.
Two of the most powerful organisations represented there were the UK PropTech association, the not-for-profit representative body for the industry here in the UK (of which I am a director), and also Geovation.
Geovation is a government-backed accelerator scheme - run primarily through HM Land Registry and Ordnance Survey - you can read a previous column that I wrote about their initiative here.
Reaching out to them after the meeting, it became clear that they are essentially acting as a bridge between the private and the public.
To quote Alex Wrottesly, the Head of Geovation:
“Housing is obviously a key topic for the Tory party - if Esther McVey can get close to delivering the desired outcomes it would be a big win for her politically.”
“I think she’s genuinely quite passionate about the benefits too. That said, it’s a pretty low risk strategy to support some scrappy startups given the possible upside”.
Bringing in Sammy here, the Managing Director of the UKPA, she stated:
“I thought it was encouraging that the housing minister led the conversation and is keen for the U.K. to be a centre of excellence for PropTech. It shows she believes PropTech can and is already helping to improve the housing market and the Roundtable was a first good step to take identifying how government can support startups in the space and help overcome some of the barriers.”
It seems most were positive outside of the meeting and Alex mentioned the term ‘passionate’ in his thoughts. This was mirrored by thoughts from the PropTech group, too.
Jonny Britton from Land Insight, a firm that specialises in land sourcing, stated the following:
“The passion that the PropTech folk brought to the table was matched by Esther McVey. This was very nice, if slightly surprising, to see.”
“It felt like finally we had a chance to demonstrate the significant innovation in PropTech that is happening, and that the government is listening so it can align it to their agenda. This hasn't felt like the case in the past few years and it's pretty exciting to see.”
They have all spoken about ‘passion’, but I think it was more a sense of relief that all their hard work over the years is starting to get the recognition it deserves.
From all my global travels, I know that the UK is moving more quickly than most, but it’s still a snail’s pace in comparison to how quickly the tech sector is looking to (trying to) move.
One of the central discussions was around funding. ‘The government funds crazily expensive projects’ was the accusation at McVey and therefore they need to realise that they do not need to take on this much risk.
‘Do they understand the support a £50,000 investment would make in some of these start up businesses?’ was one of the questions.
Therefore, why choose to give one grant or investment at £750,000 with a known business that is already a huge, well-known brand? Why not just split up the funding to the ‘underdogs’ was one suggestion to really accelerate their growth and give alternatives?
While this was supported universally - as you might expect - this, in my mind, is a rather silly solution. it needs to be about partnerships with the public sector, not just them opening the purse which we all know is far from straight forward.
Much of the discussion rightly centred around data partnerships. ‘Give us your data access!’ was the big plea from the group. ‘Tell us what order’, was the response.
There you go. An obvious step but one that will no doubt move slowly. Frustratingly.
This was a view shared by the Founder of Built ID, Savannah De Savary, who was at the event:
“Data sharing remains a pressing issue for many startups, as does the pace of adoption in the public sector.”
One interesting take away for me on the data side of things, though, again highlighted to me by Savannah, was a comment made by two of the delegates around the resistance of sharing data.
I have always felt it is an education issue around not knowing what they have or the value it holds to them as an organisation.
It was suggested, and met with some agreement, that it is the total opposite. They know exactly the value and hence they don’t want to release it because they may well extract value themselves at a later date.
If they give it to a third party, they will ultimately lose out. It’s an interesting thought, and put nicely in this quote: “the need is to emphasise the value is in sharing data, not the data itself as this leads to hoarding”.
Another partnership opportunity is around the use of their own property as a ‘sandbox’ - it was tabled that this is already on trial in Lithuania and should be copied.
This is an obvious no-brainer in my mind. They are asset owners. Support the sector, drive efficiencies at the same time, save yourself money and give the impression that you are progressive at the same time. Everyone wins.
Let me move to a summary of those opportunities that were discussed and quote Sammy from the UKPA again. She highlights four areas of work to be done...
Key takeaways include:
1. Public sector to work with PropTech companies on pilot studies to showcase PropTech and the value.
2. More ownership from public sector to bring in all decisions makers into one room to speed up processes.
3. More support is needed to get smaller local projects off the ground.
4. Local authorities need to have a main point of contact when working with PropTechs.
It was that last point that resonated around the room. We have all been working with Jess Williamson who is the PropTech lead at MCHLG. There was almost universal acceptance that “we need more Jess”.
The bridge of communication between private and public will only be complete with more contact, more discussions, more understanding and, ultimately, more acceptance that this is the way it is all going. A matter that I think was clear for Esther McVey.
To conclude this overview, it was a very positive first step. Communication lines are open. The government is listening to this movement of change but I don’t think it will be as easy a ride next time an event like this occurs.
A final word needs to be with Alex from Geovation, perhaps the most vocal on this topic given his position between the two worlds:
“I would have liked to see the startups be a bit punchier in their asks. A little too deferential maybe? If we were to do it again, I’d prep our teams to be really specific about their demands of the government and, more importantly, the consequences of inaction.”
Inaction indeed. That will not go down well with that room if they meet again I suspect. Let’s keep this all moving forward for the good of the general public. They are the ones that really matter.