An interesting debate has been sparked in PropTech this week.
It started with an interview, published on YouTube, in which Kristjan Byfield and Christopher Watkin discuss how PropTech firms are poor marketeers and that this is a key reason for reluctance to adopt technology in the property industry.
Is this true, or do property professionals actually continue to sleepwalk into a future which simply innovates around them?
If true, the comments are quite damming of the PropTech industry. During the interview, Kristjan speaks very eloquently about an ongoing confusion among professionals as to how most PropTech solutions actually benefit them on a practical level.
“[PropTech companies] often go about building an entire business model...without coming out of the micro-bubble of their own personal little world. They have no industry knowledge, no industry experience.”
This, he suggests, is how many entrepreneurs approach the property industry, interested more in how they can become a ‘millionaire in five years’ than how they can truly benefit those within the industry.
This lack of knowledge and experience, says Kristjan, leads PropTech companies to market themselves in flawed, industry-inappropriate ways. It is no surprise, then, that many property professionals remain unimpressed by the countless pitches they receive.
Kristjan says, for example, that many don’t understand that ‘80% of the [agency] market is made up one-or-two-branch agencies’ and that pitching to them is profoundly different to pitching to a corporation.
Their lack of industry knowledge also forces them to act based purely on their knowledge of the technology world - often they look at the true giants of this world and mimic their successful marketing methods.
The problem here, according to Byfield, is that most tech giants are B2C-focused, selling directly to the consumer. This is ‘radically different’ to the common PropTech need of selling to businesses.
Difficult to identify a good fit
At this point, the interviewer, Christopher Watkin, suggests that PropTech marketing is ‘atrocious’, a comment which, at first, made me jolt.
But then I put the question to the Unissu community and it seems some people agree with him.
Gavin J Gallagher, Head of Innovation at Earlsfort Group, had the following to say:
“I’ve had quite a few PropTech entrepreneurs in front of me pitching their businesses in the last twelve months. I always welcome the conversation because I am curious about PropTech and I enjoy the discussion, but a number of them were very poorly prepared, struggled to clearly articulate the benefits to me (the customer), and did not have clarity on the problem they were claiming to solve...the shortage of skills in areas such as pitching or structuring the offer have made it difficult for me to identify a good product fit.”
First things first, it is completely unforgivable to arrive at a pitch without knowing exactly how your customer benefits from your offering. Absolutely appalling.
In fact, it’s so appalling that I struggle to believe it’s that much of a common occurrence. How does one go about forming a company and building a platform without even knowing why you’re doing it?
I don’t think you can; and I certainly don’t think it’s a common theme throughout PropTech. In truth, I think we all need to calm down a little. I think both sides have unrealistic expectations of the other.
I say it’s unreasonable to expect a technology founder to have an equally intimate knowledge of an industry as the professional who has been working in it for fifteen years.
Equally, it’s unreasonable to expect that a property professional shares the tech entrepreneur's nuanced appreciation of technology.
And yet, these are commonly cited as reasons for the ongoing tension between the two sides.
Two heads are better than one, and certainly better than none
We need to understand that each party is coming from a different angle, a different background, and brings with them different knowledge. And we need to understand that this is a good thing! It’s where all the power of technical disruption comes from.
If an agency, for example, is going to dismiss a PropTech platform because they perceive them to lack industry knowledge, they’re not going to make any progress at all.
If their knowledge is flawed, why not help them improve it? It is, after all, for everyone’s benefit.
At the same time, PropTech professionals can’t enter a pitch and talk in technical jargon about algorithms and automation only to act stunned when the audience fails to see the practical benefits of such cerebral concepts.
We are all flawed in our own way, yet, if we’re willing to look, we’ll see how all our edges happen to fit neatly together.
We need patience - I’m not convinced it’s a virtue, but it’s certainly an ingredient to prolonged success.
I admire Kristjan a lot, and not just because of his enviable, glorious, two-tone beard. He is a rare breed; someone who has a detailed knowledge of the property industry alongside detailed knowledge of technology. We can’t, however, expect everybody to be like Kristjan.
I do want to clarify that I agree with many things he says, he raises some really important points and I recommend everyone watch the short interview.
But, I also believe that, if some agents are seeing this as a recurring theme, it might be worth re-evaluating what’s really going on.
Are you just hearing what you want to hear? Is there an underlying prejudice towards technology that leads to selective hearing? A certain schadenfreude from their inability to match your industry knowledge?
I ask the same of PropTech, too. If you are repeatedly failing to execute successful pitches, perhaps you need to reflect on why, rather than angrily penning contrived articles about contemporary luddites in which it is suggested that ignorance is the new wooden clog.
Why must one side hold the power?
At one point in the interview Christopher Watkin, more or less scoffs at the idea of a technology provider wanting their customer to be more open and flexible, as if such a thing is utterly unreasonable.
This is a problem to me. Because the answer is yes, you do need to be open and flexible. Technology isn’t an option, it is completely essential.
Unless we work together, share our different expertise to co-create a complete vision of the future, we’re all going to collectively fail.
One particularly stubborn barrier to mutual success is highlighted at another point during the interview, when Kristjan suggests that PropTech’s attitude towards property professionals is, you need to work harder to get us.
If this is the vibe PropTech companies are giving off, shame on you. But, if I’m honest, I really don’t understand the purpose of such a statement.
By saying what Kristjan says, is he not implying that he thinks the opposite is in fact true - that PropTech should be working harder to woo property? Because that’s not the case either, and an equally unhelpful standpoint.
It’s a team sport that we’re all playing, and we’re all in the same coloured shirts. I don’t know why so many people seem so very keen for us to don different colours?
This should not be about who has the power, or who has the upper hand in negotiations, or who needs whom the most. That’s old school business-speak, unfit for modern practices.
You should read the fabulous book, The Digital Transformation Playbook - it will explain very clearly how this traditional attitude towards competition and collaboration is completely outdated.
The modern world demands we work on a symbiotic basis - when I succeed, you succeed. This requires both sides to lay down their weapons and talk constructively.
I’m fascinated to hear what you think about all this. Do you agree with Kristjan and Christopher that PropTech is failing to market and pitch itself? And that this is due largely to a lack of industry knowledge? Or do you think property professionals are hearing only what they want to hear?
Or, do you agree with me that it matters not who is failing to do what, because the whole point of this PropTech movement is that we combine the expertise of technologists with that of industry professionals to create something far beyond anything we thought previously possible?