INTRO:Ecosystem for real estate market players

7 min readJun 27, 2018

The team of INTRO TECHNOLOGY RUS, JSC, is glad to present the INTRO Token that will become a license to the INTRO Services for real estate market participants.

Our team has been creating software for developers since 2016. Our IT-project was originally initiated by the Gosstroy Group, a major Russian real estate development holding, est. in 2009. Today, the development portfolio of Gosstroy includes 14 completed residential and commercial objects, as well as 13 under-construction buildings with total area of about 150,000 sq.m. By construction volume, Gosstroy is one of Top 150 developers in Russia.

In early 2017, the IT Division of Gosstroy was separated as an independent business and registered as INTRO TECHNOLOGY RUS, JSC. In early 2018, the company had 42 staff members and about 20 freelance contractors. The main profile of the company is the creation of Business Intelligence System for off-plan property investors, as well as the development of IT-products for business and state actors.

The rapid growth is largely caused by the growing demand for BI systems from market players and regulators. Over 20 construction companies, several governmental agencies and industrial associations is now using the products of INTRO RUS. Our users include the representatives of National Association of Housing Developers, Union of Construction Companies of Ural and Siberia, Chelyabinsk Interregional Union of Builders and other professionals from 18 parts of Russia, where INTRO business is present.

However, the potential of scaling of our BI system is not limited to the market of Russia and the CIS countries. According to our research, more than 10 million homebuyers a year invest in off-plan properties in the BRICS countries. Most of the residential property in India, Brazil and Russia are sold at the construction stage. Still, offplan development remains a risky investment due to low market transparency.

We were the first to use AI (Artificial Intelligence) to collect and process data on off-plan development investments from the official state registries. Now our system INTRO Analytica quickly processes raw data on property rights claims, helping to create accurate market forecasts. At the next step, we plan to integrate the blockchain technology for data protection and secure transactions between developers, investors and home buyers.

Our mission is to make the global off-plan property market transparent and to protect the developers and homebuyers against insecure investment.

INTRO Tokens will become the access key for the INTRO ecosystem, which brings together developers, investors and home buyers from all over the world

What is INTRO Blockchain?

INTRO Blockhain is an ecosystem of blockchain-based solutions for real estate market participants

We provide market analytics & management tools for property developers and investors.
We provide a digital marketplace of real estate to all market participants.
We will create a social network for property brokers & private investors.
We will provide smart contracts for shared property investment, property purchase by installment payments and direct contracts with developers.

Problem

INTRO has succinctly described the problems that they’re aiming to solve with their products which is superb. Below are the issues that they have identified in their whitepaper:

No unified register of under construction properties.
Data on off-plan property deals in state registers is not structured.
No register of apartments, parking lots and commercial properties under construction.
No control mechanisms for stages of off-plan construction.
Off-plan investors lack access to the investment records that influence their interests.
Developers often suffer cash flow gaps during the construction cycle.

Problems 1, 2, 3 & 5 are significant issues for investors with less resources, as they will be unaware or unable to invest into properties that they either don’t have access too or are unwilling to take unnecessary risk due to a lack of information. This information asymmetry has generally resulted in many property investors only investing in properties that are near their local area, have transparent income documents, or properties that have highly reputable developers . The issue of information asymmetry is the one I’m most interested in, because if INTRO can remove this issue for their customers, they will have a significant market advantage as more international investors will be willing to purchase properties through their services.

Problem 4 in laymen refers to the issue where there is no easy way to manage the amount of investment that is given to a developer. This is a problem because if a developer runs out of funds provided by investors before finishing their construction either due to negligence or incompetence, the investor will either need to provide more funds which lowers their potential returns or abandon the project altogether. Investors are aware of this risk, and this is why some potentially lucrative property investment opportunities are just too high risk if the developer’s reputation is questionable.

Problem 6 is more straightforward. Due to the capital costs of construction projects, some developers simply can’t afford to finish their project without selling off properties or obtaining commitments from investors to buy those properties before they are complete . While it’s already possible for developers to sell off the plan buildings before they are complete, the amount of time it takes to find buyers could delay or put a construction project into jeopardy.

Solution provided by INTRO

INTRO has placed their solutions to the problems right under the problems stated in their whitepaper. Below are the solutions to the problems that they have identified in their whitepaper.

Our system includes a dynamic database of the off-plan properties.
The automated linguistic analysis is employed for data tokenization. Then the property ownership records are matched with building plans with the use of AI technology. This way, the system detects and corrects errors caused by the human factor or changes in building designs.
The system analyses floor plans of under construction buildings. Each off-plan property can be found on the plan and marked as “sold” when its developer cedes property rights to the investor. This allows for instant monitoring of sold and stock properties.
A special module in INTRO checks the relation between investment volume and construction phase.
INTRO users can access the anonymized state records on off-plan development agreements. It helps investors and homebuyers to find a reliable developer and profitable property.
The module for private property auctions allows developers to quickly sale of properties and close cash flow gaps without damaging the general sales plan.
If these solutions are successfully implemented, they will mostly address the issues relating information asymmetry, bad construction developers & the developers need to quickly sell of properties.
The main concern I have is about whether & how INTRO would enforce compliance when it comes to developers who break the rules, or if an investor doesn’t pay what is owed to the developer. If a developer or government agency provided incorrect information inadvertently or willingly and the investor suffers or vice versa, what would be the repercussions? And if there were to be a legal dispute as a result, how would INTRO mediate this issue? If INTRO has an effective way of handling such disputes, then I think they’ll be able to easily acquire both construction developers and international investors who worry about this potential issue.

Competition

INTRO identifies their potential competitors in an easy to read table which shows what features each competitor does and does not have.

If INTRO’s competitive analysis was thorough, then INTRO will have a major competitive advantage that will only increase as they scale their operations globally and obtain further funds to increase their technological lead compared to their competitors.

The Market

If INTRO’s Off-plan development market size figures are accurate, the ‘Domestic market’ is valued at $25.89 billion EUR and the ‘Achievable markets’ are valued at $142.89 billion EUR in 2016 (7). That is a significant market which should provide INTRO with plenty of opportunity to obtain the market share required to maintain and expand their operations. Given that 20 developers, 3 real estate agencies & over 1000 early subscribers among Russian home-buyers are waiting for the release of INTRO’s future products, it seems very likely that there will be demand for INTRO’s services when they begin expanding globally.

The Business Plan

INTRO has a great business plan which inspires confidence. They already have a working product in the form of INTRO Analytica & INTRO Sale which is already used by over 20 large Russian construction holdings (9). This suggests that they have already validated their products and that they’ve already consulted key stakeholders such as developers & investors as to whether their products are needed. COINvest is expected to be completed in July 2018 & INTRO Restate sometime in 2018 (12). If INTRO can stick to their relatively fast development plan, investors in their ICO should see rather quick gains on their tokens because of INTRO’s achievements.

Verdict

INTRO has created a Start-up which has the potential to significantly address many of the issues associated with buying Off-plan development properties internationally. Due to their very experienced team, existing service offerings and customer base, they have a decent chance to obtain a sizable market share globally.