Secure and Streamlined Thanks to Technology
I’ll be the first to say that real estate is relatively new territory for me. My background is in tech and for the past several years I’ve filled various roles with BitTorrent, a leading peer-to-peer file sharing and media distribution platform.
The transition to a real estate-focused fintech company was fueled largely by possibility. In RealtyShares, I see the potential to create a dynamic change in real estate through a data-driven approach which disrupts slower-moving incumbent middle-men. BitTorrent is a deep technology company and I believe that RealtyShares has formed a similar vision. Technology is an integral part of building not only a product but a business as well.
Changing the game with innovation
When I look at RealtyShares, its positioning in the crowdfunding industry and the larger real estate market, I view it in terms of a short game and a long game. The short game, as I see it, is to empower an already successful business to accelerate its growth with a high performance technology platform at its foundation. Data-driven process automation, I believe, is one of the most important elements of furthering the goal of winning at this short game.
Real estate, historically, has been a digital technology laggard. The traditional conventions by which investors find and fund deals and sponsors secure financing have created a framework that tends to fall far short of being user-friendly. The typical underwriting procedures that most real estate investment companies utilize are a prime example of how the industry is missing out on huge opportunities to improve.
When a sponsor approaches an investment firm with a deal, they’re subjected to a close examination of their personal finances as well as the details of the project itself. That includes looking at the sponsor’s track record and credit history as well as generating data-driven models to assess the deal’s profitability. This rigorous scrutiny helps to ensure that sponsors and deals are being properly vetted to help reduce the risk to investors but the result is a time-consuming process.
Technology, on the other hand, has created an opportunity for platforms like RealtyShares to apply those same underwriting guidelines in a way that’s potentially more streamlined. When a sponsor proposes a deal, our expert team uses tech to analyze specific data points, which allows us to determine whether it’s a good fit for the platform and our investors. From start to finish, with technology-based optimization, the underwriting process can take just a few days to complete, which is a potential advantage when time is of the essence.
That increased efficiency afforded by tech is central to what I hope to accomplish as Chief Product Officer. I’m here to help with the development of a product that’s attractive to investors but on a larger scale, I’m interested in the creation of a scalable business. Technology is the link that connects RealtyShares to potential sustainable growth. My job is to figure out how to use what tech has to offer to achieve that.
Serving our real estate savvy community
We cater to two sides of a house. On one side are our customers who are the investors. On the other are our suppliers, who are real estate project sponsors. The investors are in the market to buy the right product at the right price while the sponsors are looking to sell their deal. How do we enable the sponsors, who have a potential attractive investment product, and the investors, who want that product, to connect?
That’s a question I feel is best answered by technology. On the sponsor side, we’re incorporating tech into our data-gathering efforts and that data is then used to quantify whether what’s being proposed is a solid financial instrument. We want to be as thorough as possible with our underwriting to ensure that the deal rings true with how it’s represented by the sponsor.
The next phase is offering the product to the investor in a way that makes the experience as seamless and transparent as possible. Technology helps facilitate that by allowing our investors a potentially superior user experience when they interface with our platform. With just a few clicks of a button, investors are able to review new opportunities, track their returns and receive payments from their investments automatically.
Those tech-fueled capabilities feed into my vision for the long game. Today, fintech companies like RealtyShares are building marketplaces where investors and sponsors are meeting without the potential constraints historically associated with private real estate investing. We and other companies are acting as disruptors in the way real estate assets are financed.
From marketplace to a real estate exchange
I see a very real opportunity for real estate to eventually become a more freely tradable asset-class. Real estate is, after all, an asset class just like any other, with unique risks and the potential for gains and loses. While an infrastructure has grown around public market equities, investors have limited ways to buy and sell shares of a property the way they would a publicly traded company.
Crowdfunding is bringing real estate closer to that reality. People are now laying claim to a stake in private deals, and with the help of platforms like RealtyShares, platforms are opening up these potential opportunities to a wider group of investors. Technology is helping to force real estate to set aside the old and bring in the new.
At the end of the day, what motivates me most is the dream of what this platform is and what it has the potential to become. While the real estate market will always be unpredictable, the people I’m surrounded by are passionate about what they’re doing and I’ve already seen proof positive that what’s happening here is working. The opportunities for RealtyShares to continue to excel in the real estate space are very real and I fully embrace this new role and all the possibilities that it entails.
