Private Equity Investments in Proptech Startups Growing at 55 per cent CAGR Since 2010: Report

The study also found that the inflow of funds into proptech firms stood at $ 551 million in the 2020 calendar year

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Private equity (PE) investments in proptech firms have increased by 35 per cent during the last calendar year to a record $741 million, says a recent report by Housing.com. The full stack digital real estate platform's parent company, REA India, also owns PropTiger.com and Makaan.com.

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The annual report on the sector titled 'PropTech India Monitor 2022' stated that in India, private equity investments in proptech firms have been growing at a CAGR of 55 per cent since 2010. The study also found that the inflow of funds into proptech firms stood at $ 551 million in the 2020 calendar year. The proptech industry in India has received a total of $ 3.2 billion in private funding between 2009 and 2021.

The investments tracked include private equity, venture capital, debt, PIPE (Private Investment in public entities), project level investments, and pre-IPO private equity deals, at the early, growth and late stage.

Proptech startups: An overview

Prop tech basically includes four segments which are tech firms doing sales and marketing, firms offering construction technology, co-working, co-living, interior designing and SaaS.

Since the beginning of the year, many proptech startups have been making headlines for funding, expansion and acquisitions. For instance, PropReturns, which offers realty investments including pre-leased commercial properties, REITS, and fractional investments recently raised an undisclosed amount of investment from CRED's Kunal Shah, NoBroker, which became India's first proptech unicorn last year, entered interiors market in March this year with INR 100 crore budget, Facilio, which is a SaaS startup in the space, raised $35 million in its Series B funding round led by Dragoneer Investment Group. Recently, Homexchange, which helps consumers exchange their old property with a newer one, raised $4 million.

Explaining how the space has picked up since the pandemic, Dhruv Agarwala, Group CEO, Housing.com, PropTiger.com & Makaan.com, said, "The pandemic has definitely turned out to be a crucial turning point for the proptech space in India. Like many other sectors, real estate managed to leverage the digital acceleration witnessed during this period. The adoption of new age technologies such as artificial intelligence & machine learning, virtual & augmented reality and blockchain has opened up new opportunities for startups in proptech."

He believes that proptech in India will continue to grow, with the future being anchored around key aspects such as efficiency, scalability, data-backed decision making and sustainability. "The adoption of technology will empower all stakeholders as firms will scale at a much faster rate, improve the consumer experience, bring in much-needed transparency, and aid in speedier decision making," he said.