Series: PropTech Chatter.
Show Notes
Summary
Chris Moreno - Primary Venture Partners
Special mentions
Company: NMHC, RETCON, Inman Connect, Industrious, SaaStr, Hyve, NAR REACH, ButterflyMX, Fifth Wall, Camber Creek, 1Sharpe, Stellifi VC.
People: Jay Parsons, Ryan Serhant, Jamie Hodari, Jason M. Lemkin, Gavin Newsom.
Transcript
(Disclaimer: Please be advised that this transcript may contain unintentionally confusing, inaccurate, and/or amusing transcription errors.)
Matt Knight: [00:00:00] Hey, guys, Matt here. It's, 2025 doing a kickoff with Chris was a PropTech Chatter about things going on around the world and what's coming up in the first couple weeks. So I won't belabor the point. But this is me and Chris chatting about the beginning of this year and what we're looking forward to.
All right, Chris. Happy New Year, man. Hope everything was copacetic over the holidays for you.
Chris Moreno: Yeah. Happy New Year, Matt. I would say, yeah, it was a blast being with family, seeing everyone, getting a restart to the year, but pretty wild with the snow, this half foot of snow in Atlanta, Georgia, and they're saying we may get more snow later this month.
Matt Knight: It's the time of year I get to flex at everybody. I think it's 74 today here in Phoenix. So you guys keep talking trash in July, but right now we get paradise
Chris Moreno: as they say, Matt, location, location, location, [00:01:00] right? In real estate
Matt Knight: this time of year, I think we win.
Chris Moreno: Yes, sir.
Matt Knight: So what's new since we talked, we talked in December, this will be launching this, we're recording this kind of the second week in January, it'll launch the third week.
What's happened since we talked in December?
Chris Moreno: Well, I'm, I'm excited. I mean, I've been focused on NMHC annual coming up in Vegas. It seems like everything's going to be in Vegas this year, but I'm looking forward to that. RETC is doing their kickoff that you're a part of as well with the, and so I'm pretty excited about diving in with some of the owners and operators.
See, obviously deals hopefully get moving. I think people are excited to do acquisitions and dispositions and shovel more money into new development because if you follow Jay Parsons, right, we need more and more development. But I think going down the rabbit hole, you know, hearing, hearing from folks on AI data, you know, MarTech.
You know, what's happening in resident experience and from the owner's standpoint, but so I'm really excited about that, man. That's probably the top thing on my calendar and then obviously Inman Connect coming up in New York City. [00:02:00] That'll be great to see obviously Ryan Serhant will be one of the speakers on, off of his fundraise.
I think also seeing some of the acquisitions, hearing a lot of acquisition activity, but the big congrats to, to Jamie and the whole team over at Industrious. So those are kind of like the top three things on my my list from the last, last couple of weeks.
Matt Knight: No, it's funny is, you know, I published this every week, kind of the, the, What Mattered This Week in PropTech.
And so far as of.
I'm hoping that is, you know, maybe we can make this part of our predictions for 25. I'm hoping this is a. Sign of things to come for the market is that the, the frigid unthawed markets for transactions in 2024 has come to kind of a a loud opening in 2025 with a lot happening. And, and to be, you know, obviously if you're announcing an acquisition this week, it's been in the works for months of last year, but still the fact that it is [00:03:00] happening, whether that's You know new president its interest rates if it's just election is behind us like whatever the reason It's it's off to a good start from what I can see so far.
Chris Moreno: I completely agree I think we're going to see you know, some people claimed I think it was Jason. At SaaStr who claimed he thought they were going to start having a Ipo a week in december. I don't know if we'll get to that point just yet. I think that could be maybe by You know, August of later this year, but definitely I'm very excited.
I think there's a lot of optimism you know, sadly with what's happening in LA right now, right. With housing, I think amazing. You're going to see, you know, we'll have to follow that closely. Gavin Newsom, the governor mentioned he was going to be accelerating the ability to develop right. Housing faster.
I think you're going to. Potentially even see ADUs getting, you know, this, this may be the time of ADUs and getting housing out there immediately for people who need it before costs skyrocket. And cause we're already seeing rentals and hotels skyrocketing. So, yeah, I mean, there's a lot of things [00:04:00] I think to watch over the next couple of months, especially with you know, the storms that we had out here and the hurricanes we had out here, that's obviously affecting markets too.
Matt Knight: And I suppose if someone's listening to this in the future, and you may not have context about January of 2025, there's these massive, historically large wildfires in the L. A. area. Pacific Palisades is one of the more famous ones, but I think there's three in total, and they're very, very large, just creating untold amounts of damage on property.
And I'm curious what this does to insurance. I mean, insurance is kind of an interesting thing to follow in our world for a few years, particularly in places like Florida and California and even coastal Texas. But yes, I, I agree, is it seeing how California, I don't know that I would call California a leader in housing, but I would say California has a lot of houses, and people pay very close attention to housing in California.
And so this will be, you know, obviously where our thoughts are with everybody who has gone through this. But when we get past it, it's going to be sort of an interesting [00:05:00] crucible for what does housing in California look like going forward. Because this isn't some hypothetical affordable housing deal in Oakland.
These are hundreds and thousands of houses across Southern California that are gone, that have to be rebuilt. So, I agree, that's going to be an interesting thing to watch as as hopefully this comes to a merciful end soon.
Chris Moreno: I, you know, and I obviously the you know, housing and not even housing. I think you're going to see commercial, you know I was talking to some businesses who are out there and they're having to move their stuff or get moving companies ready if they have to evacuate their materials, their teams, their offices.
So you know, it's almost like a shift. You know, and people are moving quite a quite a distance away due to the fires. You know, I'm kind of curious, you know, to kind of pivot, Matt obviously want to get your, your take on CES, because I know that's the, I've actually never been, and I need to go one, maybe I'll go next year with you, but I'd love to get your take on technologies, especially hardware, data, AI, as you see, and how it relates to the [00:06:00] PropTech world.
Matt Knight: So, CES, if you don't know, is the largest tech industry trade show in the world. I hear it's, it's extreme, 170, 000 people or something. And it's so big, it doesn't even fit in like two hotel convention centers in Vegas. It was the Venetian and the Vegas convention center and he used all of their convention space.
Plus, you know, keynotes at Aria and Mandalay Bay and I guess it's enormous. It's an enormous show. But I go for a very specific purpose. I'm looking for things we can sell to building owners, managers, developers, contractors, right? I'm only looking for that. So that's 5 percent of the 4, 500 vendors that come to the show.
And so my experience, Chris, I would tell you is probably different than most other people's I'm kind of blazing through 90 percent of it. And then stopping for 10 is like, Hey, would you be willing to sell to apartment? It was like, there was one. It's called Hyve, H Y V E. There was like a lock box for porch [00:07:00] packages, just for single family homes to put packages on.
It's a smart lock box. Which is they claim is, is the most affordable on the market. So cool. Right. And I was like, Hey, do you want to sell to, you know, home builders as an amenity or, you know, I was kind of brainstorming with them if they had a B2B strategy that we could help with and get them into the real estate tech industry, or if they're just purely straight to consumer.
So I thought. It was terrific, slightly smaller than last year. It's overwhelming and it's really cool, but the thing you have to realize is I don't have any takes on like AI or the future of robotics. Cause I'm not looking at all these keynotes and you know, robotic dog demos. I'm looking for robotic tile layers and rebar benders and things that are only in real estate.
So with that said, all of my comments are very specific you know, 80 or 90 vendors that I had to needle in a haystack there that are just selling to real estate and construction. And so my take is it was good, [00:08:00] not amazing and fascinating to see where things are going. There is a huge international presence that I think we're missing in a lot of our PropTech events.
I mean, Korea in particular, it's just blows me away with the amount of innovation in Korea. And obviously China has all the OEMs there. Japan's got a big presence there, but European countries. And so, I wouldn't say there's one big trend I would take away other than it's just really impressive.
It's really overwhelming. And I found probably 60 companies that were in conversations, various stages of conversations with that. Hopefully we can bring to different PropTech events this year.
Chris Moreno: That's great. Now I, I, I'm excited. I guess I'll ask you, you know, I love seeing and feeling and touching the, the hardware software combinations that can come because I, the hard thing for them is that it's incredibly expensive, right?
You don't have the 98%, generally 98%. margins that you do because you have installation, you have maintenance, you have hardware, physical [00:09:00] goods that you do on just software. And so it's easy for software companies to go to shows, to get out there, to meet people, whereas hardware companies tend, you know, a lot of VCs tend to not want to invest as much capital or they're way, way harder to get to show.
So I love that you do that. When you think about this, you know, what is your goal for this year to get these companies out there? Is there, is there a strategy of a number of companies? Is it, is it getting more and more out there to as many shows as possible?
Matt Knight: I don't know that number is as important to me as new and interesting because at the end of the day, with the nonprofit part of what I do, if we're not bringing cool tech that people want to see in touch at events, we're not really doing our job right.
And so, cool. I could bring you a robotic dog. That's kind of a cool, neat little trick, but will it actually make your real estate better or more valuable in your tenants will say, you know, no, right. So it has to be in that sweet spot of it's interesting. It's usable. I can pay for it because a lot of the things for us at CES are just prototypes.
So there's a [00:10:00] cool prototype cars and boats and you know, and it's not really ready for the market. So you have to sort of be like this market ready. I can sell into owners and managers and I can make your building like, you know, faster, cheaper, more profitable, better. And so our goal is just bring new people in in addition to the wonderful people we brought in last year and the year before, and then have people pay them for their thing.
That's that's the goal. And so I know that seems vague, but that really without getting into each event, because we will. We will staff our booth for Blueprint, different than we would staff one if we were going to go to Inman with you, right? Or different than we would do Optech, right? So, everyone's a little unique in kind of who their main attendee is, and that will dictate the companies we come to sell those attendees, if that makes sense.
Chris Moreno: Yeah, it does. I mean you know, even thinking about like Inman coming up in, in New York. And you know, you've got obviously the REACH team will be there. You've got Serhant, you've got some investors obviously more on the resi [00:11:00] side and brokerage side. You know this is actually my first time going to that, but I'm kind of curious, because obviously, you know, the, the brokers aren't looking at as much at, at hardware per se.
Is that correct? They're looking more at smart tech, more probably like just straight software and how to, how to grow their networks, grow their customer basis. Or are they also looking at hardware? I'm kind of curious to get your take on that.
Matt Knight: Yes. And no, I mean, there's, you know, smart locks for touring and there's touring tech and, you know, Matterport and you have to get in there and take 3d tours.
So there, there is some hardware to it, but yes, you're, you're right. It's most of the things. We see that come across our desk for realtors and brokers is a lot of relationship based things, lead generation, data, data sets process streamlining, process management, things like that. It tends to be what I see the most of, but there is, there is a little bit of hardware in it.
Chris Moreno: Yeah, and I guess, you know, as we're thinking about you know, the economy and thinking [00:12:00] about interest rates and all those things we can totally not affect, and we'll probably go the opposite direction we prognosticate. Have you heard anything in the first two weeks of the year around cap rates, around interest rates, around deals, you know, and people getting deals done?
You know, do we think, do you see that happening in the next couple weeks? Do you think it's going to be happening you know, are you already seeing it happening?
Matt Knight: Yeah, I guess what I would say, and maybe this is where we wrap, is I'll give you my take, you give me your take, but what I'm hearing and I'm curious if you hear this at NMHC, is just optimism, right?
I don't know that it's specifics around a university. A target rate of any kind it's more Hey, the dam is burst and deals are going to get done this year. And so it's to me Maybe i'm giving a cowardly prediction, but it's like ask me in 90 days We have 20 transactions to point out both on the real estate side and on the tech side and say oh This is where the market is now because I think that was the problem last year is There weren't enough deals to give any trend Any [00:13:00] like meaningful trend lines You So I'm just hearing broader optimism and I'm curious if you're hearing something else.
Chris Moreno: Yeah. So two things. I think definitely there was a lot of optimism in December, especially when I was out in Arizona and people are starting to make headway. I think I'm hearing a ton of people being able to raise capital. Over the last few weeks. So that's been really excited to hear capital getting getting moving and in fundraising happening.
I think if you can get the deal makers together, so that's going to happen in two weeks, they will make the deals happen. I think face to face people are a lot more willing to make the deal happen, get to the number that needs to happen to make it work. Whereas remotely, Yeah. It's a lot harder to make that happen.
You get people in a room, you get over. I I'm a big believer that in real life, you get someone together, you hash it out, you have a drink, you have a coffee, you have a meal. [00:14:00] And you, you, you form the trust and it moves deals forward. So I think we're going to see a lot of movement because you have the people in the room who need to make the decisions and they can be real and honest of, of pushing things forward.
So that's what I get really excited about is seeing all the players rather than. You know, one person seeing something and saying, we'll get to it. And then they get to it six months later. I think that's what happens a lot of times between these deals. And even in technology.
Matt Knight: It's almost like you're playing on the sunk cost fallacy from economics, where it's, I spent all this time and money and effort to be here in person, I might as well get a deal done.
Chris Moreno: Exactly. You got to make the ROI, right? And if you, if you didn't, if you went out and you didn't see enough deals, you didn't have enough meetings, you didn't have enough deals to move forward in the next month or two, well then how are you going to eat? How are you going to justify it? So I know a lot of people have been shifting jobs even.
That's something maybe we talk about our next one. But, you know, I'm hearing a lot of people looking for their new jobs, but or, or thinking about where they're wanting to go. And at the end of the day, the people who make it, make it happen, make it work. And I think that. I am [00:15:00] hearing more people raising funds right now that couldn't raise just in October, November, and, the dollars are starting to flow.
The meetings are starting to happen in January, February, March. To your point about acquisitions, I think we're seeing that about investors feeling better about cutting checks and looking for alternative investments here, right? And as we start seeing more exits, I think you'll see more angel and VC checks getting cut.
And I, you know, obviously the VCs on LinkedIn. And on YouTube who are posting, sharing these investments, right. That are happening. So, you know, obviously Butterfly this week had a big investment from Fifth Wall, you know, seeing, seeing a lot of that, you know, we'll see Camber Creek on stage, we'll see 1Sharpe we'll see Stellifi, we'll see Primary.
So I'm excited to hear all the deals that all these different firms are doing and what spaces are investing into.
Matt Knight: Well, enjoy New York, enjoy Vegas. And when we touch base next month, I want to hear how it went and all the earth shattering realizations. You had
Chris Moreno: a hundred percent, Matt. We will, I will try to stay very focused.
There'll be no gambling on my part. But [00:16:00] yeah, there'll be a lot of, a lot of coffee meetings and a lot of sessions. And I always love to go and be curious and learn from people who have been through the cycles. That's, that's what I really try to do is put my ear to the pavement and let people share with me what they're seeing you know, straight up in their markets. So looking forward to it.
Matt Knight: look forward to hearing about it.
Chris Moreno: Thank you.
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