The UK’s leading proptech investment fund manager Faisal Butt has said that not enough proptech start-ups are maturing into real businesses and that this year will see the weaker ones ‘weeded out’.
Butt is both the founder of Pi Labs, Europe’s first tech-focussed property venture capital platform, and also a personal investor in the sector via his company Spire Investments, which he founded with TV star James Caan.
The two organisations have investments in lender Trussle, AI property management app AskPorter and rental start-up Propoly, while Pilabs was a significant investor in eMoov.
His comments were made during an interview with US business magazine Forbes, during which he also says that US money will begin pouring into UK proptech this year, although “there will be a weeding out of low-quality, under-performing start-ups that are not well [funded] or have sub-optimal teams,” he says.
First time buyers
The 30-something also says 2019 will see rapid growth in the number of tech firms setting up to help wannabe first time buyers realise their dream.
“I think there will be some interesting ideas on how new start-ups that sit at the intersection of FinTech and PropTech can help solve this problem,” he says.
In the Forbes article, Butt is joined by a fellow proptech investor from the US called John Helm, who says he is worried about the punchy valuations some tech-driven property start-ups attract.
Helm says that the proptech sector is currently at the top of its ‘venture cycle’ and so as the economy turns, “these valuations will come down to their natural level”, he says.