Venture capital firm Fifth Wall produces a bi-weekly newsletter that curates relevant news articles, summarizes recent deals and provides updates on the various portfolio companies in which they’ve invested.
Check out this week’s update, which covers underwater warehouses, flying cars and cable-free elevators.
What we’re reading
- “Amazon files patent for underwater warehouses” (Dezeen): Amazon recently filed a patent for an underwater warehouse that utilizes CO2 canisters triggered by acoustic sound waves in order to bring packages to surface. Yes, you read that correctly:
- “Amazon poised to debut real estate referral service” (Inman): Adding to its ever-expanding product offering, Amazon also “accidentally” released a feature called “Hire a Realtor,” indicating the company’s first ever foray into the world of real estate.
- “Apple unveils smart home experiences in its retail stores worldwide” (TechCrunch): Apple, hot on Amazon’s heels, introduced a real estate offering of its own, adding in-store smart home device testing to 46 of its retail locations.
- “The flying car may be getting off the ground” (WSJ): We’ve written extensively about autonomous vehicles and their prospective impact on real estate, prompting some to suggest we are putting the cart before the horse. Perhaps we should, instead, be putting the bird before the horse? Flying cars might be on their way.
- “World’s first cable-free elevator zooms horizontally and vertically using maglev” (MIT Technology Review): Everyone’s Willy Wonka fantasy come true! These elevators can go sideways, slantways, longways and backways.
- “How technology can eliminate traffic congestion” (WSJ): With apps, GPS and other tools, roadway officials can track traffic and set prices in real time. Then drivers will get updates about traffic conditions and costs — letting them decide as they travel if they want to pay more to take a crowded road or pay less to use an emptier one.
- “The future of U.S. train travel” (WSJ): A captivating debate about the future use cases — or even the long-term viability — of high-speed rails.
- “Airbnb readies a premium tier to compete more with hotels, sources say” (Bloomberg): As it continues to infringe on territory once reserved for the hotel industry, Airbnb is introducing inspectors to verify the quality of its higher-end offerings.
- “The co-working trend comes to biotech” (WSJ): Co-working spaces are happening in different industries, confirming the fact that the distributed workforce is a trend — and not a fad.
- “How AI is transforming cities around the world” (blueprint): Artifical intelligence — the hottest buzzword in Silicon Valley — is real and is transforming the cities we live in in very tangible ways.
- “There are more renters than any time since 1965” (CNBC): Renters’ top regret is wishing they had bought; read about the drivers behind the recent spike in renters across the country.
- “Air rights: the final real estate frontier” (blueprint): Major metropolitan areas are already densely developed, prompting some developers to buy “air rights” to the usable space above buildings.
- “An AI that predicts a neighborhood’s wealth from space” (WIRED): Penny, an AI that uses satellite imagery to predict income levels, is providing a glimpse into how the tech-world is trying to use image-capture to make sense of vast swaths of land.
- “The rise and fall of working from home” (Bloomberg): The permanent telecommuter is a fad that is dying fast — lenient work-from-home policies have led to falls in production. Physical office space isn’t going anywhere.
- “The next job humans lose to robots: real estate appraiser” (Bloomberg): Advances in big data at Zillow and elsewhere are helping automation creep into knowledge-based professions — whether this spells the end of appraisers as we know them (or period) remains to be seen.
- “Bluetooth mesh networking could connect smart devices city-wide” (Engadget): Bluetooth technology will link thousands of intelligent devices, including smart street lighting and connected vehicles.
Interesting ideas
A selection of relevant financing and M&A activity in our sector
- Redfin, the Seattle-based, tech-enabled residential real estate brokerage platform, has recently filed for an IPO, planning to sell 9.23 million shares with a price range of $12 to $14 per share. Growing market share in 81 out of 84 markets, Redfin generated $267 million in top-line revenue last year but posted a loss of $22 million.
- Houzz, a California-based e-commerce platform for browsing and testing interior design concepts, has raised $400 million in funding from lead investor, ICONIQ Capital, with participation from Sequoia, Zeev Ventures and GGV. This new round of financing values the startup at roughly $4 billion.
- Geek+, a Beijing-based developer of logistics robots, raised a $650 million series B round of funding led by Warburg Pincus and return backer, Volcanics Venture, has raised $60 million in Series B funding.
- Hutch, a Los Angeles-based virtual interior design app, has raised $10 million from the publicly-traded, online real estate platform Zillow.
- SpotHero, Chicago-based parking reservation platform, raised a $30 million Series C led by Global Founders Capital with participation from Autotech Ventures and Insight Venture Partners, among others.
- View, the designer of electrochromatic smart glass for buildings, closed an investment round of $200 million from BlackRock and TIAA Investments. This recent raise could potentially establish View as the newest unicorn, pushing its overall valuation to north of $1 billion.
- Transfix, New-York based logistics software and trucking marketplace, has raised a $42 million Series C round of financing let by NEA with participation from Canvas Ventures and Lerer Hippeau Ventures.
- Metail, the UK-based virtual fitting room platform, raised $12.8 million in Series B financing led by existing investor and clothing manufacturer TAL.
- Comtravo, Berlin-based travel booking suggestions platform utilizing users’ emails, raised $9.7 million in a Series A led by Project A and Creandum.
- Dalian Wanda Group, the Chinese real estate giant, has agreed to sell 76 hotels and investment stakes in 13 tourism projects for approximately $9.3 billion to Chinese property developer Sunac.
- Chengjia Apartment, Chinese apartment rental platform, has raised $50 million in a pre-A funding round from IDG Capital and Huazhu Hotels Group.
- Josh.ai, the Denver-based voice controlled home IoT automation platform, raised $8 million in new funding from undisclosed investors, bringing its total raised to $11 million.
- Miso Robotics, a California-based, AI-powered kitchen assistant robot, raised $3.1 million in funding from Acacia Research Corporation, Robotics VC and other undisclosed investors.
- URWork, the Chinese-based co-working unicorn, raised a strategic investment of $30 million from healthcare firm Aikang Group.
- Work Truck Solutions, a California-based inventory management platform for commercial trucking, raised a $5 million Series B led by Autotech Ventures with participation from Wakestream, Moneta, Belle Michigan and Golden Seeds.
- Open Listings, a Los Angeles-based platform to purchase homes without a broker, has raised $6.5 million in Series A funding led by Matrix Partners and were joined by new investors, Arena Ventures and Initialized Capital.
- Cabin, a San Francisco-based hospitality transportation service (formerly known as SleepBus), raised $3 million in seed funding from Founders Fund’s FF Angel, with participation from BoxGroup, Brainchild, FLOODGATE and SV Angel company, among others.
- Swift Navigation, San Francisco-based GPS technology developer to power autonomous vehicles, raised a $34 million Series B round of financing led by Forest Baskett and Greg Papadopoulos of New Enterprise Associates (NEA).
- SparkCognition, Austin-based AI-developer for finance, industrial and cyber security applications across IT, OT and IIoT platforms, raised $32 million in a Series B round led by Verizon Ventures with participation from Boeing.
- HomeBay, the San Diego-based tech-enabled service to help users sell and buy homes, raised a $5 million Series A from E15VC along with Foundation Capital and Serra Ventures.
- Flip, a New York-based platform to sublet and break leases, raised $2.2 million in seed funding from Union Square, Techstars and the Collaborative Fund.
- Stayawhile, a New York-based travelers’ platform for medium-term housing solutions, raised $1.5 million in seed funding from New Enterprise Associates (NEA), with participation from Founders Fund and Global Founders.
- iKongJian, a Chinese-based online platform for home renovation services, raised a $32 million Series C from the Chinese conglomerate Gome Holdings Group.
- Spruce, the San-Francisco-based provider of consumer financing for residential energy efficiency and solar technology, raised $25 million in new funding from HPS Investment Partners.
- Drive.ai, founded by former Stanford researchers and a developer of AI software for autonomous vehicles, raised a $50 million Series B from New Enterprise Associates (NEA), with participation from GGV and Northern Light Venture Capital.
- Homer Logistics, a New York-based last-mile delivery logistics provider, has raised $8.5 million in Series A financing led by Two Sigma Ventures, with participation from Lerer Hippeau Ventures, RSE Ventures and Laconia Capital Group.
- Centriq, a California-based platform to make home management simpler, raised $4.8 million from Office Depot, Ringleader and other investors.
- Duocaitou, a Chinese-based crowdfunding platform for multifamily and hotel projects, raised a $10 million Series A, led by CDM Ventures, with participation from Shunwei and others.
Deal Spotlight
WeWork raises $760 million in a Series G
After talks and multiple rumors about WeWork going public, last week the co-working giant announced it has raised an additional $760 million of new capital in a Series G led by Japan-based SoftBank Group.
This investment comes after a previous $300 million infusion in March of this year. This round originated from SoftBank’s $100 billion technology-focused private equity fund, known as the Vision Fund, and SoftBank indicated an interest of taking as large as a $3 billion position in WeWork, overall.
According to PitchBook, this new round of funding brings the total valuation of the company to over $21 billion, making it one of the largest real estate tech companies in the world. So large, in fact, that it exceeds the market caps of industry-leading real estate firms like Boston Properties ($18.25 billion) and Vornado ($17.7 billion).
The company has recently focused its efforts on building a more “traditionally corporate” structure, bringing in new executives to run both the co-working and co-living aspects of the business.
WeWork manages over 20 million square feet of property and is reportedly on track to reach $1 billion in revenue this year.
The latest from Fifth Wall and our portfolio
Here are some of Fifth Wall’s most recent investor and portfolio updates:
- We’ve released several episodes of the Fifth Wall Podcast, including interviews with Art Coppola (CEO of Macerich), Robyn Beavers (VP, Investments and Technology at Lennar), Nick Romito (CEO of VTS) and Vibhu Norby (CEO of b8ta). Check them out, subscribe, and be sure to tune in for more great content to come.
- Brendan Wallace wrote an op-ed titled “Brick and mortar retail is not dying: the future of brands in an omnichannel world” discussing the implications of the Walmart-Bonobos acquisition as well as the Amazon-Whole Foods acquisition for emerging brands and brick-and-mortar retail.
- At the end of last month, EGi released its list of the 50 most influential people in property tech — Brendan Wallace and Brad Greiwe shared the no. 10 spot. The article said: “Talk about a stealth entry. Most people hadn’t even heard of these guys a month or two ago.”
- Also featured in the top 50 is Chandra Dhandapani, CBRE’s chief digital and technology officer, at no. 6. Dhandapani recently sat down with Dallas Magazine to chat about her role at CBRE, a Fifth Wall investor, and we are lucky to work with talented executives like her.
- CBRE’s Senior Economic Advisor, Spencer Levy, was featured on CNBC’s Squawk Box to discuss CBRE’s annual report on recent tech trends. More specifically, Levy discussed the recent growth of tech companies and the markets that are generating the largest demand for, and supply of, tech talent outside of Silicon Valley. To read more about CBRE’s insight into tech talent, demographics and growth patterns, check out the rest of the 2017 Scoring Tech Talent report here.
You can learn more about Fifth Wall by visiting its website, and to subscribe to the firm’s newsletter, click here.