Investor confidence in proptech has waned slightly despite strong customer growth performance by the companies in their portfolios, according to MetaProp’s Year-End 2019 Global PropTech Confidence Index.
Confidence in proptech among investors dipped to 8.0 out of 10 on the index from 8.8 mid-2019 while confidence from startups held steady at 7.2 compared to 7.3 at the middle of last year.
Some 45% of investors surveyed said they plan to make more proptech investments in 2020 compared to the year before. This is down from six months ago when 64% said they planned to make more investments.
The survey is based on responses from more than 2300 proptech investors and startup founders.
Despite slightly lower confidence going into 2020, 81% of startups said it will be easier to raise venture capital at or about the same levels this year as they did in 2019.
One investor quoted in the report said “the impacts of WeWork are reverberating through the asset class,” and, as a result, startups can “expect to see a tougher fundraising environment from institutional VCs.”
Even though they have lower confidence, 86% of investors said the proptech companies currently in their portfolio are performing above expectations or meeting expectations for customer growth.
“To me, this period’s results demonstrate proptech’s resilience. Both proptech investors and proptech startups clearly believe that technology-led innovation will remain a growth engine and value driver for the real estate industry,” said Aaron Block, co-Founder and managing partner at MetaProp. “I’m particularly encouraged by the investors’ consistent optimism.”