On this episode of REALtalk, Courtney Cooper, Principal, Alate Partners, joins REALPAC’s Brooks Barnett, Director, Government Relations & Policy, to discuss Proptech in Canada, the establishment of the Proptech Collective, and the future of the industry in Canada.
The episode covers:
- The quickly evolving Canadian property technology space
- The establishment of the Proptech Collective
- The size and scope of the Canadian Proptech market
- The impact of the Canadian Proptech community on the wider built innovation movement
- Aspects of the Canadian ecosystem that make it so attractive for Proptechs
- How can we grow talent in the industry?
- Creating a more diverse CRE industry through Proptech
- Trends we are seeing coast to coast
- Prospects for growth in the industry
About Courtney Cooper:
Courtney is a principal at Alate Partners. In this role, she helps identify and scale promising real estate technology companies, provides market analysis and due diligence, and manages relationships with industry partners.
Courtney has spent most of her career in real estate —including more than four years at Dream, leading innovation and business transformation initiatives. She went on to work as an Innovation Strategist at Great-West Life, where she helped one of Canada’s largest financial institutions analyze new markets and identify opportunities for growth.
Michael Brooks (REALPAC): Hello, everyone, thanks for listening and welcome to REALtalk, the show that brings you unique insights from leaders in Canadian and international commercial real estate. I’m Michael Brooks, CEO of REALPAC. We have with us today is guest host Brooks Barnett, REALPAC, Director of Government Relations and Policy.
Brooks Barnett (REALPAC): Thank you, Michael. Today, we are talking Proptech. And if you’re an active follower of the quickly evolving Canadian property technology space, my guest should be no stranger. I’ll be talking to Courtney Cooper about Canada’s Proptech scene, trends we are seeing coast to coast and prospects for the growth of the industry. Courtney is a principal at Alate Partners, where she helps identify and scale promising real estate technology companies, provides market analysis and due diligence, and manages relationships with industry partners. She works directly with Proptech companies and is a board observer for some of the biggest Canadian Proptech firms, including Lane, Branch, and Eden. In 2020, she co-founded Proptech Collective. More on that later. Courtney, welcome to REALtalk.
Courtney Cooper (Alate): Thanks so much for having me. I’m excited to talk to you guys today.
Brooks Barnett (REALPAC): Courtney, before we get into the formal part of our discussion, I wanted to ask about a dog that you had that act or acts like a beaver.
Courtney Cooper (Alate): Yeah, we got Dallas in March of 2020. So Pandemic Puppy, as they call it. And we went to pick him up from the breeder. His given name was Super Beaver Mike. So the breeder thought that he ate like a beaver or something like that. But it turns out that he actually does love to bring home tons of the biggest sticks he can find. I would call them logs, so does have some beaver like tendencies.
Brooks Barnett (REALPAC): Well, listen, Courtney, getting into it, I thought we’d start today with a little bit about Alate and then move to talk about Proptech Collective. So, you know, how did you start and move into the real estate space and what are you doing at Alate?
Courtney Cooper (Alate): So we found Alate in 2018. So we’ve been investing for the last 2.5 years. It was Dream Relay Ventures. Relay Ventures is a large Canadian venture fund focused on that as more generalist focus. And they teamed up with Dream, who I’m sure your audience is familiar with, to focus on investing in real estate technology and anything that can help improve the build.
Brooks Barnett (REALPAC): And Property Collective was born in 2020. That’s an initiative that I see some others from the industry are attached to. Can you tell us a little bit Protech Collective what you’re looking to accomplish there and how you’re looking to accomplish it?
Courtney Cooper (Alate): We founded Proptech Collective, actually, out of another initiative called Women in Protech. We rebranded it in 2020. But this is something we’ve been working on for a couple of years. And really what we’re focused on the Collective is how can we bring together all of the right people that are in the room. Right now there’s a lot of amazing, amazing tech companies and tech entrepreneurs that are focused on building solutions. And there’s a lot of real estate companies and real estate associations that are working on innovation, but often times they’re not talking to one another. So really what we’re trying to do is create a platform where these groups can come together. And we thought a lot about this because there’s lots of great organizations like REALPAC, like ULI, NAIOP, so many others. And so what we’re hoping to do is be able to work with those groups that are mostly real estate focused and help bring in the technology perspective and some other groups so that we can work on solving better solutions together.
Brooks Barnett (REALPAC): I read with great interest and congratulations to you and your team on the release of your first report Proptech in Canada – 2021 report. There’s a lot of really positive fanfare around that. I read the report with great interest. Why was it important for your team to start with the report and really do the mapping around the Proptech ecosystem in Canada? And how did you go about that work? Because, I would think that that would be such a monumental task, just trying to understand who all the players are and where they are. How did you do it and why did you want to start with this report?
Courtney Cooper (Alate): So the report did start out of curiosity and interest. It wasn’t like we went about saying, hey, we’re going to go publish a 50-page report. I think that it was October or November of last year. And a couple of us were talking and we didn’t know the answers. How many tech companies are in Canada? Where are they focus? Which cities are growing? And so we just started out of curiosity to say, OK, let’s do an investigation and do some research into this. And then it grew and expanded over time. But I think that it is really important to be able to understand what is happening here, who the companies are, how many companies we have, and just create a baseline of knowledge, because right now the information is a bit scattered. I talk to you and to the team in our labs and asked does anyone have a list? Does anyone know? And there are lists that exist on Pitchbook and others, which is where we went to start our look as well. But we didn’t feel like any of them had the landscape mapped out in a way that helped us really understand it. So that’s where we decided to create our own.
Brooks Barnett (REALPAC): Were you surprised that there were more than 300 Proptech companies in Canada?
Courtney Cooper (Alate): I knew there were a lot. And I think that is a lot. I knew a lot of them, but I spent the last two and half years on this and there’s no way to know them all. One of the questions that we talked is how do you define Proptech, what is and what isn’t? We started from a framework that existed. So Tom Best publishes a US market map that’s similar to this one. And so that was the best framework that we had because it categorized companies in a way that was pretty easy to understand. So within real estate, what kind of technology helps you find properties versus evaluate, manage and then you utilize the assets? And so that’s the starting point that we used. And it’s not easy, though. Companies or companies are changing. A lot of these companies are early and they can fit into multiple categories or might change over time. So it’s a starting point and allows us to at least start to bucket where there is momentum and areas where there’s a lot of companies getting started or companies that are growing.
Brooks Barnett (REALPAC): If you are following the space, you know that there are some around the world who have claimed in the past that there are in excess of 8000 or so tech companies now in existence. If Canada is around 310, somewhere in there, it is still somewhat a microcosm of the larger whole. But is it possible at this point to figure out what the Canadian impact on the Proptech movement is? Or is it still early in the ballgame to be able to make a comment like that?
Courtney Cooper (Alate): So I think the ecosystem is still early and growing. We’ve got some great companies. We highlighted some of the biggest companies in the report. So means that, you know, like Sonder and Breather and Lane and others. So there’s a lot of great companies that are here, and the other ones that have grown more have a more global footprint at this point. But at the same time, there’s a lot of really amazing companies that are at that seed and Series A stage that are working with large real estate companies or building solutions so consumers can make it easier to buy houses, things like that. So there’s a lot that’s up and coming and that I’m excited about. When I look at this list, there’s a lot of companies that I think have the potential to have a huge impact.
Brooks Barnett (REALPAC): I wonder if you can shed some light on the findings when it comes to the large corporates. And how they’re approaching the question of tech and innovation.
Courtney Cooper (Alate): So we highlighted a few in the report and you can see on one of the pages we kind of mapped out the different categories that we have. And the one thing I’d say is I think every real estate company is doing something in the space. Some are more sophisticated and have clearer strategies. Others are just maybe partnering with different tech companies and still sort of trying to figure out what their strategy is. We saw a lot more sort of balance sheet investments prior to the pandemic. So having companies like Honest Buildings and BTS that got a lot of investments from Canadian companies and pension funds. There’s a number of them that have also supported smaller Canadian companies. I don’t know which ones are public, but we aren’t. We were seeing a lot more investment. Now I think companies and real estate companies that focus on their core business and they may still make some balancing investments, but a lot of them are thinking about how do they build an internal innovation teams or internal groups that focus on how do they work with these tech companies, how do they build sort of data capabilities and their own strategies? I think overall we’re starting to see just more holistic approaches where people are trying to figure out how Proptech fits into their strategy. And to me, it kind of is thought of as this thing over there. But really it’s technology that supports and enables your business.
Brooks Barnett (REALPAC): The report talks a lot about the ecosystem and how strong the foundation, the Canadian ecosystem actually is. I wonder, can you share any thoughts on why that strength exists and what it is about the Canadian Proptech ecosystem that is so attractive for both companies that are from Canada and want to remain in Canada, but also companies from outside of Canada that are looking within our borders as a place to settle and grow. What is it that makes our ecosystem so attractive?
Courtney Cooper (Alate): It always surprises me how big an impact the Canadian real estate ecosystem is. Ten of the top 50 global, institutional, real estate investors in 2020 are Canadian. Companies like Brookfield, Oxford, Tricon, Empire, Dream. There’s just so many incredible real estate companies that are based here and are thinking innovatively about their businesses and starting to adopt tech. So I think from that perspective, having just great customers who are both on the real estate side as well as construction. EllisDon, PCL, these are big customers that are really making an impact when they start to think differently about their businesses. In terms of the rest of the ecosystem: we are seeing Canadian companies grow here based on the access to talent, support for innovation, friendly immigration policies, health. And we’re starting to see Toronto and the rest of Canada become a destination for a second office or for even to found your company here, because it’s a great location. Just that sort of mix of having the right customers, the right domain expertise in the space, as well as access to talent friendly immigration policies and just the general support for innovation.
Brooks Barnett (REALPAC): That’s very interesting. You talk a lot about talent. Do we have the pipeline we need on talent? Do we have the right skill sets generally to drive the industry forward to that next stage? I wonder if in a place like the GTA, obviously with the amount of universities and colleges that exist there, that answer probably is self apparent. There are much, much more parts of the property technology landscape that exist outside of the GTA. However, obviously, as we know through your report, do we have that talent pipeline nationally yet?
Courtney Cooper (Alate): Generally, I think yes, I think we’re getting there like we are seeing that Proptech companies are located in five main hubs and it wouldn’t surprise you that it is the GTA, Vancouver or Montreal, Calgary, Kitchener or Waterloo. But we’re also seeing great companies get started out of Edmonton and other places in Quebec and in the Atlantic region. So I think that there are Proptech companies getting started everywhere. You talked about the education system and we have a very educated population and we’ve got tons of talent coming into the industry, both on the tech side and the real estate side. I think that there are still gaps and I don’t think this is a Canada thing. I think generally there are gaps. And we think about, OK, what is the future of real estate and how does technology help that and how does technology really help my business? So I get a lot of questions from senior people, even sort of CTOs and CIOs. How do we really think of AI and what does that mean and where can I use that in the business? Aa hard thing because people hear these words like big data, AI, blockhain, but what does it actually mean for me and what does that mean that I need to do differently or I need to learn? So I think that there is room on that side. What does technology actually mean and how can we use it? You don’t need to be experts and we don’t need everyone to be experts.
Courtney Cooper (Alate): Like, I think the beauty is that the technology will make it easier and you won’t actually need to know all of these things. But there are some skill sets that I think that we’ll need to get developed and changed over time. And then on the tech side again, and this is part of the reason why we started Proptech Collective is there’s a lot of people that come into the industry and they are incredible technical talent. They’re really innovative thinkers. But real estate in construction – some of the reasons why is behind in technology are structural. You can’t just come in. There’s regulations. When you’re working with GCs, the government, real estate companies and owners and lenders, there’s a lot of people that are required to be coordinated. And so to change things can be difficult. And so I think that the domain expertise is really important. So on the tech side, it’s good to have new thinking and new kinds of ideas, but I think you need to pair that with people who understand why things are the way they are. And what are the levers that are that you are able to change and how you do that sort of quickly and efficiently. So I think that we’re getting there, but it’s that we need to keep working to.
Brooks Barnett (REALPAC): Yeah, and the whole question about getting there, I think, kind of leads to people. We know one of the major takeaways from the report for me was that clearly the industry is quickly evolving and the speed at which innovation is taking hold is steady and only really picking up steam. We’re starting to slowly build and shape commercial real estate industry that is much more progressive and future focused. But part of that, I think, means recognizing that we have a lot more to do on justice, equity, diversity, inclusion and building a workforce in the industry that is much more diverse than it ever has been. So my question is really about Proptech and that greater JEDI movement. Do you see ProTech factoring into that? I think about the people attached to some of the start-ups and ventures, incredibly diverse group of professionals that are connected to Proptech. Is that the opportunity in terms of diversity in the industry or one of them?
Courtney Cooper (Alate): So I think that a lot of people who are going to work at tech companies, especially if you’re making the leap to work at a new company, something that’s fast growing – you have to believe in the mission. You have to believe that it has in it that this company can be grow big and make a lot of money and solve real problems. But you also need to believe in the founders and the team and the solution. So I think that that’s why a lot of times tech companies, they attract that kind of energy and talent. And so we’re seeing sort of more diverse talent. And a lot of these companies, tech still has diversity issues. I do think that’s changing. I think that there’s a big push towards ESG and particularly on the environmental side, but also how do we create better cities, more affordability or inclusivity? So I think that it plays a role, but not alone. I think that there is the Black North Initiative. There is DMZ has other initiatives. So I think there’s a lot of groups that are really thinking about how do we add more diversity into the real estate industry. And then on the other side, real estate impacts every part of our lives. It’s the places where we live, in the places that we work, it’s the construction process. And building operations has a big impact on our environment and climate. So I think that Proptech or the real estate technology ecosystem can support the goals of the real estate companies have around ESG and diversity, but it’s got to come from everywhere.
Brooks Barnett (REALPAC): Courtney, thanks so much for joining us today and talking about innovation in real estate. I’m already looking forward to our next talk when we can look back at 2021 and see how far Proptech in Canada has grown.
Courtney Cooper (Alate): Thanks so much to Brooks, Michael and the whole REALPAC team for having me today.
Michael Brooks (REALPAC): Well, this is Michael Brooks and that’s it for this week’s episode of REALtalk. Be sure to visit us at Realpac.ca/REALtalk and subscribe wherever you get your favorite podcast. If you have an idea for a topic or a guest, please send me an email at firstname.lastname@example.org. And if you like what you hear, give us a five-star rating. Thank you for listening and tune in next time.