Michael Beckerman, Founder of The News Funnel and CEO of CREtech, joined us on the podcast to discuss how technology is impacting real estate.
Michael Beckerman is a leader in the commercial real estate tech sector. He entered the sector in 2012 after a 25-year career in commercial real estate public relations, in which he started and built Beckerman Public Relations into one of the largest firms in the country before eventually selling the agency.
Michael now serves as CEO of CRETech, the largest event, data and content platform in the commercial real estate tech sector. He also owns other successful brands such as The News Funnel, the largest commercial real estate news aggregator and The Content Funnel, a social media and blogging platform for the commercial real estate industry.
Michael blogs at www.cretech.com/michael-beckerman/ and is active on the commercial real estate tech speaking circuit.
- CREtech - CREtech is where the commercial real estate industry comes to discover all things tech.
- The News Funnel - The News Funnel is the largest content platform in the real estate industry, containing news from 5,000+ media sources and companies.
RealCrowd - All opinions expressed by Adam, Tyler, and podcast guests are solely their own opinions and do not reflect the opinion of RealCrowd. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. To gain a better understanding of the risks associated with commercial real estate investing, please consult your advisors.
Tyler Stewart - Hey listeners, Tyler here. Before we start today's episode, I wanted to quickly remind you to head to realcrowduniversity.com to enroll into our free six-week course on the fundamentals behind commercial real estate investing. That's realcrowduniversity.com. Thanks.
Adam Hooper - Hey Tyler.
Tyler Stewart - Hey Adam, how are you today?
Adam Hooper - Tyler, I am doing pretty well today.
Tyler Stewart - Yeah?
Adam Hooper - Yeah, I am.
Tyler Stewart - How come?
Adam Hooper - Well, we had another great episode. It's sunny out. We kind of harp on that a whole bunch here--
Tyler Stewart - We do.
Adam Hooper - But it's fall now. We got to take it for what we can here in Portland. Another good day though, another good episode, who is?
Tyler Stewart - Michael Beckerman who is the CEO of CREtech, and also the owner of The News Funnel.
Adam Hooper - Yeah, Michael is all things real estate media, and technology. You'll probably hear a lot of themes in this conversation today similar to what we talked with Brendan Wallace at Fifth Wall, kind of how technology is affecting the real estate space. We're seeing more of the investments in the space. We're seeing more of the traditional players start to adopt technology, and just again an embrace of technology industry finally, which is a nice thing to see.
Tyler Stewart - Michael is also a master of building relationships and networking in the commercial real estate space. He delved a bit into his secret tips for how to build relationships and how to go to networking events and get to know people and start to build mutually beneficial relationship.
Adam Hooper - Again, I also love his emphasis on basically being a never ending learning, always trying to identify new things and kind of grow your own knowledge base to make you a better investor, a better user of real estate, and just more knowledgeable overall.
Tyler Stewart - Continue to learn and continue to grow, and just develop those skills as a real estate investor.
Adam Hooper - Perfect. Well, as always, we love your feedback, we love your comments, ratings on iTunes, SoundCloud, Google Play, wherever you might listen to us. So with that, Tyler, let's get to it.
RealCrowd - This podcast is brought to you by RealCrowd, The leader in online real estate investing. Visit realcrowd.com to learn more about how we provide our members with direct access to commercial real estate investments. Don't forget to subscribe to the podcast on iTunes, Google Music, or SoundCloud. RealCrowd, invest smarter.
Adam Hooper - Michael thanks for joining us today. We're excited to talk a little bit more about what's going on in the real estate and technology world. Where are you joining us from today?
Michael Beckerman - Well thanks guys, I'm really excited to be on the podcast, I'm a big fan of the podcast and your platform. Today I'm fortunate to actually be home, for once in a long time. I don't know if my wife and kids are so thrilled about that, but I'm home in central New Jersey. Most days I am either in New York or I'm traveling, but today you find me in bucolic, horse country, central New Jersey.
Adam Hooper - Very nice, and we were just talking before we started recording, fresh off of the San Francisco conference you put together. You said about 500 in attendance there?
Michael Beckerman - Yeah, it was last Thursday we were in San Francisco, so I guess, depending on when this podcast airs, we were recently in San Francisco for our annual CREtech conference, and it was just an extraordinary event. It's become so much less about us as a company, and as a site and a platform, it's so much about, the industry and its evolution. The great thrill for me is to sit back as an audience member, in the back row or move around, listen to the crowd, and listen to the conversations. It's to see how much progress, you guys have been in this is for as long as I have, how much progress has really been made. I measure that by the quality of the conversation, the substance of the conversation, the speakers, the amount of transactions that are taking place at our conferences, and of course the size. Last time we had the CREtech San Francisco, it was about 500, as you said. Which was terrific. The other thing that's really great is that it's all food groups within the industry, so obviously it's heavy on the startups, but also now increasingly heavy on the investor side. We've got a lot of investors both institutional, and so we see private equity, as well as family office high network, individuals that are just angels that are looking to invest in this space. Then the occupiers, the developers, the landlords, then the service professionals, like the brokers, that want to discover tech. It's been an extraordinary evolution in this space, I'm blessed that I get sort of a first row seat on what's happening.
Adam Hooper - Good, well now take us a little bit back. We know you had a career and more of the public relations side, and then have transitioned now into what you're doing with CREtech. Why don't you take us a little bit through that transition, your background, and how you come to where you are today with CREtech.
Michael Beckerman - I started working I was in my early twenties. I had a love for media. I didn't really have much formal education, but I loved media, and I loved content, and so I thought that anything in that industry, that space, would be something that I would enjoy doing. I started a PR firm in the late 1980's, in a time when we were in the midst of a really horrific real estate cycle. Some of my first clients, as a publicist, were real estate. I found that there was a great void in an agency that specialized in mostly, commercial real estate, we did do some residential, but it was mostly commercial, multi-family office, retail, industrial hospitality. it took me a little time to figure out the importance of specializing in a particular industry. At some point I started to really see that this was a career path where I could build this agency, and we could focus on one category, commercial real estate. Worked really hard, scaled the business and got up to about 70 or 80 employees, and a couple of offices across the country, doing almost exclusively media relations. At that time , the media looked very different than it did today. There was actual print, there were actual magazines, there were actually very sophisticated reporters that were covering the beat. My job was to build brands using the media, and I did that for a very very long time. Then at some point in the late 2000's, I started to understand when this thing called the internet was really starting to get traction, the world of content was changing. Just look at what we're doing now,
Michael Beckerman - this is content, real crowds, podcasts, this extraordinary podcast, you're your own media, and I kind of saw this coming. It didn't take a rocket scientist that print was suffering, everything was going online. I eventually wanted to restart my career, wanted to reinvent myself. I just became completely bored with me, number one, and what I was doing. I worked on an exit plan and eventually was able to exit the agency. I wanted to go into something that I knew nothing about, that felt like real estate PR, 25-30 years ago. What wasn't happening in our industry? What wasn't anybody doing? That was in technology so, I migrated from the PR world. My first foray in this space was a site called The News Funnel, which is a content aggregator, it's the largest in the industry, so that was the first thing that I built. Our job and our focus there is to take all of this wonderful content that, folks like RealCrowd and startups, but also just real estate companies were doing, and distribute that to the industry. We built that and it's really thriving and taking off. I had an opportunity cause I really got into the tech world as a founder myself, to acquire CREtech about two years ago, which was, well you guys were a part of it, which was really kind of a volunteer community of founders that which were getting together and having some small meet-ups and talking about real estate tech. I saw that it could be a lot more than it was, they needed some investment. The fellow that started @Pierce9ken, who became my partner,
Michael Beckerman - is a wonderful, wonderful ambassador for the industry. He was at CBRE, took a job at Airbnb, in their real estate department. He was sort of looking for a way to scale it, and we came along and bought it two years ago. So CREtech has come into my life in a meaningful way, and that's a big part of what we're doing everyday now as well.
Adam Hooper - Good. And just for listeners out there, CREtech, a great source of content like you said, maybe you can just take a couple of minutes and tell listeners what you guys are doing at CREtech, and how that might be beneficial for them to get on board.
Michael Beckerman - One of the things I found was, as a founder myself, building my own content platform at The News Funnel, that there was really no place for the industry, the real estate industry, to discover all of these startups, all of these great emerging technologies and platforms. When I bought CREtech, it was with the sole purpose of bringing technology to the real estate industry, and being this one hub for anybody to come and discover all theses great platforms, all these great tools, and also to just have the industry just connect. We got a hold of the company, we acquired it, we started to reinvest it, we rebuilt the website, so the website's a place where we're aggregating news everyday and distributing that. We hand-curate about ten stories in the industry, that we think are most noteworthy everyday, whether they're on funding announcements, new product launches, new hires, expansions, fundraising. We distribute that to our audience daily. We have a directory of startups there. We are doing a lot more there as well, we've pushed into consulting and advisory work. A big part of the platform is our events. We do large events in New York, San Francisco, LA, every year. You're looking at anywhere between 4 to 800 at those events. Then we will do smaller regional events in Chicago, Austin, we're thinking about going to Seattle. That's where someone will say, "Hey, we want to bring CREtech to our community. We want to try and spread the word about what's going on in commercial real estate technology. Will you guys come?"
Michael Beckerman - That's core to our mission, so we're like, "Absolutely." We work with local startups, or local developers or owners, or investors, to help bring the community to their location. At the events, we are not a pay-to-play platform, so our speakers are 100% curated for merit and content. That's very heavily me, and what I'm picking, that is interesting. You'll come to the event and you'll see startups have booths. You could see anywhere from 30 to 40 to 50 start-ups, and they're really terrific. Then at the speaking level we'll usually have something to do with venture investing or angel investing, and we'll get a bunch of investors together and talk about what they're investing in. What they see and what the hot topics are. Typically we'll get some of the commercial real estate brokerage firms, the big names, to come and speak, their CTO's and CIO's. Then we'll get developers to speak as well. Whether it's Hines, or Prologis, or Equity, or Boston Properties. Those are the one's that are talking about what they're investing in and what they're using, and what have you. It's great content and it's great connectivity, and networking, and the events are just really really scaling. Like we were talking before, the thing that I notice is that, it is the caliber of the conversation that people are having, it's not just these puzzled faces anymore, "How does this compare to that? How does this impact my business immediately?" There's also a lot of integration amongst the startups, that's happening.
Michael Beckerman - I would say in the two years that we've been doing the event side of CREtech, it's been extraordinary, the growth and evolution of this tech. We've got people coming, at the last event we had people from Europe, people from Asia, we had people come from New Zealand. All just extraordinary investors. I don't want to reveal all the names but, that aren't even speaking, that are just walking around, looking for opportunities to invest and to learn. I can't wait for the next one, which is LA.
Adam Hooper - You talk about caliber right, so just today you guys announced your leadership team. Looking through this roster, a lot of folks we know. You've got Tom and Rich, Tom Byrne and Rich Boyle, early LoopNet. You've got Brad and Brennan at Fifth Wall. You got Colliers, Berkadia, Elie, formerly of CBRE, now Metaprop. JLL, Pierce at Airbnb, Newmark Knight Frank, ICSC. Our friend Steve Weikal at MIT. That's a pretty solid list of folks that are involved in this.
Michael Beckerman - Yeah thanks. Our mutual friend Steve Weikal is just another one of our partners. Important I mention the event that we do with Steve and the MIT Center for Real Estate in Boston, We did our first together this year, and it was just extraordinary. Anytime you do anything with Steve and the Center, you know it's going to be great. Our two companies combined really produce something amazing. Steve speaks at a lot of our events, he spoke at our recent Atlanta meet-up. The thing about the leadership board is, what we're really trying to do is advance the conversation to really elevate it, and I don't consider myself a quote-unquote, tech person. I consider myself an infinite learner. somebody that's constantly trying to take my own knowledge to the next level, and push myself, and challenge myself. Technology is not something that is intuitively, guess cause I'm old , I'm 53. That I was not born with a phone or swiping in my hand. I'm constantly learning, and the way that I learn is to surround myself with the best and the brightest people that I can find. That's the leadership board, and those are people that we will frequently just tap into and say, "What does this space look like? What are your thought on driver-less cars? What are your thoughts on Blockchain, or AI?" Whatever the topics are. Just to give us some feedback, and also to create some content for us, so they'd be blogging for us. We're not journalist, we want to crowdsource the best content. That's the purpose of the leadership board.
Adam Hooper - A lot of that and I think, the real estate industry, has always been about relationships and networking, and I think that's one of the things we try to do here at RealCrowd is, bring people that, historically didn't have access to that network, primarily on the investor side, with real estate managers, and try to build that network through this digital media versus traditionally just the dinner meetings or golf rounds, whatever that might be. What is your approach or secret or how do you approach networking and building this kind of collective of such high caliber people? Is there anything special that you're doing, or secret that you're doing, or is it just a genuine enthusiasm for what's going on, and that just kind of builds on itself?
Michael Beckerman - It's a terrific question, thank you. It's one I was actually talking with a couple founders the other day. We got together in New York and we were talking about building their particular platforms, and how they went about it. The general consensus, and the exact same thing that I found myself is, it's a very very physical business. The reason for that, and what I mean by that is, you have to go out meet and talk to everybody you possibly can. We're in a new industry, an emerging industry. One that is not mature in the sense that there's no central place for people to connect. It's not something that you can merely use social media for, or organically grow. We've got to take, and RealCrowd's done amazing, this is why you guys have been so successful. you have to literally take your product, get it to the market, get in front of people, and see them. Demo the product or just meet with them. Everyday, in my case for instance, I take virtually every call from every startup that wants to demo their product to me, and I simply say "How can I help? What can I do to help you?" Everybody's boat rises then, alright. "So what are you looking for? Are you looking for introductions for investors? Are you looking for introductions to get adoption?" And it's the same thing on the investor side. "What are you looking for? Are you looking for deal flow? What can I do to help?" It's very very physical, the networking. I go out, I meet, I travel. That's why we go, we'll do an event in Atlanta. We'll do one in Austin. We'll go to any place we can where people want
Michael Beckerman - to talk about commercial real estate technology, because we have to physically build this thing. This is the largest business category in the world, real estate, and there's no tech ecosystem. Of course if you are in consumer tech, or even fintech now is a mature industry, as you guys know well. Healthcare is coming along pretty aggressively, there's big conferences in all those categories. Even Blockchain now, it has its own sort of ecosystem. Our world doesn't have one yet. So the only way we're going to do this is, we just have to go out and old school network. Like I did 30 years ago. Thankfully I got the energy and stamina to do it . But it's a lot of work, but it's fun, it's exciting.
Adam Hooper - Now if listeners out there where to find themselves at an upcoming CREtech conference, they're not industry participants typically, right? They're kind of maybe coming from outside, maybe less of an ingrained kind of knowledge about the space. How would you suggest they approve something like that? Or when they're having conversations with the manager in the space? Educate themselves, and that's a lot of what we do with the podcast but, what would you say a good approach for people that are trying to get into the industry might take out when they go to conferences or have these conversations, and then start networking?
Michael Beckerman - What a wonderful question. I'm somebody that tries to do as much preparation as possible always so, when I'm meeting with somebody or I'm going somewhere, I really do a little bit of homework. I would suggest, let's say if you were coming to our most recent event in San Francisco. You go on to our website, you see who the startups are that are there. You try and schedule meetings with people, whether in advance, you get in a day before, or if you're local and it's easier to do. You can do it the day before or what have you. This is also what I tell people that want to get a job in the industry, or are looking to invest in the industry, or don't know what it is. Go talk to people. But set up meetings, do some homework, get there early, don't just show up and you get lost. I see it happen all the time. People show up, they get their name badge, and there's a crowd of 500. It's pretty intense, it's only 3 or 4 hours. It's not like it's 3 days, so that's a tough thing to navigate. Look at the thirty or forty or so startups that are there, look at who the speakers are. A lot of these speakers also open up their calendars to people as well. You could reach out to some of the speakers and just make a point do some preparation, both in knowledge and in connectivity. Again, just reach out for us and our team and say "Hey, we're coming to your XYZ event, how do we navigate? Can I get a few minutes with Mike?" We're a small company, about 10 of us, so we're extremely accessible. That's the best way.
Michael Beckerman - The worst way, I always find this, to show up blind, not have any real agenda. It's just common sense, just preparation.
Adam Hooper - Yeah, and engage, don't be afraid to engage and ask those questions.
Michael Beckerman - Yeah, again, completely. We take Q and A's afterwards, but again, I typically will see, we'll have some of the venture capitalist there, like one in the top names in the space, they get off the platform, and there's a line literally trying to get to them. Somebody will come up to me and say "Hey, can you get me to that one or that one?" I'm like, "I would love to try and help, but that's not the way to do it." Same way I would do it, if I went to a conference and I didn't know anything about it, I would literally connect to people on LinkedIn and say "Hey, I'm going to be at this event and I would love to meet up." You know, for coffee a bit before, or find them and go in, you know, just step into it, but do some homework in preparation.
Adam Hooper - One last bit on your recent conference in San Francisco. One of the ones that I always enjoyed going to is ICSC, the big convention in Las Vegas. That was always a good way to take the temperature and sentiment of the market. There's a ton of deal-makers there. You have investors, landlords, tenants, you got the whole gambit down there at ICSC. At your last conference in San Francisco, what would you say the sentiment was? I guess, just in terms of industry outlook. What's keeping people up at night? How was the energy in the overall real estate space at this conference?
Michael Beckerman - Wow.
Adam Hooper - We're hittin' you with the hard ones today.
Michael Beckerman - No, it's the good ones. Really good, I love these questions because they're really insightful. Which, I wouldn't expect anything less from you guys. It's interesting because I'm so, sort of deep into the ecosystem, and I'm talking to all the sectors, so I know the startup's pains. I know what the developers and the owners are doing, and I know what the brokers are trying to do. You can look at numbers and sort of see, you can get excited about how much money is, for instance, is being invested in the space. You go, whoa! Every year it's doubling, I mean it's literally doubling. Month-to-month, year-over-year basis, it's doubling. Now but, that's kind of misleading so the things that I look for is where's the traction, who else is growing and why, and what are companies trying to do with these tools. Are they deploying them or are they just investing in them? Et cetera. I think when I look at the sentiment, I look at it and say wow everything's going really fast, everything's growing, money's definitely coming in. JLL Spark, as you guys know, they just announced 100 million. Metaprop just raised 40, Camber Creek around the same, out of New York, and Fifth Wall with their 400, and many more that are coming. RXR in New York, and now it's 50 million from Ranmore, Brookfield, I think is 200 million. Prologis is massive in terms of their investment. That's real material progress. What I look for is, I really go deep into the ecosystem and say, "Where's the traction?"
Adam Hooper - But is anybody doing anything important that money?
Michael Beckerman - Correct.
Adam Hooper - Just putting money in the system is one thing, but what's actually being done with it. I think that's the bigger indicator, right?
Michael Beckerman - That's what I look for. Not to get too much into the weeds. I'm looking for which sites are brokers using more than others, which sites are investors using more than others, which sites? Is VR finally getting some traction or not? I mean obviously, really very little of the Blockchain, but it's a big topic. So what I really try and understand from my perspective, from my knowledge is, where's the traction. A lot of it's happening within organizations. If you could open up the boiler room into the big brokerage firm, and see what they're doing, and people inside are going to the HUD, you would see where traction is. That's what I look at. What are the brokers using, what are investors using, what platforms, what tools, and so, my takeaway is always, "Oh, that site is really scaling. That one is really scaling, or this one, they're not there yet." So that's one thing without giving you too much specific that . I think the thing is that I see, it could somebody going, "What's the takeaway, besides the individual sites that are scaling, and the money that's coming in?" We're at this point in the evolution of the space where we're starting to see startups and platforms integrate and work together, and collaborate via API's and what have you. I think that's a very very important trend in the space. You're starting to see multiple solutions come together to try and create a more coherent solution for the end user, and I think that's an important evolution. If you say to me, "What's the one sort of trend that
Michael Beckerman - you're starting sort of seeing?" I would say, "It's that!" The users of these products and these tools are saying, to the startups, "There's too many of you, and you're in too many silos. You need to understand from the user experience side, "that you need to make it simpler for us, and we can't bounce from app to app to app to app." I think we're at that stage in the evolution, and that's very very exciting.
Adam Hooper - That's one of the things that we focus on, so we recently partnered with IMS, Investor Management Services, to provide that backend process. That's what we've seen, and I would completely agree with you. Each one of these segments and each one of these companies that's attacking their specific segment, it's such a specialized business, that it's really hard to do one thing exceptionally well, and near impossible to do more than one. Mediocre at best. I agree with you, I think we will see more of that integration and partnering with best-in-class providers to make that end-to-end solution for the customers as seamless as possible, rather than everyone trying to build everything internal. Leveraging the best-in-class with these different silos. The more you can build an integrative platform across all those different services, I think that's going to be great for the industry.
Michael Beckerman - Well I remember meeting, I think you guys put that out sometime in May, about the IMS partnership. You used those words like seamless, end-to-end, life cycle. I read that and I was like, "Oh my gosh, these guys are so ahead of the curve." That's what your users are probably saying, "Yeah, give us more of that." That's just you, and this is why RealCrowd has done so well. It's really a breakout platform, is because you're really understanding what your users are looking for. Your customers, your clients. There's a tendency sometimes, as you know so well, when you're in tech, that you're just so focused on the tech. You're so focused on your own opportunities and challenges, that you don't listen much, and I think all of us get into those traps. That's why, when I saw that partnership, I was like, "Oh, yeah yeah, they're listening, they're listening. They're being very intuitive about what their clients are looking for." Kudos, kudos, you're ahead of the curve--
Adam Hooper - We're trying, we're trying. You mentioned VR, AR, autonomous vehicles, Blockchain, we've touched on a couple of those. What are some of the more exciting areas that you are tracking, or that you see potential in? What gets you excited about the technology space right now? Where do see some of those going?
Michael Beckerman - We had a very small event in Utah a couple months ago, we had about 50, really at the highest level, thought leaders in the space. We got together at this beautiful lodge, Stein Eriksen, in Utah We had speakers, the world's leading experts on Blockchain, cryptocurrency, and robotics, and what have you. I spent a lot of time reading and thinking, and talking about autonomous vehicles. I spent a lot of time talking to people about machine learning, and what have you. A lot of the stuff that we talked about is not practical today. It's not being implemented now. It has transformative powers and applications down the road. When that comes I think it's going to be extraordinary, I mean just the driverless cars, and the impact on all of us that either work, or live near cities, or what have you, Or what it can do. Parking garages, and the way we commute, congestion, and everything. But I think today, what's on the ground today. I think the biggest revolution that I see, The thing that is having the most impact is simply, data. And this is where you're at as well. First time in my lifetime, people in the industry have access, open access in many cases, to real-time data in ways and to degrees that have never existed before, that they can do so much more with now. Types of decisions they can make on investing, or leasing. So for instance, recently I was with Savills Studley, a massive tenant brokerage firm, who had built something with Leverton, an AI and data project that gives their professionals extraordinary access to information and trends that they never would have had a year or so ago.
Michael Beckerman - I could get into that for an hour but, it's too much in the weeds. More so than any time in my 30 year career in this space, it's all about dating now, and you look at companies like Reonomy or RealCrowd and or Comstack, it's just an extraordinary amount of data, which is transformative, both for investors, for occupiers, tenants, owners, developers. That I think, is the game changer in the industry now. It's the access to data and what it represents.
Adam Hooper - Now with some of those, what could be more transformative technologies that you mentioned, but now is not necessarily the time. Because you're talking to all the different sides of this equation, what do you see as some of those barriers for adoption? Is it just that the technology isn't advanced far enough that there's practical uses for it? Is there a resistance? Real estate is always been a fairly slow industry to adopt technology, period. We talked with Brendan Wallace at Fifth Wall, in a prior podcast. One of the things we talked about was, can I use a generation of executives coming into the space be much more embracing of technology, we grew up with it. Do you see that playing a role? What do you think is going to be one of the tipping points that gets more adoption with some of these more industry-changing technologies?
Michael Beckerman - Oh boy, my crystal ball right? Personally, let's say we're in a new world of data, and that's never going back, and that's the new reality, and it's wonderful, it's amazing. We're in that now, forever. Data used to be exclusive to either one company in our industry, or it would be exclusive to a professional, so I have information, and I have knowledge. Now flood gates are open, everybody's got it, anybody can get access to it. When I think about it, the most transformative I would say, obviously the blockchain. Then again, that hasn't even really materialized in other industries yet. I think that that could be extraordinary. That there is this open ledger that could profoundly impact the way that information is stored, and shared, and transacted. Again, moving this industry, this massive industry into the Blockchain, we haven't even been able to move this industry into virtual reality, or augmented reality--
Adam Hooper - Or even just what we're doing online with the same process as doing it on a website, right. We're having conversations today that we were having five and a half years ago when we first started the company, same conversations.
Michael Beckerman - Exactly, exactly, but I think the thing that I get most excited about, as a consumer, as a dad, as a commuter, is the autonomous vehicles. Every article that I read, I am like, I just hope that this comes sooner. I hope my kids don't have to ever drive. I don't have to go through these New York commutes anymore. I hope that in other parts of the country, DC, or Austin, or LA, that this can be a solution for traffic and congestion, and open up and make more green spaces. Get rid of parking garages. Just the way the cities are built, the design, and green spaces. I think the one I am personally most excited about, the one that I can't wait for, I never got my jet pack that the Jetsons told us was coming. If the driverless comes, the autonomous comes, when that comes, I think that's going to be very... you still got to get through regulatory issues, municipal issues. It just has so much potential. Again, from the horse and buggy to the car, hopefully from the car to the autonomous.
Tyler Stewart - Do you have any sense for the timing on when we might see some autonomous cars out there?
Michael Beckerman - It's so hard because, somebody's that not working at Google, or Lyft, or Jaguar, Uber. I'm not in Pittsburgh and I'm not in Silicon Valley. It's really just kind of what I read and who I talk to. We had a conference in La last year on this very topic, and the CEO of Gensler did an extraordinary presentation, led by a good friend of mine, Jeremy Neuer of CBRE. He was very very passionate about it as well. He went through this whole thing about what the future of design and construction looks like, et cetera. He had said five years. I've read other things that are sooner, and other things that are later. Hopefully we are not that far off, but I would say when you start to see them on the roads and having a material impact, I would say hopefully within the next five years but, your guess is as good as mine.
Adam Hooper - There's a lot of different avenues that can impact our space, and so we can kind of tie it back to our listeners on this podcast, as potential investors in real estate. How can some of this change or how will this change the investment landscape, or what are some of those hot points we should be looking out for, and maybe some resources that they can go to? Obviously CREtech. But to keep apprise on what's going on and start forming some opinions or thoughts on how that might affect their investment philosophy.
Michael Beckerman - As it relates to specifically real estate, right? Directly? It's really been the most transformative period in my career, in terms of the physical space over the last couple years, due to tech I attribute a lot of it, whether you're a fan of the company or not, I don't think you can dispute the impact that WeWork has had on physical space. I've been a tenant my whole life, I've invested. I have a lot of friends that are investors. On the office side, you cannot deny that paradigm has shifted, and in every city now there's coworking, in every community that it's available. That has real implications on the investing side and the ownership side, and we're starting to see it now. A lot of these conferences you're hearing major landlords changing the dynamics of their properties to accommodate a different kind of workforce. A workforce that wants to have more communal space. That's why you've seen startups like Convene thrive. Have more mixed use, so it's co-working, and it's retail, might even be some housing in there now, some residential.
Michael Beckerman - Fundamentally, WeWork has had a profound impact on the nature of occupancy, so that's really important, a trend that I think is here to stay, and growing. The other thing is e-commerce has just exploded, so if you look at the warehouse industrial space, there's no surprise as to why that's done so well for the last couple years, with the likes of Amazon, and what-have-you, really expanding. Also, I spend a lot of time looking at robotics within industrial, and listening to folks like Will O'Donnell at Prologis, and what they're doing. How buildings are being operated better through technology, is something that's really really interesting. It goes on and on and on and on, all of these technologies are having a real impact on the nature of space. What's the implication then on investing in that space, and what becomes the new hot product? You can come to these conferences and you can understand. I don't know that I would be owning parking garages anymore-- That's a good opportunity to start selling or what have you. There's also this whole trend towards office buildings becoming hotels.
Michael Beckerman - It's the way that they're configured, so that's something to really pay attention to. An investor co-living, same sort of thing. I don't think these things are bubbles, I think these are the real trends. If you just look at the demographics they all support, that the nature of physical space is changing and evolving, because of technology, and therefore there is a direct correlation to what is a good thing to be investing in or not. I'm not that smart, that's you guys, but, there's a correlation there.
Adam Hooper - It's what we talked about with Steve Weikal on our episode middle of last year, the whole concept of real estate fracking.
Michael Beckerman - He should get a dollar for every time someone mentions that now, cause he would be a multi-billionaire--
Adam Hooper - I'll send him a check. The concept for changing the nature of the use, right. You talk about data, don't kid yourself for a second that every time somebody walks in or out of the door, in any of WeWork spaces, they're collecting data on that. The insight how tenants use space, I think will have huge impacts on what gets done going forward. Like you said, no one's really ever had access to the amount, and the kind of data that we have now, and so, my thought on this is I think we're still early enough in that kind of data aggregation part of this phase, that once we have a meaningful dataset to start using to inform decisions going forward, that's when we'll start to see some even more dramatic changes. I think we're still trying to wrap our heads around how can we use this data, now that we have the ability to collect it. I'm curious to see what happens in the next 5 to 10 years. Once we have that dataset, how can we actually use that to inform these decisions were making about the usage of space or new development, or retrofits. I think it'll be interesting to see.
Michael Beckerman - Right, exactly right. That's really well said, spot on. If you think about it, like in my lifetime, the dynamic was, you sign a lease or you became the owner and you signed a lease with an occupier as the tenant. You're kind of done, that was it it would be five, seven, ten years, kind of wait till it rolls over, check back in and hopefully do it again, or whatever, figure out what they needed. That would also be on the multi-family side. You build the building, you get the tenant, and you see them when the lease rolls around. That's forever change. I do attribute a lot of it to WeWork, I do give them a lot of credit for being bold enough to re-think that dynamic, and say "Hey, there's another way, which is going to be short-term, and flexible, and creative." Like you said, "Now we're going to just put sensors on the ceilings, we're going to capture all your data, we're going to build apps to communicate with you while you're in our building, and we're going to know everything about you, on a real-time basis." That has never happened in this business. Who's in the building and what they're doing, is now captured, like you said. What everybody does with that, that's the next iteration. That's where the smartest investors will be, smartest landlords will be, understanding that data. In one of conversations we were having yesterday, one of the things I really try to write about in my blog, and whatever speaking opportunities I'm fortunate to get, is I'm really talking to people in my generation and my community and and say "Look." The other thing that's happening and that everybody
Michael Beckerman - should pay attention to, is that jobs will be lost. You're kidding yourself to think that technology plus real estate, equals efficiency, equals job losses, results of job losses. People are going to do more with less, it's why you're starting to see so many virtual assistants. Executive assistants are getting impacted or marketing people are getting impacted. But, on the flip side, there's great opportunity. So if you're somebody that loves research and data, go get whatever information you possibly can to educate yourself to become a data scientist in real estate, and you will go to the top of the food chain, based on what we were just talking about. That's a little side vent of mine. Trying to get people to wake up and see there are opportunities here, but there is also going to be some pain as a result, which always happens. I mean, one of the things that I always talk about and I know you know this world well, is like when I do my presentations is I always point to fintech and say, if you look at like, what AI or what machine learning and all have done to Wall Street and the financial community, I mean, there have been massive job losses that, and there's only more coming because they've gotten so efficient and I can't even know the number of stock brokers, or people that pick stocks that have been lost but so now we know it's coming to a hiring issue so get in front of it.
Michael Beckerman - Anyway, getting off topic but that's just, it's a passionate topic of mine-- The great opportunity here.
Adam Hooper - Well, lets take a minute if we can and just kind of go through maybe the four major food groups, you know, office, retail, industrial, multi-family. Maybe you can just kind of pick off by level maybe a couple, two or three, either interesting technologies or interesting companies that you're seeing in that space that you think we should be watching out for? Can we do that a little bit?
Michael Beckerman - Specific companies?
Adam Hooper - Yeah or just themes, right? Something like if we start with office, right, obviously you got We Work, co-working, you know, what are some other things that you're seeing maybe that will impact the office market?
Michael Beckerman - Without getting in too much trouble because I know our larger audiences, if I started picking off specific startups. On the office side, the big sort of theme right now is apps that are enabling landlords to communicate and bring amenities to the workplace. You're starting to see a lot more focused on applications that you can broadcast food services, you can do yoga classes. Whether it might be emergency situations to what have you is that, you know, the landlords are really waking up to the possibility, the potential, the opportunity, having direct communication with their specific tenants. On the office space, it's very, very sort of big into the community apps and communication apps, I think it's also obviously on the data, so on office it's very, very much about data right now, and I think again, that's not going away, so again, that calling out specific startups if you just, you know, looked into, you know, data, you'd find a lot of...
Michael Beckerman - Lot of the startups that are attracting the most amount of money are they're scaling or in that space. Same sort of thing on the industrial side. On the industrial side, it's really interesting because there's two parts of that, that I see, that are really accelerating because of growth. Specifically on, there's a great deal of innovation on the construction side of the business. Which is a really exciting and fascinating to see, you know, what robotics can do, what so and so, I've seen some stuff on 3D printing, and extraordinary. Then I think just on near the industrial side it's interesting because it's a little quieter, they don't broadcast as much because, you know, the companies at the top of the food chain are so massive and so large but some of the things that like, Prologis is doing within their warehouses in terms of data now it should see, is just, and robotics is mind boggling. Maintenance is another big thing that's there's just tremendous advances in maintenance and energy efficiency, and things like that also in the office side. I mean, on retail, I think retail's a, you know, you mentioned ICSC, we were just at an innovation lounge at their big Las Vegas show. I mean, retail's interesting because I find that like, you know, they were a little late in seeing the threat and now they're really making up for it in a very exciting way and there's just profound, exciting technologies that are coming to retail, everything from sort of, the Amazon Go to, you know, to motion detectors,
Michael Beckerman - sensors, just amazing, but again, I think you could just look at Amazon Go and see that's the future of what retail looks like, for better or worse. On the multi-family side, it's also one that's really exciting, whether it's like, building access, whether it's amenities, and again, communications. Much innovation happening on a multi-family side. What you see now is that the landlords, and the owners, and the managers, are all recognizing that technology can be a way for them to differentiate themselves, get a competitive advantage in the marketplace. It's sort of like, you know, used to be like, who had wifi and who didn't. Who's got just the most extraordinary technology in the unit, in the home, and outside. It used to about like, who's got the cool? And now it's like, who's got the most state of the art, you know mail, locker systems rather--
Adam Hooper - Right, who's got the most room for all my Amazon deliveries?
Michael Beckerman - Yeah, exactly. There's so much happening, it's a lot. Again, it's wonderful, it's wonderful. We don't dabble as much as a hotel side but, you know, I think the major food groups: office, industrial, multi-family, retail. There's innovation happening in every food group and at our conferences, we really do try with have everyone represented.
Adam Hooper - What are some things out there that are maybe super early or not on the radar of the most that you've been tracking, or what aren't we talking about that we should be watching out for?
Michael Beckerman - Wow, that's a great one. One thing that I really notice... I don't know, again, what the application is specifically to your audience but that because of all this technology that's being invested, it's really become now more of a global community real estate and so what we're doing here in the US, is also taking place in the UK. It's also taking place in India, it's taking place throughout Europe. There is this sort of global community that's forming that it's very exciting. From an investment point of view, from a startup point of view, we're getting a lot of foreign investment into the US, in terms of VC's and what have you that are interested in the space. I think the other thing that I think about is that there's clearly an arms race in the sense that the firms that are able to are investing substantial dollars into the space. That is going to give them a clear leg up. So if you're a middle-market firm, you're getting squeezed right now because, you know, this is proving out, day to day, that middle markets and brokerage firms are struggling in some cases because the channel house, the CPRE's, you know, the Newmarks, the Colliars, I mean, they're investing tremendously in tech. At both they're creating, like, look at Colliars and their collaboration with Techstars, they're one of the world's great accelerators, you should have on the show. They're incubating technology that's going to be proprietary to theirs, JLL Spark, same thing. I equate it to fintech's...
Michael Beckerman - It looked like Goldman's doing or some of the other, they're getting competitive advantages based on the technology investments that they make. Just because they're throwing a lot of money at it doesn't mean that they're going to win, but they're bringing in people from outside the industry, Silicon Valley, and tech, to being really leading. You're starting to see CTO's could gain, and CIO's getting increasingly importance on brokerage, and development, and innovation people. That's one of the things I'm really, really, really paying attention to, and then on the, sort of on the investment side, if you're a small investor... When I say small, not dollars, just you're a regional and you're buying in your particular community, and you're not like, a global investor on a couple of markets, you've got like, you know, again, and I come back to Rilke, you don't like opportunities now to be more competitive than ever before in your market, where you can have a leg up on your competitors. It used to be like, you know, you got a call from that broker, or you got a call from somebody because you're in a relationship with them, and you have a strategic advantage because you've got some inside information in a good way, not in a bad way obviously. Now, you could use RealCrowd to communicate and source, you could use so many other tools that are out there to gain a competitive advantage.
Michael Beckerman - I'm starting to see more and more individual investors come to our conferences looking for tools and applications that could give them a competitive advantage. As you guys can attest to, they're becoming, investors are becoming much, much, much, much more sophisticated in the tools that they're using. That's really the great surprise for me is that I'm walking around San Francisco and I'm seeing a couple dozen local investors and multi-family, or office and industrial, talking to startups to use their products in their marketplace, and I think that is extraordinary because oftentimes we get lost in the tree tops but we're talking in the beginning of the podcast, it's really about what's happening locally and individually within each office. That 10 person, 20 person, five person, two person investor or company in real estate can now compete with the 100-person operation because of tools like RealCrowd and others. That to me is thrilling, and that's what technology at it's best can do.
Adam Hooper - There you go. That's some good stuff. There you go, absolutely. Get optimized, get optimized. That is a good, that's a good mic drop, Moe. What's next for you and CREtech, and maybe, yeah, we'll put again the link in the show notes so that all our listeners out there can attend some of these conferences, right? I think it would be, from an educational standpoint and what we're trying with, you know, helping our listeners understand this asset class better, would highly recommend they check it out and attend, and see what's going on in the space.
Michael Beckerman - How about this, how about my team's going to listen to this and get crazy, how about any listeners to the RealCrowd Podcast, we can give a discount to an upcoming event, so we'll work on that together. I love you guys, you're so supportive of the ecosystem, you've been involved in CREtech from day one, showed great leadership, amazing content. We want to encourage your community at RealCrowd to come out and come to a conference. Next for us is really just, continue to scale the events, continue to source, you know, great ideas and themes or what have you. We're looking at our fall lineup. We'll be in LA, coming to Austin in October, we're coming to maybe a couple other places, I know Chicago's on the docket. We'll have another small meetup in New York, and then our big meetup at the end of the year, in December, in New York, which is our largest event. Continue to scale the event. We're producing more video on our websites so please sign up for the website's free, at CREtech.com. For me personally, I'm excited to head over to London in a few weeks to check out the CREtech, or as I like to say, pop-tech world over there. Find out what's happening over there, and bring some ideas back here. I'm just excited everyday, I'm excited about tomorrow. I'm excited about everyday in this space is again, as the infinite learner, I'm just trying to learn and educate myself as to what the smartest folks in this world are doin'
Michael Beckerman - like you guys at RealCrowd and try and bring it to the rest of the my community.
Adam Hooper - Perfect.
Michael Beckerman - Takinh it day to day, so thanks again, guys. I really enjoyed this and big fan of RealCrowd, and everything you're doing, and it's been an honor, and a pleasure to be on the podcast.
Adam Hooper - Well, likewise, we appreciate your time coming on today. If there's anything else you want to add or anything you want to ask us?
Michael Beckerman - You know, I want, well, yeah, how about what's next for RealCrowd, how about that? Give me a scoop on something and we can put it on the website.
Adam Hooper - I will say, keep your eyes out for, and so, a big thing for us has always been, and we've talked about a lot on this podcast, is helping people understand this asset class on a risk-adjusted basis. We've given people tremendous access to this asset class, we've made it, you know, available, $4.5 billion worth of real estate through the platform now.
Michael Beckerman - Wow.
Adam Hooper - A lot of work still needs to be done on giving people the tools to look at things on a risk-adjusted basis. An individual investor doesn't have the underwriting arm that a global investor has. They don't have those risk-modeling capabilities and so you'll see something from us on that pretty soon.
Michael Beckerman - Well, great, can't wait.
Adam Hooper - And then also blockchain. We could talk for weeks on that. So many interesting applications of the fundamental concept of block chain that could have very far reaching impacts for our space and the financial industry in general. Where the biggest kind of hand-wavy, ethereal conversations is, how does this concept of a distributed ledger, what does that mean for the whole notion of ownership. Can a blockchain own a thing? And then my token is a license to that, that bundle of rights that come with ownership, right? Can that challenge this whole notion of just the typical ownership structures? What does that mean from a regulatory standpoint? From a tax standpoint? Absolutely fascinating, fascinating conversation. There's hard to summarize but we're very aggressively looking at that space and I'd say also keep your eyes peeled for, depending on when this podcast launches, you'll probably hear from us on that front as well.
Michael Beckerman - Well, keep us posted because all those themes, those topics, are fascinating to me-- And our community. You guys are so far out there in terms of innovation so any time you've got something that you're going to market to announce, let us know and we want to support it as much as we can--
Adam Hooper - Perfect.
Michael Beckerman - Thanks for the opportunity and continued success to you guys at RealCrowd.
Adam Hooper - Likewise. Again, we appreciate your time comin' on today. Listeners, I hope you enjoyed the episode today. As always, if you have any question for us, send us an email to podcast@RealCrowd.com. With that, we'll catch you in the next one.
Tyler Stewart - Hey, listeners, if you've enjoyed this episode, be sure to enroll in our free six-week course on the Fundamentals of Commercial Real Estate Investing. Head to RealCrowdUniversity.com to enroll for free today. In RealCrowd University, real estate experts will teach you the important fundamentals like the Start With Risk approach, how to evaluate real estate sponsors, what to look for in the legal documents, and much more. Head to RealCrowdUniversity.com to enroll for free today. Hope to see you there.
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