The process used by millions of real estate agents and thousands of real estate portals worldwide to reach buyers and sellers through digital channels is highly fragmented. And it’s clear that proptech, unlike other industries, has lagged behind in using social media to sell.
South African startup Flow wants to change the way brokers, developers and brokers interact with their end customers. With its APIs, Flow connects to the websites of real estate agents and developers and automates advertising for them on social media channels such as Instagram and Facebook. The proptech marketing platform announces it has raised $4.5 million in pre-Series A funding.
The proptech plans to use the funding to incorporate other social media platforms such as TikTok and LinkedIn and other advertising channels such as out-of-home billboards. The investment will see co-founders and co-CEOs Gil Sperling and Daniel Levy drive the company’s B2B growth strategy and integrate Flow’s social media-driven real estate marketing platform into existing international real estate portals and CRM platforms.
Sperling and Levy founded Flow in 2017 as an app that rewards tenants for early rent payments. Before Flow, however, both founders built an adtech and performance marketing company, Popimedia, which was the largest buyer of Facebook media inventory in Africa for some of the world’s biggest brands. While she sold the business to global communications group Publicis in 2016, it was some of the knowledge they gained while running Popimedia that they used four years later to transform Flow into today’s business model.
“With our first adtech company, we never had to deal with real estate or real estate because we could never really serve them in this country [South Africa]. And the biggest problem was that while real estate is the largest asset class in the world and a very valuable industry, it’s the least innovated because it’s just very fragmented,” Sperling told australiabusinessblog.com over the phone.
“When buying and selling houses, if you take South Africa for example, 40,000 real estate agents are putting 300,000 advertisements on the market at any one time. Every agent is essentially a small business because they’re commissioners and they can’t possibly afford to each have a marketing, data science and design department like big companies can and that’s one of the reasons we couldn’t run advertising or performance marketing for many of them.
With Flow, the founders want to connect brokers and project developers that they could not reach with their former startup, through digital channels with customers. The proptech startup automates brokerage marketing for developers and works hand-in-hand with real estate websites like Ownership24 and Private property to retrieve lists and automatically create ads on Facebook, Instagram and other digital channels.
According to Flow, the proptech marketing platform improves agent revenue and experiences for property buyers and sellers. On the other hand, Levy points out that the startup makes money when these agents use their SaaS platform and through a percentage discount on their marketing spend. He added that sales have grown 20% month-on-month over the past year.
“Our route to market was mostly door-to-door from franchisor to franchisee to various offices within that group. And over the past few months, we’ve identified the enterprise channel, as we call it, which is more associated with tethering our technology to portals,” said the co-CEO. “So our next phase of traction and growth will come from those relationships, which are important in our world. And that’s why we just went through this capital raise to essentially experiment with that.
Flow currently has over 300 clients using its platform – a client is a brokerage firm or developer where each office has about 15 to 20 smaller agents. So more broadly, Flow is used by nearly 6,000 agents in South Africa, Namibia, Botswana, Mauritius and Australia. It is in talks with partners, mainly real estate portals and CRM platforms, to expand into Europe (France, Germany, Belgium and the UK), where it will face stiffer competition – which the co-founders hope Flow will beat with its technology and attention to design — but a broader market base.
Futuregrowth Asset Management led Flow’s pre-Series A round with $2 million. Endeavor Harvest Fund and serial entrepreneur Steven Heilbron participated, while existing investors Kalon Venture Partners, Vunani Fintech Fund and Buffet Investments also doubled.
“We have been closely following Flow’s progress in South Africa and Australia and its integration into the B2B side of the global real estate industry as the next natural step in the company’s evolution,” said Amrish Narrandes, Head of Private Equity and Venture Capital at Futuregrowth Asset Management. on the investment. “We share Daniel and Gil’s vision to take the real estate industry into the 21st century and know they have the expertise and experience to make it happen. bringing much-needed change to a vital global industry.”