Real estate gained a new tech accelerator this week, MetaProp NYC, which plans to invest up to $5 million in dozens of real estate-related startups over the next five years.
The group is accepting applications now for its first cohort, which will kick off a 16-week term with eight startups in New York City in late summer.
The New York City-based group launches with five corporate partners, including real estate tech giant Zillow Group and New York City-based brokerage Warburg Realty, which will provide operational support to startups accepted into the accelerator.
Warburg Realty, which has approximately 130 agents and four offices, will house MetaProp NYC’s headquarters and accelerator participants at its downtown Manhattan office. Zillow Group is supplying three mentors to the accelerator and will support a West Coast “demo day” for its participants.
A tech accelerator is a privately funded effort to give a financial boost, as well as expertise, to startup companies. In exchange, the backers usually get an equity stake in the company and garner tech expertise for their core business.
A growing number of real estate tech incubators should contribute to innovation and new business models. Brokers might consider starting their own local incubators to offset technology costs and be part of the innovation swirl.
Madison, Wisconsin-based Century 21 Affiliated, which has approximately 1,500 agents and claims to be the largest Century 21 affiliate in the world, is behind the year-old Chicago-based real estate tech accelerator Elmspring. The group hosted its first demo day outside the Midwest at Zillow Group’s San Francisco offices in June.
The eight firms accepted into MetaProp NYC get $25,000 in cash, access to a vast mentor network, office space for 16 weeks and, in exchange, give up a 6 percent equity stake in their firms. In addition, two of the member firms will receive $250,000 in funding, and all eight will have access to a $175,000 pool of cash from another investment fund.
The program, which for now will be held once a year, will culminate in a “demo day” to partners, investors, venture capital firms and media.
MetaProp NYC has a broader focus than real estate’s two other tech accelerators, National Association of Realtors’ REach and Elmspring.
It plans to accept firms from a broad swath of real estate including multifamily, development, commercial, hospitality, industrial and residential, according to MetaProp NYC’s co-founder and managing director, Aaron Block.
Block, a serial entrepreneur with a background in commercial real estate, told Inman he came up with the idea for MetaProp NYC because he saw real estate startups needed help to grow faster.
Zillow Group, Warburg Realty and MetaProp NYC’s three other corporate founding partners will supply between $25,000 and $1.5 million for each accelerator cohort, but they will not be given equity in the firms, Block said.
Instead, they will receive a first look at new real estate technology, an opportunity to shape new products and an opportunity to brand themselves as supporters of innovation, he said.
“While technology has clearly been a key driver of this evolution (in real estate transparency and efficiency) on the consumer side, we have seen few technological innovations to support the broker in their advisory role and to help deepen their relationships with their customers,” said Clelia Peters, Warburg Realty’s director of strategy and innovation, told Inman.
Peters is also a MetaProp NYC co-founder — but in a personal capacity, not as a Warburg Realty rep. Like Block, Peters saw a “big opportunity” to boost innovation in real estate by providing startups access to a powerful network with an accelerator.
Editor’s note: Zillow Group currently provides three mentors to MetaProp NYC, not four as a previous version of this story stated.