Bloxspring has worked with over 60 real estate technology and innovation firms, across 16 countries. Recently, we analysed a random sample of 25 of these to see how they’d performed over the last three years.
Here’s what we found:
5 (20%) had excelled, either becoming or maintaining their position as the market leader
5 (20%) had grown steadily, expanding their customer base or entering new markets
5 (20%) stagnated - neither growing nor regressing
6 (24%) struggled to survive - losing clients, market share, and cutting staff
4 (16%) shut down entirely
Now, clearly this is not an exact science, but what really stands out to us is the even spread across all categories. Whilst it’s more than possible to build strong, market-leading organisations that fulfil their potential, it’s equally possible to flounder and fail.
But what causes one company to succeed, where another fails? What causes one to push on where another stagnates? Here are the patterns we’ve spotted over the past five years.
Use of Funding
Funding is never an end in itself. It’s just the start.
We’ve seen way too many companies land big funding rounds, only to act like the job is done. It’s not wrong to celebrate capital investment, but for some organisations, it’s like the party never ends. They squander money on unnecessary office spaces, events and travel. They don’t put the wheels in motion for the next raise early enough. They don’t interrogate every $ spent.
Here’s what the successful organisations do with capital injection:
They address root problems: they recognise that closing a funding round doesn’t mean they’ve made it. They are humble enough to look at shortcomings across their team - their product, their marketing, their operations - and then confront them. They don’t spend money on vanity projects or nice-to-have initiatives. Ultimately, they recognise that funding is a launchpad, not a reward
They hire smarter people: the founders put their egos aside and hire people that have skills they don’t have. They accept that whilst they were undoubtedly the right people to take the company from 0 → 1, they may not be the right people to take the company from 1 → 10. They bring others in that can do just that
They improve product fundamentals: they continue to invest in their core product, ensuring that they troubleshoot existing gremlins and issues. They perfect what they already have before thinking about what’s next. Then, and only then, do they move on to exploring new features and capabilities
They don’t lose financial discipline: they maintain (even improve) their financial rigour. Every decision is scrutinised. Every investment is accompanied by a clear business case. Purse strings aren’t loosened unnecessarily. They see themselves as custodians of capital, rather than the recipients of it