Here are the 5 most well-funded proptech startups in Asia

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(Additional reporting by Nathaniel Fetalvero)

Real estate might be the largest asset class in the world, but as an industry, it’s also known to be traditional and slow-moving. But thanks to the rise of proptech startups, market gaps and inefficiencies are being solved.

Investors have taken notice of this growing market. According to proprietary data from global real estate services firm Jones Lang Lasalle (JLL) and Tech in Asia‘s research, startups in Asia Pacific have received around 60 percent of over US$7.8 billion invested in proptech worldwide since 2013 – that’s almost US$4.8 billion in funding.

The evolution of proptech

Proptech 1.0 began in the early days of the internet, when it enabled a batch of startups, such as Singapore’s PropertyGuru, to bring real estate data online. This made crucial information readily and directly available to users, so they didn’t have to rely solely on agents.

Proptech 2.0 ushered in startups that offered more specialized services like virtual reality or data analytics to automate more of the time-intensive work that buyers, sellers, and agents had to contend with.

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With Proptech 3.0 upon us now, blockchain, augmented reality, and other new technologies are coming into play to further transform the real estate industry.

However, many of the proptech startups that have managed to raise a good amount of funding to date remain aggregators or marketplaces, so they belong largely to the first wave.

According to Alex Ng, managing director of seed capital firm and startup incubator Spaze Venture, the imbalance in funding is due to the fragmentation occurring in the space.

“When [startups] try to disrupt the process flow or do crowdfunding or use blockchain, it indirectly creates many fragmented niche spaces,” says Ng. “From an investor’s point of view, if I have a startup that only captures part of [the market], then that brings down the potential returns of that investment.”

The whole situation may soon change, however, as first-generation startups slowly move into Proptech 2.0 and perhaps later, Proptech 3.0.

Here are the top five most well-funded proptech startups in Asia today. Not surprisingly, due to a growing number of tech-savvy real estate consumers, China is leading the charge with its startups taking four out of the five spots on this list.

1. Qfang

Total disclosed funding: US$617 million

Based in Shenzhen and Hong Kong, online property listing platform Qfang was founded in 2000. It was acquired by asphalt manufacturer Hubei Guochuang Hi-tech Material for US$54 million in early 2017.

While it had originally planned to focus on the Hong Kong market and open 200 branches by 2017, Qfang has since shifted its strategy to “developing an online platform to better serve buyers from the mainland,” according to report by South China Morning Post.

2. iProperty Group

Total disclosed funding: US$521 million

Australia’s REA Group snapped up Malaysia’s iProperty Group in 2015 in one of the largest exits in Southeast Asia to date. That year, iProperty had around 4 million monthly users and booked US$17.7 million in revenue in the first three quarters.

In 2016, iProperty started looking into artificial intelligence with the launch of Rebecca, an AI-powered property chat platform available on Facebook Messenger and Telegram.

3. Mofang Gongyu

Total disclosed funding: US$500 million
Funding stage: Series C

Based in Shanghai, apartment rental operator Mofang Gongyu was founded in 2009. By 2016, it raised US$300 million in a series C funding round, making it to the ever-growing list of Chinese unicorns.

At that point, the startup was operating some 150 apartment complexes across 15 Chinese cities, and owned 25,000 apartment units that serviced close to 40,000 tenants, according to DealStreetAsia.

4. Anjuke

Total disclosed funding: US$339 million

Another real estate marketplace based in Shanghai, Anjuke was bought by 58.com – one of the largest classifieds websites in China – in 2015 for US$267 million. According to Michael Jinbo Yao, chairman and CEO of 58.com, the deal made his company the largest secondary and rental real estate platform in the country.

5. FangDD

Total disclosed funding: US$306 million
Funding stage: Series C

Based in Shenzhen, FangDD might seem like yet another property marketplace. What makes it different from other players is its “pay-for-performance” business model. In other words, it doesn’t charge on a per-listing basis, as most similar companies do. Instead, it charges a commission based on the value of the transaction that is shared with the agent who brokered the deal.

FangDD sold 190,000 homes in 2014, with sales revenues of around US$31.8 billion, according to a 2015 report from South China Morning Post.

JLL and Lendlease have launched Propell Asia, an accelerator that aims to provide proptech startups with the unique opportunity to validate their products, test for market fit, and get access to JLL and Lendlease’s assets and networks. Sign up on the website or email info@propellasia.com for more information. Registration ends August 17, 2018.