US professional services company JLL today launched a new global venture fund. The $100 million (£75 million) JLL Spark Global Venture Fund will invest in companies pioneering the use of technology in the real estate sector.
The launch comes amid what another new fund, Dot, describes as the “containerisation” of real estate, with new technologies and techniques allowing full acquisitions to be bundled into unique structures at the click of a button
The JLL Spark Global Venture Fund will focus on companies “leveraging technology to improve everything from real estate development and management to leasing and investing, while enhancing the experience of those who occupy it.”
JLL Spark’s co-CEO Mihir Shah said in a release: “Having been entrepreneurs ourselves, we know how hard it is to bring a new product to market, especially in an industry that has been slow to adopt new technology. That’s why our goal is to partner with entrepreneurs, and help them tap into the resources of JLL’s business lines so they can succeed in rapidly growing their companies while we also create value for JLL’s clients.”
Industry Ripe for Disruption
In the UK, the rapid rise of online-only estate agents Purple Bricks has highlighted the extent to which the industry is ripe for disaggregation.
Purple Bricks shuns traditional bricks-and-mortar shop fronts for an online portal and a flat fee rather than a commission, payable – unlike traditional agents – irrespective of whether the property sells or not.
Others are keen to bring to market unique offerings.
“Containerisation of Real Estate”
Dot Fund is one of the latest. The UK-based company, founded by New Zealand-born entrepreneur Gray Stern, allows registered users (who have a 30 percent deposit to hand) to buy property with the click of a button.
On suggesting a property acquisition the fund crunches the data to assess yield, demand and value and arrive at an estimated cash flow. Buyers can then pay the deposit and hit a button.
This moves each property to a “Dot Container” with the tax and ownership structure of a UK Limited Company but “without any of the typical administration or compliance headaches.”
(Tax and compliance work is undertaken independently by EY as part of the package).
Spark Fund Focus
The JLL Spark fund meanwhile will focus on seed and Series A investments, as well as select later stage rounds. Typical investment size will range from a few hundred thousand to several million dollars.
The fund is also interested in companies that are inventing new technology-enabled business models in traditional JLL service areas or those that will help expand its services to new client segments, the fund said.