A new European venture capital (VC) fund dubbed A/O PropTech launched a month ago promising €250 million euro in "permanent capital" investment for disruptive proptech companies.
The fund is a "first of" investing approach which is structured more like a corporate shareholder arrangement, rather than your typical VC fund. According to A/O PropTech, this more permanent approach makes for a more patient and flexible investor/startup interaction.
So far, A/O PropTech has invested $32 million in property management platform Plentific, as well as 9 other investments in startups across Europe, the U.S., and in Israel. The fund's CEO Gregory Dewerpe had this to say about A/O PropTech's approach to the media at the time of the fund's launch:
“Investing with permanent capital allows A/O PropTech to stay agile and flexible, whilst removing the structural timing constraints found in traditional fund structures which create potential misalignments with entrepreneurs over the investment horizon."
Dewerpe went on to say the fund's focal point will mostly be investments in Europe, but that that certain U.S. and Israeli investments are also attractive. The firm also boasts of multidisciplinary prowess for its professionals who have experience in realms from real estate to finance, big data, engineering, and other disciplines.
Interestingly, A/O PropTech seems to be hitting the ground running where investing in new trends is concerned. Case in point, Dewerpe was at Calcalist's WeTech Berlin 2020 conference back in March. He talked with CTalk during the conference about how the real estate industry is responsible for 30% of global carbon emissions, and how his firm aims to boost green and sustainable innovation.
Another facet of this new fund that differentiates it is what Dewerpe calls a "ready-made sandbox" for startup testing made possible by A/O PropTech's pool of residential, commercial, and hospitality assets. By testing emerging tech in real-time, A/O PropTech startups can fast track to commercial and operational scale faster than most competitors. The fund's CEO used the case of hotel data intelligence startup Fornova, and investment platform Bricklane as examples.
With offices in London and in Switzerland, A/O PropTech invests in firms from Series A to later growth stages in breakout companies. The fund's investors are some of the largest institutional real estate companies in Europe controlling a combined strategic pool of residential, commercial and hospitality assets in excess of €32 billion euro.
Until recently, pure-play European proptech VCs have trailed their U.S. counterparts in terms of the scale and size of funding. The launch of A/O PropTech signals a new synergy toward closing the gap in the worldwide proptech venture landscape.