Proptech’s Job Picture? Blurry, But Big.
Some companies are making large cuts, while others are still growing and seeking talent — especially on the technology side
Like other industries attempting to navigate the crosscurrents of a global economy beset by rising inflation and interest rates, proptech companies are trying to steer their way to a business safe harbor. A major factor in securing such a berth is deciding whether to hire or fire in this uncertain time.
While the proptech industry continues to grow as an important component of real estate, it is still nascent enough to make it difficult to come up with accurate headcount figures. Making broad statements about the number of people employed in proptech still depends on mostly anecdotal data.
An overview of the proptech employment picture can be found in the numbers from the recent Center for Real Estate Technology & Innovation (CRETI) Jobs Index, a newly created survey that sources its estimates from LinkedIn and Glassdoor.
As of August 2022, there were 7,509 new proptech jobs this year, of which 3,381 are “hybrid/remote” workers. August saw 647 new hires, a 26.1 percent increase over the 513 jobs filled in July, which exceeded expectations but is far below Q1 2022 when employment surged, according to the CRETI index. The August hires included 290 hybrid/remote workers, a 22.9 percent increase over July’s 236.
“There is a calm center and lots of conflicting factors swirling around the intersection of proptech, conventional real estate, and the macro labor market,” said Ashkán Zandieh, founder and co-chair of CRETI. “Effectively, what we’re seeing is that despite rising interest rates, macroeconomic challenges and supply chain issues that continue to plague businesses around the world, the jobs market is resilient and the proptech market is robust.
“I think it’s reasonable to expect that we will not keep pace if there is another shock to the system,” Zandieh added. “I think that we may well have seen the low for unemployment during this year.”
In fact, a number of prominent proptech companies have suffered large job cuts in 2022. Faced with continued interest rate hikes that are hammering the mortgage market, proptech companies focused on residential real estate have dropped the ax on employees particularly swiftly.
Some established proptech firms in this category that have announced or been reported to have made employee cuts since November 2021 include Better.com, which dropped at least 250 in a recent fourth round of cuts; Compass, which cut 450, or roughly 10 percent of its staff; Flyhomes, which cut 200, or 20 percent of its workforce; and Homie, which laid off 90 to 105, or about a third of its employees. Elsewhere, Homelight dropped about 20 percent of its workers; Homeward announced a 15 percent reduction to its 600-member workforce; Juniper Square cut 14 percent of its 469 employees; Latch cut 115, or 37 percent; Loft dropped 380, or 12 percent; Redfin 470, or 8 percent; Rhino cut 57, or 20 percent; Sonder cut 28 percent of corporate and front-line staff; Tomo cut 44, or about a third; and Zillow in November cut 2,000 employees, or about 25 percent of its staff.
This being real estate, though, even companies that have made cuts, such as Juniper Square, see a positive outlook in the near future.
Asked to comment on its decision to reduce headcount, Juniper Square, which bills itself as a “partnership enablement” firm for investors, said in a statement that it “is continuing to hire to support rapid client growth, especially in our service and support organizations. We recently had a reorganization that resulted in a reduction in the size of our sales force and ancillary functions. Some of those team members were offered other jobs in the company. Overall, we expect our headcount to have a net increase in 2022.”
The company also said that as of September 2022, its year-over-year employee base had increased by more than 25 percent, and it expects headcount to grow more than 20 percent between mid-September and the end of the year.
Other proptech firms chose to look on the bright side as well.
“Over the past year alone, our team has nearly doubled to 100 professionals across our three offices in San Francisco, New York City and Toronto,” said Mike Sroka, CEO and co-founder of Dealpath,” an 8-year-old firm that provides management software for real estate investors. “We experienced much of this growth through a global pandemic, social unrest and market volatility.”
Sroka expects continued growth for his company.
“We are recruiting for over 20 positions across the company with numerous roles in product development, go-to-market and business operations,” Sroka said. “These roles are across levels, from executive to earlier career, and across our offices. We anticipate another significant year of growth in front of us.”
Dealpath’s compensation packages align with the top quartile salary for growth-stage companies, and includes all employees receiving some equity in the business, Sroka added, citing compensation data sourced from Carta and Option Impact.
Early-stage venture capital firm MetaProp is also bullish, citing its hirings last week of Satoshi Murakami as regional director for Asia and the Pacific (APAC), and Dana Wildeboer as vice president of marketing.
Murakami will act as the VC’s representative on the ground in APAC, a region in which MetaProp views the growth of early-stage proptech companies increasing daily, according to the company. In a further attempt to establish itself in the market, MetaProp plans an APAC Regional Summit for founders and investors to connect in Singapore, Seoul and Tokyo.
“We have been able to be proactive in hiring as opposed to reactive, acquiring talent based on our future goals and expectations versus immediate needs,” said Katie Klein, North America country director for WiredScore. “Over the course of the past 12 months, we have nearly doubled our headcount to 150 employees across our 27 markets.”
The company is looking to fill seven positions in North America, including business development, marketing, IT, people operations, product and R&D, said Klein.
A mixed bag of hiring and firing can be found outside the U.S. as well as within, said Xan Winterton, managing director for North America with LMRE, a London-based global proptech and real estate recruitment and consultancy research firm.
“It appears that the majority of the people being let go are probably more on the commercial side of the business rather than on the engineering side,” said Winterton, who is based in Manhattan. “The demand for engineering and tech talent still remains high and competitive even outside proptech.”
Philip Russo can be reached at firstname.lastname@example.org.