Startup Balcony Secures $12.7M Seed Round

Balcony, a proptech startup looking to develop the digital infrastructure for municipal and state real estate data, announced Tuesday that it raised a $12.7 million seed round.

Blockchain Ventures led the round, which along with funding from Ava Labs, Blizzard Fund and angel investors, brings the company’s total raise to $14 million.

The financing will be used to accelerate Balcony’s development of “digital rails” for America’s real estate economy, with the latest funding used to scale the company’s engineering and go-to-market teams. It will also be used to expand its platform across county and state governments nationwide, said Gregg Lester, co-CEO and president at Balcony.

The Hoboken, N.J.-based company is developing an electronic infrastructure designed to automate and secure real estate transactions, replacing traditional legacy paper-based models that can be prone to fraud. Title insurers, mortgage lenders and capital markets pros will be able to use the newly created systems to work faster and with less risk.

“Real estate is so based on public sector data and counties, and counties are where deeds are recorded, tax assessment is created, and mortgages are recorded,” said Lester. “And, so far, that’s where real estate is actually transacted. For that reason, the public sector, specifically counties and states, are where we’ve started. In order to have the foundation of real estate data for every property in the country, and then globally, you need to start by having all the information and relationships with all the counties and states. That’s why we’re super focused right now on county and state relationships, but are also starting to evolve in the financial capital market sector.”

Balcony’s platform integrates with public-sector systems to organize historical records into structured and connected data layers to provide a comprehensive view of property history and ownership. Its Keystone property infrastructure platform uses artificial intelligence to index and organize property data, aggregating land records sourced directly from government agencies into a single, searchable system. Keystone is currently helping government agencies in the U.S. manage and secure more than $400 billion in property value on its platform.

“We’re giving the ability to search a property address and see a history of all the deeds, mortgages, liens, tax assessment data, zoning data, tax collection data, GIS information and so forth,” said Lester. “Right now, this is being used by county officials and staff members themselves as part of their workflows to be able to answer questions based on property information that people call them about.

“In addition, it’s used by actual real estate developers and real estate owners within those counties that need to access this information. Title company researchers are already accessing this data, but now with our platform they have the ability to access it in a single way by searching property addresses and finding the information, versus having to manually go to all these different systems and whatnot.”

Balcony recently signed a five-year contract with the Bergen County Clerk’s Office in New Jersey to digitize and bring 370,000 property parcels onto its platform, representing approximately $240 billion in real estate value.

One of Balcony’s goals is to enhance property security and in turn strengthen national security by monitoring land purchases by foreign “bad actors,” such as China, said Lester.

“So the threat is that we have potential bad actors starting to purchase critical infrastructure in our country,” he said. “There are reports of, for example, people tied to the Chinese Communist Party, buying farmland throughout our country, which some people see as a potential issue. There have been states like Texas, Wyoming and others that have promoted and approved bills that specify people tied to foreign enemy countries are no longer allowed to purchase land within those states. So this trend is happening right now.

“To give you an example, we had an informal pilot with the U.S. Department of Treasury where we found that there were transactions tied to a Bitcoin mine next to a military base in Wyoming. After doing our analysis and running this through our platform, we found out that the owners behind the Bitcoin mine were actually tied to the Chinese Communist Party. That was kind of the beginning of a eureka moment. What other information can we learn about by simply seeing who owns what in multiple areas and checking for patterns across all those different transactions?”

Ken Seiff, managing partner at Blockchange Ventures, cited the national security angle as a reason for investing in Balcony.

“The drive to build these digital rails is imperative because our fragmented, century-old system is vulnerable,” Seiff said in a statement.” Balcony’s unique ability to create a verifiable and connected view of land records is the gamechanger, empowering governments to protect against fraud and monitor foreign ownership, which in turn builds the foundation of trust required to finally modernize the rails for the entire real estate economy.”

Philip Russo can be reached at prusso@commercialobserver.com.