18. October 2018
Lukáš Balík: We knock on the door of the biggest players
From the financial point of view, the startup world is black and white. Either you get an investment and stay in the game, or you don’t get it and you are out. The global real estate market, which has more money than ever, is dog eat dog. Venture capital funds are starting to invest massively in real estate technology and compete for those they will give a chance to succeed. The Czech startup Spaceflow, which digitizes life in buildings, is now looking for a new investment. Spaceflow CEO Lukáš Balík told us how getting an investment in so-called proptech (property technology) works.
Spaceflow is a mobile application that enables people to see what is happening inside the building they live or work in. People can connect more easily with their neighbors, colleagues, friends and strangers and make use of services that are provided in the building. The application gives an overview of events that are taking place, of people who are inside the building and of things that are happening, like a restaurant giving a special offer or an elevator not working. Community managers ensure the best experience possible for occupants – through attractive content, events and personal communication.
Two years ago, you were one of the first startups to deal with real estate. Today, proptech startups are mushrooming. What is it like to be taking part in the global competition from Prague?
We compete heavily with proptech companies in the US and UK. This is hard because citizens of these countries use our app to better enjoy life in buildings. They are always accustomed to being the leaders in most fields, and it is a shock for them when someone from outside comes to take the reins. We are one of the few Czech companies that does not only produce software but sells emotions. Americans are the best at working with emotions in business and it’s them we’re up against in this fight.
Would you say you're playing in the big leagues?
Yes. The real estate market is very competitive and there’s a lot of money in it. Companies that are younger than us and have a less developed application get millions of dollars’ funding on the US market. We don’t want to miss the boat, so by the end of the year, we plan to start an intensive search for an investor. Either we can remain a regional player or move on, and the investment will have the final word on which it will be.
I have heard that investors come to you and you refuse them. Is it true?
We do not reject investors. That would be crazy. We recently received an investment from UP21 and did not want to negotiate any further round of investments. Still, I try to maintain ongoing contact with investors; for example, when I had a call with one in the spring, I explained what we’re doing, what phase we’re in, and what we’re looking towards. But to begin a serious discussion, I focus on a detailed investment strategy, investors deck, and a financial model now.
Which type of investor will you look for going forward?
Primarily we are looking for foreign investors who are engaged in real estate. A lot of funds that have a branch focused on real estate technology have begun to contact us. These are mainly US, UK and German funds, but also venture capital funds that are targeting growing companies. As for the amount, we want to target a several million dollar (post-seed, Series A investment, note) investment.
Do you already know how to get these investors?
I would like to start actively contacting funds via CrunchBase. So far I have not done this, because I usually meet people at an event or they come to us themselves. Occasionally someone connects us with someone else from the market or recommends us to another fund, but now we want to be more active in that.
Do you have any advice to share with anyone looking for an investment?
I usually go to events that focus on our field rather than general startup events like Wolves Summit. I'm trying to educate myself in the area of real estate and at every conference we go to, I talk in a panel discussion or organize a workshop. At Spaceflow, we know what’s trending and we always have something to say about what’s currently happening in our field. We do not go to events as visitors but as speakers. Not only do we have a better chance to meet someone interesting, but it also creates a buzz. I think it’s good to get more involved.
Lukáš Balík is the CEO and founder of Spaceflow, a company that transforms physical buildings into a human experience. Spaceflow provides local community management and a global community platform that enables connection, sharing and use of exclusive services. As a speaker, Lukáš has participated in the largest PropTech conferences in the world, such as DisruptCRE in San Francisco, MIPIM PropTech in Paris and Future PropTech in London.