Real estate tech to get $1.4B in 2015, but is “bloodbath” ahead?

Money is pouring in for the makers of disruptive real estate technology, but many favored companies may not be around long enough to collect it.

Investors will lay down an impressive $1.4 billion in investment on tech startups in the sector this year, up from $1 billion last year and $438 million in 2013, according to data from CB Insights.

The numbers, along with dire warnings from top players, were presented at a conference last week hosted by Rubicon Venture Capital. Panelists there stressed both the opportunities and the many difficulties for firms, many of whom are based in New York.“It’s pretty easy to get a meeting if you are disrupting something in real estate,” said Richard Sarkis, CEO of Reonomy, at a panel.

Despite the existence of companies like short term rental service Airbnb, co-working startup WeWork, and crowdfunding sites like Fundrise, the real estate industry has, in general, been comparatively slow to adopt new technologies. Many previous aspirants have crashed and burned, and the same is likely to happen again, when the market turns down, panelists said, according to the Wall Street Journal.

“It’s going to be a bloodbath,” said Floored CEO Dave Eisenberg, who said it’s not always easy to get customers to appreciate the benefits of new technology.

Floored introduced a new product last month, Protofit, that allows landlords to draw their own commercial test fits, an alternative relying on architecture firms. WeWork, valued at $10 billion, recently resolved a four-month dispute with the 32BJ SEIU service workers union, who accused the company of underpaying its workers.  Compass recently caused a flap in the Hamptons brokerage world when they poached Ed Reale, former of sales manager at Brown Harris Stevens, to lead Compass’s Hamptons office. [WSJ] – Ariel Stulberg