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EXECUTIVE SUMMARY

• Despite a decline in the number of PropTech M&A deals and total PropTech private investment activity in Q3 2020, the market for investment into and acquisition of PropTech businesses remains highly active with multiple mega M&A deals and public market listings in the quarter
  • Rocket Companies’ IPO, Lemonade’s IPO, Optimal Blue’s $1.8Bn sale to Black Knight, Ellie Mae’s $11Bn sale to ICE and Opendoor’s SPAC merger highlight the mega deals that transformed the market in Q3 2020
  • Nearly $800MM in private growth capital investment in the quarter across 58 deals, down meaningfully q/q, but still multiple high-profile capital raises with companies such as Orchard, Aquicore, Hippo and Blend all raising capital in Q3
• Residential Real Estate (RRE) tech and its associated ecosystem – mortgage tech, P&C insurance tech, title / closing tech, tech-enabled brokerages – continues to be a very active segment of the market as low interest rates and COVID-19 influenced migration drive RRE transaction activity
  • Transaction digitization tools – digital title & escrow (JetClosing raise / Modus sale) and digital mortgage tools (Blend raise / Ellie Mae sale / Optimal Blue sale / Snapdocs raise) – are especially active segments of the market
• Valuation multiples in the market continue to remain strong, especially for tech / software businesses, with the NASDAQ up ~30% YTD – Rise of SPACs (Special Purpose Acquisition Companies) with focus on PropTech
  • Opendoor / Porch / Open Lending / Vivint all announced SPAC mergers YTD with multiple additional PropTech-focused SPACs looking for targets
• Commercial Real Estate (CRE) tech saw multiple investments in “back to work tech” in Q3 to address the impact that COVID will have in the corporate office market
  • Density, a workplace capacity and building utilization tracking tech business raised $51MM in funding and ROOM, a manufacturer of single office booths and meeting pods, raised $13MM
• GCA expects continued strong PropTech market activity in Q4 2020 given the momentum and tailwinds in the sector