The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 43 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 1 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Wallace: Left to their own devices, corporate VCs make terrible decisions
“While they have all this potential left to their own devices, corporates will make terrible decisions.”
Digitally native brands inevitably hit an online customer acquisition cost wall
“But what they all seem to face is this dynamic where they grow to a certain point. And at a certain point, whether it's five million dollars or ten million dollars or twenty million dollars, they hit this asymptote. And at that asymptote, the cost of acquiring…”
The era of the 1,000-store retail brand is permanently over
“The era of the thousand store brand is over, and I just don't think it's coming back.”
Consumer retail brands will not achieve $10 billion software-style exits
“What I don't think you'll see is the ten billion dollar exits that typically you see in true software, both enterprise and consumer software businesses, and like we look for out of our real estate technology fund,”
Legacy retail giants will be replaced by hundreds of niche brands
“I think we're not going to have the gaps and the banana republics and the major brands of the era previously replaced by five to 10 new brands, but instead they'll be replaced by hundreds of brands.”
The top 200 digitally native brands are growing faster than Amazon
“Actually, if you look at kind of the top 200 digitally native brands, they're actually growing faster than Amazon, independently of Amazon, and many of them don't sell their products on Amazon.”
Airport parking will be largely obsolete by 2027 due to AVs
“No one's going to park a car at an airport probably in 10 years, or very few people will.”
Real estate valuations will react to AVs well before mass adoption
“Even though the mass adoption might not happen for a long time now, I think the impact on real estate could happen on a much more accelerated basis.”
VTS holds a virtual monopoly in office leasing management software
“Literally this company has basically a monopoly on this category.”
Wallace: Venture capital is a boring industry that has never been disrupted
“VC is a pretty boring industry. Talk about an industry that's never been disrupted, right?”
Wallace: Silicon Valley echo chamber caused VCs to overlook proptech
“I do think there's an echo chamber that exists in Silicon Valley that has actually perpetuated some of the problems in venture capital in the Bay Area and overlooking huge categories like prop tech.”
Wallace: Corporate investors now account for 45% of all venture capital dollars
“Corporate investors represent 45% of all dollars into venture capital.”
Wallace: Corporate VC will exceed 50% of all venture dollars by 2031
“And I expect that sometime over the next decade, it'll be more than half.”
Wallace: Proptech sector will grow 10x to 20x from current levels
“Prop tech is 10 to 20 X from here.”
Amazon's Google AdWords spending makes customer acquisition prohibitive for upstart brands
“On frankly, Google AdWords to grow very quickly online, but now Amazon is the number one spender on Google AdWords, and frankly, they're making the cost of customer acquisition almost prohibitive for many of these new upstart brands”
Influencer marketing cannot scale brands to hundreds of millions in revenue
“You then run into challenges around scale, which is, that's not really a platform to build a Multi hundred million dollar revenue business.”
Series A and B retail startups carry lower loss risk than software
“I think the loss ratio generally should be lower because you can underwrite a more stable business. So because valuation multiples are lower within e-commerce and retail investing, the ability to massively overvalue a business with very low revenue Who might a…”
Proptech adoption will expand for a decade, creating trillion-dollar markets
“You're not just talking about opportunities in the billions of dollars with enormous total addressable markets. You're talking about opportunities in the trillions of dollars. So I think this is a trend that will go on for probably the next decade, frankly.”
Corporate incumbents determine winners and losers in proptech
“A handful of incumbents, a handful of big corporates really dictate who wins and who loses in real estate tech.”
Wallace: Fifth Wall invested in Hippo before finishing its first fund
“We hadn't even raised our fund. And the soft was like, you need to invest in our business. And I was like, I don't even have a fund yet. I don't know how I'm possibly going to do that. But ultimately we did.”
Wallace: States Title bought an entire business unit from a corporate LP
“Our idea was our corporates would just buy the products of the tech companies we were investing in. We didn't contemplate that our startups would be buying entire businesses from our corporates, which is precisely what Max did.”
Wallace: $64 billion was invested in proptech from 2016 to 2021
“Now, sixty four billion dollars has gone into the category in just the last five years.”
Wallace: Fifth Wall manages $1.4B and counts 4 top US homebuilders as LPs
“We're now with a 1,000,000,004 under management. We have four of the top five home builders as strategic LPs in our fund.”
Retail real estate owners require specialized tenant and customer engagement tech
“What we saw in engaging in fund one was that retail real estate owners had fairly idiosyncratic needs. What they were looking for was both technology for the plants, but they were actually looking to identify technologies that supported their engagement with b…”
Retail is a $6 trillion market that has grown for a decade
“It's a six trillion dollar market. It's been growing for nearly a decade.”
E-commerce represents only 15 percent of total US retail sales
“And today, e-commerce accounts for about 15% of all US retail sales.”
Offline retail expertise for digitally native brands is in short supply
“There's a lot of what I would call, there's a support ecosystem around online merchandising and almost influencer marketing and getting celebrities to endorse their products to sell and distribute digitally, but there's no one that can really provide that doma…”
Future retail expansion will focus on market density over total store count
“So I think just generally the whole nature of how you expand into brick and mortar retail, Is going to change. It's going to both densify, it's going to be fewer stores, but I think within the major markets, you actually might have more stores than you did pre…”
Fifth Wall raised a $125M retail fund from real estate owners
“But I think in the case of our retail fund, where we're now backed by one hundred and twenty five million dollars of some of the largest retail real estate owners in the U.S. And globally, we just have an ability to de-risk that for the brands that we invest i…”
Real estate represents 14 percent of the US economy
“Obviously, you have real estate, which is the largest industry in the U.S. It's 14% of the U.S. Economy. It's the largest asset class. It's the largest lending category. It's the largest store of consumer wealth.”
Real estate tech represents $250B+ in public and private market value
“So if you just look at, you know, two of the three largest unicorns today are real estate and hospitality tech. We work in Airbnb after Uber. And then beyond them, there's another two hundred and fifty billion of real estate and hospitality tech companies out …”
Proptech features low technical risk but massive distribution risk
“The technical risk is oftentimes very low in real estate tech. Like the innovations are oftentimes fairly lightweight, but, and here's the catch, the go to market and distribution risk is enormous.”
CBRE, Prologis, Lennar, Macerich, and Hines backed Fifth Wall
“So we first got CBRE, the largest commercial brokerage. Then we got Prologis, the largest industrial REIT. Then we got Lennar, the second largest home builder in the U.S. Then Mace Rich, the largest mall owner, Equity Residential, largest apartment owner, Hein…”
Fifth Wall raised $110M almost exclusively from corporate LPs
“The first roughly hundred and ten million dollars we raised was almost exclusively from these large corporates”
Fifth Wall completed its first seven deals without competitive bidding
“To date, seven deals, and in none of those deals have we participated in competitive fundraising processes.”
Fifth Wall will not compete with Benchmark, Sequoia, or Lightspeed
“And we're not going to compete, obviously, with Benchmark and Sequoia and Lightspeed.”
VTS is the first platform digitizing the offline real estate leasing sector
“Portfolio management and property management and leasing management is an enormous industry that is effectively all offline today. They're really the first company to bring it online.”
Fifth Wall launched the first consortium model in real estate tech
“Partnered up with my co-founder on Fifth Wall, and we decided to launch the first consortium-based model to innovation in real estate tech”
Digitally native brands trade at lower valuation multiples than software companies
“I think the corollary point is that generally retail concepts and digitally native brands trade at lower multiples, right? So that is reflected, of course, in valuations.”
Fifth Wall's retail fund targets brands with $10M to $25M revenue
“And that's frankly where our fund has focused. It's exactly on brands that are at that inflection point. And where that typically happens is somewhere between Series A and Series B. Anywhere from 10 to twenty-five million dollars of top-line revenue for a bran…”
Real estate is the largest US industry, representing 13% of GDP
“Real estate is the largest industry in the US. It's really 13% of the US GDP.”
Invitation Homes IPO'd at $6.5B after buying 50k homes programmatically
“And then he actually went on to co-found this company, Invitation Homes, which was the largest owner and operator of single family homes in the US, which sounds on the face of it like a real estate company. But really what they built was a technology stack Tha…”