- Tell us about Skwire and what the company does.
Skwire focus on tech-first real estate investment, using our AI algorithms to process millions of datapoints in order to spot nuanced trends and identify the best potential properties to invest in for the private rental sector (PRS). Unlike virtually all current UK PRS, our focus is on using data to identify properties in the existing housing stock rather than Build to Rent properties.
Alongside this, we have also developed a tech-supported property management system that enables us to deliver a flexible rental product highly tuned to tenants’ needs. This covers everything from ensuring that people have a responsive service through to providing flexible rental products that meet their requirements.
- What made you decide to set up Skwire?
A combination of two factors was the motivation behind Skwire.
A key aim of ours is to offer a better rental product to tenants. I realised that the standard of rental products available in European countries, such as Austria or Germany, was far superior to renting in the UK. People have more freedom with their properties as tenants and typically rent for longer periods. But renting in the UK is much more transient, largely because people are always looking to get onto the property ladder despite reports showing time and time again how difficult this can be for first-time buyers or young families.
The other prompt was a keen desire to apply data science to a sector that hasn’t seen it before. I worked at a fashion and furniture search engine previously, setting up data science systems to predict sales and demand trends. I realised that a similar strategy could work well in real estate, and in PRS especially where there was significant potential to capitalise on data, so we developed our AI algorithms to predict the best-performing potential assets in the rental market, investing in a first property portfolio that proved our concept.
- How does Skwire help property investors to enhance yields?
Skwire is more geared towards institutional investors than individuals. Through Skwire, these investors can finally access diversified, distributed existing single-family housing stock in the UK. This is a significant part of our offering because PRS is currently geared more towards new build to rent properties and is in many ways neglecting the clear potential of picking up available housing stock, whose rental revenues we can estimate with an above 90% accuracy thanks to our algorithm. So far, we have proved the concept by investing in a number of properties that have given a 11% rental yield before leverage.
- How does your offering benefit tenants?
Recognising tenants’ needs is at the heart of Skwire. Firstly, this means offering comprehensive levels of flexibility around what people want and when, from lease lengths and the types of add-on services they can access. In doing so, we are making sure that tenants pay rent reflective of only what they want and need. Secondly, our property management service ensures that people have a positive experience with a landlord who is responsive to and engaged with their needs: say you have to report a maintenance issue – You simply take a picture of the issue and provide a short description, Skwire’s property management solution will triage it, dispatch, invoice and settle with the correct responder and allow you to follow the status of it until resolution. Tenants are never left feeling like they are “shouting into the void”.
- Companies like Skwire are spearheading tech’s disruption of the property industry – what do you think the future of proptech looks like?
I believe that a big trend will be around construction tech. In London in particular, the housing stock is relatively low-density, so I think we will find a lot of construction tech-enabled companies building upwards towards greater density housing.
Another trend that I expect to see would be in property management. At the moment, companies are often either a developer or a property manager – very few companies do both well. All too often, property management seems to rely on standardisation as the solution to increase efficiencies, which is at odds with personalisation and flexibility which we as a society seem to be looking for at the moment. The rental market is naturally better geared towards this than property ownership, but only if it moves on from its current state.
- What are the challenges that the proptech sector must face?
The problems that proptech is solving right now are not always universal problems. At industry gatherings, you will very often find proptech-on-proptech presentations – a room full of solutions and no property managers, no agents, no property investors to evaluate their real-world value. Especially from a tech perspective, I think a lot of early-stage startups are working on developing single-point solutions for fairly similar issues, overlooking the potential for vertical and horizontal integration. As awareness around this grows, I think we will see a resultant trend of consolidation and partnerships to better capitalise on demand.
- Property and technology are male-dominated sectors – have you found this challenging and, if so, how have you dealt with this?
As a company, Skwire sits between property, technology and finance, which are three particularly male-dominated sectors. Tech is a clear example, with women holding only 10% of leadership positions, and in the UK last year only 25% of startups securing equity investment were female founded.
Personally, I have never directly experienced any slights or challenges – I do occasionally encounter a surprised face or two when our (female) Head of Investment and I walk into a investment meeting, but the second our credibility is established I don’t think we have ever been treated with anything less than courtesy.
