This article appears courtesy of Business Matters Magazine

A lot of the innovation in tech at the time coincided with the first dot-com era. I was very much part of that ecosystem and feel California has left a lasting imprint on the way I view the world. People who know me today as a Mayfair based venture capitalist would be surprised to hear that I actually did some of the software coding for Web 1.0. I was also was one of the thousands laid off when the dot-com bubble burst in the early noughties. I’ve been through that cycle, and survived it with battle scars and inspiration that I brought with me when I moved to London in 2009.

When I joined hands with James Caan in autumn 2009, I entered the business world in Britain with an open and inquisitive mind. I wasn’t quite sure which industry I was going to disrupt. It just so happened that we were in the midst of a global recession fuelled by a property boom and bust cycle. There were definitely similarities with the early noughties recession in the U.S. I observed an industry in churn where people had been laid off and teams were in movement. To me, the property sector seemed ripe for disruption. What had worked before wasn’t going to work for the future – and a lot of bright, talented people were now idle and looking for new ways of doing things. My thesis for investing in property innovation in 2009 was really that simple, but it’s one that has quickly proven to have some legs.

As a venture capitalist – I was a recipient of the business plans created by the unemployed-come-entrepreneur masses created out of the “Credit Crunch” – so I had an apex view of what was going on in the property sector and had a premonition of what would come. At the time James wasn’t looking at the property sector in a VC sense, but seeing the similarities with what I had experienced in the U.S., I saw an opportunity. You only have to look at businesses like Skype and LinkedIn, which both launched during the dot-com recovery, to see what can be born out of ecosystems that are in churn.

I felt that this would happen again with the property sector in Britain, and I wanted to be at the centre of it. A lot of innovation is formed out of constraints. When faced with adversity, people tend to tap into recesses of their brain that they wouldn’t normally utilise. Armies of innovators, faced with numerous constraints – the newly unemployed – were formed almost overnight. Like never before, people were questioning the status quo and challenging a sector that has been starved of innovation for decades. This was an early indicator of the change to come.

The drivers for property innovation in Britain go beyond market churn and constraints. I have definitely seen a “cluster effect” happening. In many ways, London is to the property sector what Silicon Valley is to tech. Real estate in London attracts investment from all over the world, and London is a global hub for professional services. There are financial, legal and accounting services that are built around the property sector here. And – because of the number of transactions and overall strength of the sector – there are all of these other support services that you wouldn’t see to the same degree in other parts of the world. The UK has a worldwide reputation for its property related services. You have British architects working on projects in Kuala Lumpur, British project managers in Dubai, and British agents and furniture people jetting off to new-development launches in Southeast Asia.

That said, we have also seen a massive influx of international tech talent. Since 9/11 immigration restrictions in the U.S. have become tighter – and a lot of international talent that would have gone to Silicon Valley – has set up shop in London instead. We now have a vibrant tech hub of our own – “Silicon Roundabout” in Shoreditch. Many of these tech entrepreneurs will try to solve problems in other industries, and we have seen hybrid businesses forming: FinTech, HealthcareTech and also PropertyTech. Rightmove and Zoopla are examples of that collaboration. These success stories have been an inspiration to both property and technology entrepreneurs alike.

What’s interesting is that it is people coming in from other sectors that have created this innovation. Alex Chesterman, the founder of Zoopla, for example, first founded an online DVD rental service which eventually merged with Love Film. No doubt he drew on his lessons from the subscription e-commerce space to disrupt the property search space.

People from other sectors aren’t boxed in by traditional ways of thinking. They are more likely to challenge the status quo and look for solutions. I’ve seen some very interesting business plans from these “industry connectors” – those that straddle two different industries and innovate by connecting dots that wouldn’t otherwise be connected. I’ve seen new ways of delivering estate agency; there’s no reason why estate agency shouldn’t go in the same way that the travel agency industry has gone – completely online. I’m also seeing plans for online household property services. It’s so cumbersome to manage all of the services that come into your house. Why is it so disparate to order a cleaner, gardener, babysitter, or plumber? There’s no reason why you shouldn’t be able to order these services through a single app on your smartphone, pay through one account, have all appointments sync with your smartphone calendar, and know exactly what you’re getting through an Amazon-style feedback loop. I’m seeing a lot of interesting things like that – and I believe it’s just a matter of time before streamlined offerings like this become commonplace. I call this next wave Property 2.0. And it’s coming soon to a home near you.

Perhaps more surprisingly, I’m seeing a lot of great ideas in the commercial property sector too. Unlike the residential sector where people tend not to have a vocational degree, the commercial sector is highly influenced by the Royal Institute of Chartered Surveyors and the associated RICS accreditations. While this has been good for the industry in terms of making service levels more uniform and consistent, it hasn’t necessarily been the best thing for innovation. But once again, “industry connectors” are making their entry and changing things. A business called WeArePopUp.Com is an online service that enables landlords to fill vacant units with ‘pop-up’ tenants that are looking for space for a short period of time. With the challenges the high street and retail sector are facing, this is a clever solution that again is born out of an industry in churn. I’m not surprised to learn that the two guys that set up the company are not from a property background. This is a start-up borne out of disruptive thinking from a strategy consultant and a research scientist.

It is examples like these which reinforce my belief that the UK is certainly a leader in property innovation and PropertyTech. One of my co-investors from the U.S. has been surprised by the businesses I’m showing him in the UK, and through his venture capital vehicle he’s now spending quite a bit of time with me looking at businesses over here. Of course, businesses don’t have to be tech related to be innovative. I’ve invested in an investment advisory firm called 90 North Real Estate Partners. They have taken advantage of Islamic investors’ appetite for UK property by structuring Shari’ah compliant real estate investments. Not a technology solution at all, but one that responded rapidly to changes in the property fund management industry.

Being a generalist by nature without any preconceived notions, and as a venture capitalist, I tend to look at the property sector from an aerial view. From where I’m sitting, British innovation is very much alive and kicking. If you want to create a conventional business, a high-calibre management team with sector depth has a good chance of delivering success. But – if you’re looking to create an industry beating, category defining business – team up with someone outside of your sector. The debate you’re going to have about challenging the status quo is what’s going to drive ideas and create new offerings. What I’d really like to see is more marriages between the property guys in West London and the tech guys in the East. On my own VC platform, my strategy is to bring these two polar opposite worlds together like an arranged marriage.

Zoopla – the champion of inter-sector marriage – has recently hired a major investment bank to explore growth opportunities for the business, with one option being an IPO that would potentially value the business at £1.3 billion. I’m convinced that a billion pound business could not be built in just five years with insular thinking from the property sector alone. For Property 2.0 in Britain to really flourish, we need to see the West End property professionals spend a bit more time getting to know the East End technology entrepreneurs. It’s a match made in heaven, and one I understand quite intimately as my Californian battle scars and wisdom shape my forays in Britain’s property sector.

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