Digitizing real estate

Digital transformation in real estate

Podcast episode 36


Podcast Summary

00:08 Home office experience as a company and an individual during the lockdown period

04:43 Nomoko’s vision and steps towards realizing it

09:15 Nomoko brings Digital Twin to the real estate

13:40 Nomoko creates spatial application for the real estate industry and the rationales behind

16:00 We started with understanding customers’ pain points

21:00 Switzerland’s readiness to adopt spatial applications

24:34 Nomoko’s spatial application beta tester program

26:19 Digital Davos Forum on the 24th of September 2020

29:30 Visit nomoko.world for more information

Full Transcript

Bara (00:08):

Hi everyone. And welcome to the first episode back at the studio, after (woohoo) with Nilson, one of the co-founders of Nomoko, (for those who are new). And my first question is how is it to be back at the office?

Nilson (00:27):

I think we went through an extremely weird period. I hope we will never experience that again as a society. I think we’re all aware what happened, took the choice to do a complete remote office or home office setup for us as a company. And I discussed with a lot of friends, how is it going to impact the future of work? How is it going to impact the wave? I think this is going to be… Yet to be determined. I think there are two sides of things, some people really love the fact of having home office and being able to stay at home, no need to commute and have their own setup. And yet another part which says, well, it’s difficult to build culture. It’s difficult to be at home.

Nilson (01:10):

I need to have that place where I go to and have my kind of work set up. And because everyone now experienced what a full home office set up is for the first time also for a longer period of time. And this is a kind of collective experiment that has been happening. Those two sides, I think, are getting more confirmation for their view. So I think it’s going to be interesting to see how it will evolve down the line, if it’s going to end up in a big mix where you have those people that wish to do home office and embrace that and people who live in a different country and just enjoying their time in home office, but they can be somewhere at the sea and nature. So there’s this one part. I think coming back to office on the first week, everyone is probably experiencing amazing time in terms of being able to see everyone again.

Nilson (01:52):

I am happy to see everyone and a lot of excitement in that very moment. And I think now it’s going to be the question with Switzerland is starting to be in a similar situation where someone travels from Spain have to self quarantine for 10 days, as well as from Luxembourg where Vincent (Nomoko’s co-founder) is at the moment. So we’re going through multiple episodes basically now where we will have isolated moments where people are forced to be in self-isolation, depending on where they travel. And I think for business travel, as well as for companies, this is going to be a gigantic challenge on how to manage that. Because now we’re going to have these hybrid situations where some people have to self quarantine and other don’t, some countries you can travel to and do business easily, others you can’t.

Nilson (02:47):

So this is going to be a very, very tricky situation to navigate, I think for businesses, but also for people individually. I mean, if you plan your holidays, you suddenly are in a country which goes on a blacklist and you come back and you might even live in a scenario where you have flatmates. They have to then suddently self quarantine for 10 days as well. So I think it’s going to put everyone in front of difficulty. So I’m very curious how this is going to play out now, also from the governments and how they are dealing with testing and how they’re going to find maybe different solutions as well.

Bara (03:23):

And that especially, I mean, in our case, we have, I think the Spanish case applies because we have quite a part of our team, also Spanish nationals who are very happy to go home for holiday finally, and then realizing halfway through their holiday that they have to self quarantine when they’re back. And I think yet it’s going to be this hybrid model, but I feel like we’ve gotten really used to it. And at the same time, we’ve also seen that productivity levels have not been affected. And if nothing, there’s a lot of people. I mean, I saw it for myself. I managed my time. I have to say at the beginning, I was like, you know, not taking breaks. And I’m like the thing of having your bed so close to the table where you also then work and stuff. And then you realize that to go to work, takes you literally 10 steps.

Bara (04:07):

Then you start the morning actually working in your pyjamas. And then da-da-da what I did for a while. And then I realized, okay, I need to have a routine. This will take a long while. This will be the state of school for a few months. And I mean, now look at us, we’re mid August, we’re back at the office, but it’s somehow part of our life. Now that I think also if it has to, for some reason happen again, I mean, we never know. I think people are way more equipped to resume, work as normal for me. I think the big thing is as a company, we went through as a change and also realignment on where our focus lies. And I think that’s where I want to guide the conversation – as a company that has this big vision that has not really changed – “building the Mirror World”, allowing any software developer in the future to build spatial applications using these building blocks, to have Digital Twins at city scale, either spatial data integrations and basically bringing all of that together so that people can get creative and build these digital solutions that connect seamlessly with our world.

Bara (05:14):

What has this past few months meant for us in terms of what are the steps we’re taking to get to that vision? And why is it actually worth spending now some time on it?

Nilson (05:24):

I want to tackle this in two essential steps. I think first for us as a company and then sharing a bit, the experience with other companies and maybe our general analysis under different markets that were also there were also touching. I want to answer this in two different parts in terms of question, because I think we could answer for us as a particular case in, as a company. And I’m very excited about what is coming there. And on the other hand give you maybe a little bit of a, of an insight, how we then analyzed also the industries and the markets, the industries that we touch and, and what’s going to happen to them to also give a bit of insights, basically how we took a decision us as a company, and maybe you can take something for your door, or also not first for us as a company, we did a lot of experimentation to pass 12 to 18 months where we really said, okay, how and where in terms of industries who will adopt this first.

Nilson (06:16):

And I think in the end, we always go back to the same vision where we say you want to make the interaction between the physical and the digital world, much better than change the way that software and humans actually interact with the physical world through digital means. Big question is which of those industries, which are touched by that verges saw almost everything. I mean, this is augmented reality from self-driving cars to real estate, to architecture, to all of these different things. They’re in the end, all touched as long as they have some activity in the physical world, then you basically impacted by this new shift. The big question, I think exactly the same question. As you have to ask yourself in the 90s, when the internet started, this is going to be different cycles and it’s going to be different kind of almost areas or areas where different things will come on.

Nilson (06:59):

The internet and different things will be disrupted, but at fourth industrial revolution and not everything will happen at the same time. There’s different majority, also necessary in terms of technology in terms of market adoption, in terms of business models. So a big question is going to be able to determine kind of which industries and which products have their significance or their possibility to adopt based on market and technology means at what given point in time. And I think a famous example is in that sense, VR, which was already discussed about of days of the internet, right? Everyone was like, this is going to be the next big thing. And this is an inspired matrix. And all of those, you know, also in that sense, this utopian sci-fi scenarios, but it took another 20 years in order for technology to even get remotely to a point where you say, not as it’s going to be convenient enough to start hitting mass market and still today, I think, despite the Oculuses of this world and everything, it has not yet gotten to a point where you’d really see mass adoption.

Nilson (07:57):

So this is a concept which has been around for a very long time, but the technology is just trying to get to a point where it’s convenient and immersive enough to really make a difference. And I think that’s going to be very similar with what we’re seeing as well, machine learning and AI has undergone of waves like multiple times now. And I think it’s very easy to imagine what is all possible, but then also time it well, this is going to be the hard part now, if it applied to this whole notion of a Digital Twin or having a digital representation of the physical world and all the use cases we were off this from the very beginning that there is a vast amount of possibilities and the big difficulty is going to be navigating through those possibilities and actually narrowing down a focus – what we should tackle first as a startup.

Nilson (08:43):

And I think as any company, you have to be able to narrow this down to be really make a dent before you can generalize it before you can really broaden things up. And then I think we took the approach to actually broaden up in order to see which industries react and give us the opportunity to really do that market study, that active market study. In fact, in order to talk with that many companies and interact with that many different use cases, to be able to then say, well, this is the difference between talk and this is where really things happen. And that’s where we were a bit surprised by the industry in the end, which one it is, but then looking backwards it’s also actually quite obvious. What we ended up after having all of those experiments is that the real estate industry is actually the one, which in our opinion, will pick up at mass and at scale, a Digital Twin concept first, which has a couple of different reasons.

Nilson (09:35):

And I think the very first reason that really for me looking backwards at it is the one that, that strikes out the first is that essentially, has it been an industry, which is in terms of financial size is gigantic. And it’s one of the very few, very large industries, which has almost been untouched by digitization in the past 20, 25 years. And then you can start to ask yourself, why is this the case? And of course you have some of the portals which helped you to rent apartments and sell houses and so on. But I think in vast majority terms as well, also PropTech is coming up. It has been an undigitized industry and they have been doing business the same way as they have been doing it 20, 25 years ago. And I think a big part of this is because the internet digitized information, they digitized the non-physical space.

Nilson (10:27):

And that’s where you had scalability, where you have global companies – why Google and Facebook grow so fast because they were basically global companies from day one and they didn’t have distribution issues or anything. I mean, Google could search the entire internet from day one because the internet was global, right? That has basically fuelled this entire radical growth of the past 20 years. And now we’re kind of going to a point where the real estate industry had never had the concept of digitizing the physical place. They never had all the information about a physical location in one place. Of course you have maps in GIS systems, which helped with some of the topics, but has not been brought to the point where actually the house as an asset has a digital footprint or has a digital identity or anything like that as a concept with the Digital Twin, that’s actually the first time where this will start to happen.

Nilson (11:20):

So now you actually have the basis that the digital disruption can truly happen within the space where you can automate processes, where you can start to eventually bring machine learning or predictive algorithms into it, and actually have the decision-making because the information about the physical place is accessible to the software world in the first place to start with. And I think that, or is a dramatic shift for that industry that now their assets will be available to the digital universe in the first place. So the base is actually for digitization and to really leverage the superpower that digital technology can bring, is actually only feasible once you have that digital twin. And I think that’s the realization, which is quite fundamental for that industry. And I think makes it also clear to understand why it hasn’t happened. This doesn’t mean that it’s now it’s going to be easy and everyone is going to jump at it.

Nilson (12:09):

I think that’s very important to understand it’s still going to take a time a while because it’s behavioral change, because people have to adopt new technology. And we all know that for past experiences new technology is not adopted overnight, but as the whole society’s already in touch with digital technology, our prediction will be that, for that particular market and, for a particular industry now adoption will not take 20 years, but actually will happen very, very fast. And interestingly enough, I think that whole experience with people being in lockdown – travel is restricted, personal meeting is restricted – that’s something which also that industry is very heavily based on. So now suddenly everyone experienced that while there is Skype, there is Zoom, there is Teams, there is Google Hangouts, whatever you name it. There’s actually tools where you can meet in kind of virtually, not in person and we can meet in a virtual identity.

Nilson (12:59):

And it’s not that bad. You know, sometimes you still lose the first five minutes where everyone was like, “Oh, well it doesn’t work”, my connection on my video and this and that, or people are on mute or whatever the background might be. But so yes, maybe it’s not as efficient and is not as good as being in physical form, but at the end it still works. Right. And I think especially for those industries which have not used digital tools in the first place, they got in touch with it and they were forced to use it. Bank is a very good example for this as well. Everyone suddenly realize, “Well, you know what, this fear of it not being possible or not working actually – it actually worked”.

Bara (13:40):

Yeah. Because if you don’t have a choice, you suddenly realize you work with what you have. We suddenly realized, “Oh, there are so many powerful tools and everything”. But I think what I want to circle back to us, what we’re essentially doing is building our first spatial application. What is the rationale behind it in the larger scheme of things?

Nilson (13:58):

As a rationale behind, it is that in the end we say, well, if it’s kind of making the comparison to other tools like WordPress or something, which are dared to let you help build websites, I think if you haven’t built websites yourself and brought them to market and, and understand everything, that is a challenge, it’s going to be very tough to build that toolbox and build it in a meaningful way. If you don’t know how it is to build that part. So it’s like kind of company who builds tools to build a car and never has built the car themselves and don’t have the knowledge for it. It’s going to be very difficult. That’s one rationale, which is the very obvious one, which we always knew and said, okay, this is actually good, because we also don’t want just to build a spatial application for the sake of a demonstration.

Nilson (14:36):

I think that should never be the case because it should always be driven with the commercial background. So that’s why we picked that industry and did experiment first to say, well, for which industry is it worthwhile to make the effort of building it to an entire self-standing application in the first place? So it also has to make money and we’ll make a lot of money in the first place. So this is one part, but the other part is also what better way of communicating that new future than by actually showing it. And in the end, you can of course throw a lot of money at marketing and convincing people that they should be using tools and data and services and everything around it to build new type of applications and try to convince them and find partnerships. And of course that’s possible. And of course that’s something which is feasible, but we’re a big believer that the much more efficient ways is just to show it and just to show what is actually possible, how can you build it and then open up the pathway and say, well, listen, we used those tools ourselves.

Nilson (15:32):

You can build the same thing and it’s going to take you a couple of months and then you’re at the same point and can actually benefit. And you can now unleash your creativity and actually have the tools for it in order to implement in a relatively short period of time, relatively convenient. And that’s something we just simply experienced that in the end, whatever we do in terms of efforts, that’s going to help us a lot to communicate very efficiently, that vision of spatial applications by simply doing it and by simply showing it.

Bara (16:00):

And it’s also about understanding the pain. And I think for us now internally, it’s also like we are making a spatial application for real estate developers while in the long run, our goal is to actually help provide tools for software developers to then build applications for their audience. Right? And I think now it’s this interesting part of saying, well, we are learning or we’re discovering the pain points that our target audience is going through for our real estate solution. But we’re also understanding what kind of crazy pain a software developer would be going through today if they were to build a spatial application. Spatial application being an application that actually uses all sorts of spatial data together from different sources, integrating ultra accurate 3D data, these Digital Twins, all of this together to actually make them cohesive – today is simply a pain. And I think this is where it is.

Bara (16:54):

Let’s say path is so interesting because this is exactly what we’re trying also I think to show is it is such a pain. Why is it so much easier to build a website today? Because the pain of building it has been addressed very long time ago, we are at a point where I can go without any coding knowledge and build a website. But at the beginning, the barrier to entry was so high. I could not have built a website 10 years ago. Maybe not even, I think I would say like 10 years ago, 15 years ago, without any coding knowledge probably would have been very difficult for me.

Nilson (17:28):

You think it started around that time?

Bara (17:30):

But then it was like a lot of this WordPress, blog…

Nilson (17:33):

Wix dot com and all of this, but as it’s like, not yet, it’s, it’s in the end, plus minus 15 years. And it’s right around that edge where it started to shift.

Bara (17:44):

I think that’s the same analogy, right? It’s this, we’re just at the beginning of this, it is a massive hurdle. It is a massive pain right now, you know? Cause there is so much spatial data out there. I mean, we always talk about it. We’re not going to be creating all of that spatial data. We always came from the Digital Twin space of the 3D side ultra accurate segmented data, but we’re also integrators and we’re, we have this kind of holistic approach to spatial data. And I think also this view of you – ideally in the future, you do not have to be a GIS expert to work with spatial data and opening it up to others because in the end it’s still our world around us, the physical world that has not been made very accessible digitally to have whoever wants to get creative with it.

Nilson (18:28):

Yeah. I mean, you put it very well. I mean, in the end, I think the level of expertise today that you need and the level of heavy lifting that you need to do in order to get something to market, which is presentable, which is kind of in line with the current standards of what are people used to, is gigantic. And I think that’s exactly that hurdle to bring that down is going to be a ginormous catalyst in order to make it possible for the creativity, which is already happening. And I think that’s the amazing part. So we are already at a point where the concept of a Digital Twin is slowly sinking into the minds of people and they slowly start to think about ideas. How could they actually bring something to market that is using this concept of a Digital Twin? So I think that that’s the beautiful part we are in as an industry, but now those creative ideas are mostly not coming for people which have a gigantic deep technology understanding, but they have a very, very good customer understanding because they might come from the field or because they’re an entrepreneur or because whatever reason is there. Now, if they would want to build such an application would take them two, three, four years just to get the basics up and running in order to get to that point.

Nilson (19:38):

And I think that’s the fascinating part at now. We’re going to enter a period of, I think in the next two years where you will have a lot of creativity starting to happen and the demand will search, but the supply both in terms of data, as well as in terms of tools is going to have a very big race in order to be able to catch up, to provide the functionalities and the convenience to that industry. And I think that’s a bit the difference too. Also the early days of the internet, where you had, of course, none of those tools to really support you and everything had to be built from scratch, but no one was used to having those tools, right? No one was used to that convenience. No one was used to that. And today, we take it for granted that it becomes so easy to build something on the web in comparison to 25 or 30 years ago.

Nilson (20:24):

So that expectation is also going to raise, of course, the bar for delivering the tools and everything around it for spatial applications. That the expectation is that it’s going to be very easy to use from the very get go. On the other hand, of course you also have a lot of things to look back towards and learn from, right? So we have a lot of the learnings that have been done in order to provide web development tools. And also as the case for other softwares or platforms like iOS and Android, you can learn from that, right? So this is gigantic kind of head start we have as a company, we can look at this and then basically say, well, that’s the parts which worked well for those companies. This is the essential bits and pieces which need to be there in the first place.

Bara (21:00):

So how do you see given that, of course our focus today (I’m not saying tomorrow) but today is Switzerland. No, but I mean, our focus regionally is let’s say DACH region, especially Switzerland, Switzerland is known for creating innovation, but how is it about adapting it? What about the readiness for something like this? What have you heard so far from people we’re talking to about how they look at the industry, the level of excitement and so on and so forth?

Nilson (21:32):

The fascinating part we are in as a company, but also as a society is that, if you look at the stock market, almost all digital technologies have picked up gigantically in the past three months and the entire kind of notion of being in a lockdown and not having the ability to travel and to move places and be confined to your home has brought a lot of people closer to web or digital technologies. You see it with e-commerce. I mean, e-commerce has searched for obvious reasons that that’s a behavioral change at the last, let’s say 20, 30% of the population, which have potentially never ordered something online, were potentially forced to order for the first time online and go through this experience. So it kind of is a push towards digital adoption. It’s kind of like a supercharged for those who even didn’t adopt it, that they had even to go that far.

Nilson (22:22):

Right. That’s going to, I think if any digital technology, a push going forward and accelerated some of those paths. Of course you have an industry which is not vastly used to digital tools. That’s of course something which everyone has to be aware of going into the real estate industry. But on the other hand is also something where you have a lot of young people entering the space and they’re used to digital technologies in their normal lives. And they’re asking themselves the question, well, why don’t we have something for our professional life? This makes no sense. And I think that’s the good point of being also in terms of timing is that that sparks a lot of excitement, a lot of the things which simply haven’t been possible a couple of years ago are now getting possible. And that’s the beautiful part of that industry that there is still so much room to grab for digital companies.

Nilson (23:09):

And it’s such a large asset class as well, so that there is a massive point for growth. The focus I think on Switzerland for us as a company is very simple. In the end with all the restrictions in terms of traveling and logistics, we simply said we will crush that market here and entirely focused on Switzerland. It’s a beautiful testing ground because we have a lot of diversity within the country in terms of legal rules. And for those who don’t know, essentially Switzerland has very independent form of government where all the cantons (kind of like the States in the United States) have a lot of independence, but the only difference is that for us the Canton is 40-50 minutes drive apart. So it’s very fragmented and very granular in that sense in terms of spatial distribution.

Nilson (23:55):

So that makes it very interesting for us to, how do you, of course, the kind of worst case scenario for digitization, because you have to map these kind of things in a very granular way, and you cannot say, well, this is now something which is applied in terms of, for instance, construction law or whatever it is for, I dunno, an entire region. And I think that’s something which is much harder than if you could say, well, that’s the same law for all of the United States. So within basically one click you are with one implementation, you have then entire state sold. Here, that’s going to be a lot of local implementations, but that also teaches us how to do that. And I think that’s also one of the parts where we said, this is actually setting us up for success for the other countries too.

Bara (24:34):

So what is the stage we’re at right now?

Nilson (24:36):

So right now we’re on-boarding the first users, we have a beta tester program, which is we’re in a fortunate position that we had way more subscriptions than we even hoped for. So if you are someone who wants to test our product and give feedback and be basically part of that journey of shaping it and pushing it in a direction that is useful for you, then now is the right moment. If you are a company which wants to be in that innovation cycle and really wants to be at the forefront of digitization for your sector – it’s a perfect time. And we’ll have a more public launch later this year in terms of opening up to the entire public. That’s I think the normal lifecycle for any software product these days, and that’s going to be a lot of experimentation in the next couple of weeks, especially on the user side of things.

Nilson (25:23):

And because I think that’s where in the end, spatial representation of data gives you so much room in terms of how do you display it, how do you interact with it. And you have to adopt it to your end users in the end. There’s so many different paths. You have users which are coming from the gaming world, which will interact with the virtual environment much differently than to someone who has never used this before. So that’s going to be a lot on the kind of usability front, a lot of experimentation there. And I think that’s also going to be interesting for the future is basically from a design point of view is how do you make the switch from what we’ve been used to in the past 30 years on a 2D design? How do you basically have user interface and user experience on a 2D surface? And now how do you have it on a 3d surface? So how do you have it really spatially in that sense, which is of course, you can get inspiration from game development and everything around that. But I think it’s not yet within the vast adoption. So it’s going to be very interesting to see what it’s going to be the outcome.

Bara (26:19):

And at the same time, I think you’re going, or while you’re not going, but you will be participating, you will be holding the expert discussion at the Davos Digital Forum, which I believe is on the 24th of September, in the morning. And there, you will be talking about the concept of the Digital Twin. Are you also going to be talking more in relation to proptech and to real estate? Because obviously it’s for an audience that is a lot about, you know, regional developers, architects. So is this what people can expect from that panel?

Nilson (26:54):

Yeah, exactly. I think what we will always as a company is to push communication first and market education. What is Digital Twin and to inspire people about the concept that they can also have. I think that’s something that has been very successful for us as a company, that if you do a good job on that front, if you have good people on the other side, which are creative and which are, let’s say digitally savvy, they will basically tell you the ideas into solutions they have in mind, which has been one of the most rewarding kind of parts of my job to see that creativity basically just unleash one, if you trigger that conceptual understanding. And of course the other part is demonstrating what we’re doing on the real estate front to showcase and see how can this be used by people.

Nilson (27:36):

And I think that’s going to be really interesting, especially also for non-readers and developers, because they will start to see, okay, this is how that particularly industry or that particular kind of sector within the real estate lifecycle is looking at it, which is really the face of how do you identify and make basically investment decisions around properties. But of course the real estate industry, in that sense, doesn’t stop at identifying and making investment decisions, but there is the entire section for architects where you plan your future building, where you design it, where everything in that sense comes in. And then you have the construction industry, which is all about how do you now implement the plan into reality. And then you have the entire facility management, which takes care of the property once it’s built. Of course, doing that crossover and say, well, this is how we do it in that particular sector, or are part of the real estate life cycle. How could other parts profits from the same, and despite the creativity there, how they could apply it for themselves, they’re going to be very interesting to see how this is going to be also because a lot of municipalities are going to be present, how they also see the opportunities because in the end, they have to verify all the requests for new buildings and we’ll start to see opportunities how they can automate some of those approvals and potentially also public participation in the decision making process.

Bara (28:48):

And the amazing thing is that the event is now all digital and anyone can take part. And I think that’s the beautiful upside of the current situation (corona times), is that a lot of these events are becoming very democratized. They’re extremely high quality, and yet they’re available also free to participate. So I will make sure to share the link later, but yeah, it’s something coming in a few weeks from now. And I think it’s great to see how things are moving and this will definitely not be our last segment on real estate. We have some very interesting guests planned out for the upcoming episodes.

Nilson (29:26):

It’s just a small teaser. I think we will go in much more depth.

Bara (29:30):

But thank you so much for finding the time. Thank you everyone who tuned in and make sure to subscribe. And for those interested in what we’re currently up to with our real estate spatial application –

Bara (29:42):

Nomoko.World, and you will find us and you will be able to sign up for the beta program. Thank you so much. Have a lovely day and thank you, bye!

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