Proptech in Mexico: Growth, Innovation and Future in the Real Estate Sector
Here's everything you need to know about proptech in Mexico
The Proptech industry in Mexico is experiencing exponential growth and significant disruption. With more than 112 active companies in the country, 84% of which are of Mexican origin, it is positioned as a potential leader in the next wave of innovation. In this article you will learn what a proptech is, the current panorama of Proptechs in Mexico, as well as their financing and the economic impact they are generating.
What is a proptech company and what does it do?
Let's start with the basics, a proptech company is one that uses technology and innovation to transform the real estate sector with digital solutions and technological tools. Their objectives may vary, but in general they seek to optimize processes and improve the experience of owners, investors and end users.
Financing in the Proptech industry in Mexico
Now let's talk about financing, despite macroeconomic conditions, proptech companies in Mexico have secured significant amounts of financing. According to the first proptech report on companies operating in Mexico by Endeavor and MatterScale Ventures, in 2021 proptech companies ranked as the third industry with the largest financing in the country, raising US$921 million.
Although there was a slowdown last year, in the first quarter of 2023 companies in the sector have raised $21 million in venture capital. In addition, they are opting for new forms of financing, such as debt and lines of credit, totaling US$128 million, an increase of 24% over the previous year.
Future prospects and growth opportunities
With the Mexican real estate market on the rise, generating US$69 billion, proptech startups represent at least 3% of the market share. This highlights the considerable growth opportunities and untapped potential in the sector. According to the Endeavor and MatterScale Ventures study, proptechs are expected to lead the next technological acceleration in the real estate sector, driven by the innovation and technological solutions they offer.
The Proptech industry in Mexico is experiencing significant growth and attracting relevant financing. Companies in the sector are embracing new forms of financing and demonstrating their ability to adapt to market conditions. With the real estate market expanding and the potential still untapped, Proptechs have the opportunity to lead the next wave of innovation in Mexican real estate.
A growing employment engine
To conclude, the proptech industry has proven to be a leading player in employment generation, outperforming other sectors with an impressive year-on-year growth of 291% between 2020 and 2022. Currently, they have generated 3,434 jobs and the industry is expected to continue its exponential growth this 2023, with an employment growth rate of 15%.
This strong performance reflects the positive impact and development opportunities that proptech companies are bringing not only to the real estate market, but also to the labor market.
Source: Endeavor and MatterScale Ventures report.
Read the full report here
