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Venture funds have poured $24.6 billion into proptech so far this year. Deal sizes and the number of funding rounds are expected to keep growing.

Venture capital has invested $24.6 billion into built-world tech in 2019 up through the third quarter, according to a new report by EY and CREtech.The report predicted 2020 would be the year when category winners begin to be solidified in real-estate tech, and that the number of funding rounds and the sizes of deals would…

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Venture funds have poured $24.6 billion into proptech so far this year. Deal sizes and the number of funding rounds are expected to keep growing.
  • Venture capital has invested $24.6 billion into built-world tech in 2019 up through the third quarter, according to a new report by EY and CREtech.
  • The report predicted 2020 would be the year when category winners begin to be solidified in real-estate tech, and that the number of funding rounds and the sizes of deals would continue to increase.
  • The two largest categories tracked in the report, real estate and finance and flexible space, raised more than $20 billion each over the period.
  • Real estate and finance is a broad category that includes Airbnb’s hospitality platform, along with Opendoor and Compass, while flexible space is a tighter group that includes WeWork and its competitors, as well as coliving startups.
  • Click here for more BI Prime stories.

It has been a banner year so far for the real-estate-tech world.

A new report from EY and CREtech pegged venture-capital investments in so-called built-world tech at $24.6 billion through the third quarter, the most since 2015, which was the first year analyzed by the report.

From 2015, a total of $75.2 billion has been invested in tech to purchase, manage, operate, invest in, or maintain residential or commercial real estate.

The report also predicted 2020 would be the year when category winners begin to be solidified in real-estate tech, and that both the number of funding rounds and the size of deals would continue to increase. It separated investments into eight categories and found that the top five categories made up 93% of the funding since 2015. 

“The astounding flow of capital into built-world tech show that this is the market on the cusp of breaking out,” Mark Grinis, EY’s hospitality and construction leader in global real estate, told Business Insider in an email. “While there are hurdles to overcome, we are still in the early stages of built-world tech development.”

The two largest categories, real estate and finance and flexible space, raised $27.88 and $22.76 billion, respectively. Real estate and finance encompasses a wide variety of companies, from Airbnb’s hospitality platform to the iBuyer Opendoor and the real-estate brokerage Compass, while flexible space is a tighter group that includes WeWork, its competitors, and coliving startups.

Read more: VC Camber Creek, which has steered clear of co-working, explains how it invests in the midst of a proptech gold rush

While real-estate and finance startups raised the most capital, they also saw seven times as many transactions as  flexible-space businesses.

The top five companies in both spaces received about 40% of the total capital. This suggests that both categories have produced some early winners but that the real-estate and finance segment may be more likely to spawn some lesser-known leaders. Some of this could likely be explained by the definition of the category, which includes hybrids of proptech and fintech and actual brokerages. 

Management, the third most invested-in area, is highly fragmented, with only 8% of investment going to the top five operators. The category is defined as anything that automates certain workflows, and it includes the Airbnb partner Niido and the commercial-real-estate client-relationship-management company VTS. “Internet of things” and smart buildings, construction tech, and data analytics round out the fourth, fifth, and six most invested-in categories on the list.

Read more: Investing in real estate tech companies like Zillow and Compass is a nearly $15 billion opportunity. 3 top VCs break down the areas and startups they think will boom.

Visualization and tenant-experience startups have raised only $1.27 billion in total funding since 2015. The report predicted that visualization companies that use 3D modeling or drone mapping for marketing or design would be a space to watch. The amount of capital raised by these companies may be low, but median valuation is high.

The report also watched artificial intelligence and machine learning, an underlying category that is an essential part of the other categories. The buzz for computer-automated solutions is as strong in real estate as it is everywhere else. Since the end of last year, AI and machine-learning companies have seen a more than 200% increase in the dollar amounts invested.

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A new pitch deck from IAC’s Dotdash shows how it plans to grow its media business after the Match spinoff

BI Prime Michael Seto/Business Insider This story requires our BI Prime membership. To read the full article, simply click here to claim your deal and get access to all exclusive Business Insider PRIME content. Barry Diller’s IAC is spinning off its dating sites business Match, which will leave media properties as a bigger part of…

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A new pitch deck from IAC’s Dotdash shows how it plans to grow its media business after the Match spinoff
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  • Barry Diller’s IAC is spinning off its dating sites business Match, which will leave media properties as a bigger part of the remaining company.
  • Those include College Humor and Dotdash, a collection of 11 service-oriented sites like Verywell, The Balance, and Lifewire.
  • At a December 4 presentation to investors, Dotdash laid out its business case.
  • Dotdash has been on an acquisition spree lately.
  • Dotdash said it’s one of the fastest growing publishers online, with healthy profit margins, and is giving established brands a run for their money in certain categories, and diversifying beyond advertising.
  • Click here for more BI Prime stories.

Barry Diller’s IAC is spinning off its dating sites business Match, which will leave media properties as a bigger part of the remaining company.

Those include College Humor and Dotdash, a collection of 11 service-oriented sites like Verywell, The Balance, and Lifewire.

At a December 4 presentation to investors, Dotdash CEO Neil Vogel laid out the business case for his company, which has been on an acquisition spree lately, buying niche sites including Brides and Liquor.com.

Dotdash said it’s one of the fastest growing publishers online, with healthy profit margins, and is giving established brands a run for their money in certain categories like health, finance, and home.

It’s laid the groundwork to expand into the lucrative beauty advertising category and take on Condé Nast and Hearst, with the acquisitions of Byrdie, Brides, and MyDomaine.

The bulk of its revenue comes from advertising, but commerce is a growing part of the mix, accounting for about one fourth of revenue.

Scroll down to see how Dotdash is positioning itself to advertisers and investors:

While other digital publishers consolidate, Dotdash says it’s growing rapidly, profitably.

Dotdash1


IAC


Dotdash’s sweet spot is news and information people need.

Dotdash


IAC


Its brands span categories that are advertiser-friendly: health, finance, beauty, and lifestyle.

Dotdash4


IAC


Dotdash focuses on service and information that people search for on Google.

Dotdash44


IAC


This graph shows how Dotdash says it’s challenging established brands in categories like health, finance, and food.

Dotdash


IAC


Dotdash’s content strategy relies on 125 editorial staffers and more than 1,500 freelancers who update articles as often as weekly.

Dotdash


IAC


Dotdash sites have a stripped-down look with minimal ads.

Dotdash


IAC


Dotdash’s sites have grown their audience dramatically since it relaunched or acquired them.

Dotdash


IAC


Dotdash says advertising is growing at an annual CAGR of 19%.

Dotdash


IAC


Dotdash is diversifying its revenue mix, with commerce becoming about one fourth of revenue.

Dotdash


IAC


Dotdash calls itself an attractive platform for advertisers with the ability to add new revenue streams.

Dotdash


IAC


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The federal agency that sued Elon Musk for fraud questioned Tesla’s accounting this year

Ringo H.W. Chiu/Associated PressFinancial regulators questioned several aspects of Tesla’s accounting this year. The Securities and Exchange Commission wrote to Tesla’s finance chief seeking more information about its finances and accounting policies, and queried the company’s legal team over its withholding of information for competitive reasons. The SEC closed its review in late October, and…

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The federal agency that sued Elon Musk for fraud questioned Tesla’s accounting this year

elon muskRingo H.W. Chiu/Associated Press

  • Financial regulators questioned several aspects of Tesla’s accounting this year.
  • The Securities and Exchange Commission wrote to Tesla’s finance chief seeking more information about its finances and accounting policies, and queried the company’s legal team over its withholding of information for competitive reasons.
  • The SEC closed its review in late October, and agreed Tesla could keep certain information redacted until 2020.
  • The agency sued Tesla CEO Elon Musk for fraud last year after he tweeted about taking Tesla private and said he had secured funding and support from investors.
  • The lawsuit resulted in a $40 million fine, Musk stepping down as chairman, and board changes.
  • View Business Insider’s homepage for more stories.

Financial regulators, after butting heads with Tesla CEO Elon Musk over his tweeting, questioned several aspects of his electric-car company’s accounting this year.

The Securities and Exchange Commission queried Tesla’s last annual report and its latest second-quarter report in a letter to Tesla’s finance chief, Zachary Kirkhorn, on September 17, according to filings it shared this week.

The agency requested further explanation for changes in Tesla’s accounts, sales by acquired companies to third parties, and its exclusion of some costs from its warranty reserve. The agency also asked for more details of Tesla’s accounting of leased automobiles this year, following the release of new guidelines on their treatment.

Kirkhorn responded that the changes to Tesla’s accounts — including a big jump in its production costs — were largely driven by scaled-up manufacturing of the Model 3. He added that some of the companies it acquired were still contracted to sell goods to third parties. He broadly defended Tesla’s accounting of warranty reserves and lease accounting as kosher.

The SEC, seemingly satisfied with his reply, closed its review on October 28.

The agency also wrote to Tesla’s legal team on September 17, seeking unredacted copies of some financial information to assess whether the company was within its rights to withhold it from SEC filings for competitive reasons. In a follow-up letter on September 25, it agreed certain information from Tesla’s filings in 2017 and 2018 could be redacted until September 2020.

The correspondence suggests Tesla remains firmly on the SEC’s radar.

The agency sued Musk for fraud in the fall of 2018 after he tweeted that he was thinking about taking Tesla private at $420 a share and had “funding secured,” then added “investor support is confirmed.”

The lawsuit resulted in a $40 million fine shared between Musk and his company, Musk stepping down as Tesla’s chairman, and the company bolstering its board with new, independent directors.

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Here are the 23 companies that have hired most of Chicago Booth’s class of 2019

BI Prime This story requires our BI Prime membership. To read the full article, simply click here to claim your deal and get access to all exclusive Business Insider PRIME content. The University of Chicago’s Booth School of Business offers the third-best MBA education in the country, according to U.S. News. Booth’s latest graduating class is…

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Here are the 23 companies that have hired most of Chicago Booth’s class of 2019
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Even though fewer students are applying for US MBA programs, demand for graduates is as high as ever. Just look at where the majority of MBA students from the third best business school in the country, the University of Chicago’s Booth School of Business, ended up after graduation.

Booth released data this week on the 23 employers that hired over half of the class of 2019. These employers reflect the three industries that drew most grads: consulting, finance, and technology. Perhaps unsurprisingly, these are quite lucrative industries, with the highest reported median salaries. You can read a report on the salary breakdown for the graduating class by industry here

These are the companies that hired at least four graduates each from Booth’s latest class, listed in order of least to most graduates hired. 

23. Walmart Stores Inc.

FILE PHOTO: Walmart's logo is seen outside one of the stores in Chicago, Illinois, U.S., November 20, 2018. REUTERS/Kamil Krzaczynski/File Photo


Reuters


Number of Hires: 4

Percent of Hires: 0.8%

22. The Vanguard Group, Inc.

Vanguard building




Glassdoor



Number of Hires: 4

Percent of Hires: 0.8%

21. Accenture

Visitors look at devices at Accenture stand at the Mobile World Congress in Barcelona, February 26, 2013.    REUTERS/Albert Gea/File Photo


Reuters


Number of Hires: 4

Percent of Hires: 0.8%

20. Moelis & Company LLC

Moelis and Company


Google Earth


Number of Hires: 4

Percent of Hires: 0.8%

19. Ernst & Young LLP

Ernst & Young




Glassdoor



Number of Hires: 4

Percent of Hires: 0.8%

18. The Kraft Heinz Company

kraft heinz


Jason Kempin/Getty Images


Number of Hires: 4

Percent of Hires: 0.8%

17. William Blair

William Blair and Company


Google Earth


Number of Hires: 4

Percent of Hires: 0.8%

15. Evercore Partners Inc.

Evercore Partners


Google Earth


Number of Hires: 6

Percent of Hires: 1.2%

14. A.T. Kearney, Inc.

AT Kearney




ATKearney



Number of Hires: 6

Percent of Hires: 1.2%

13. Bank of America Merrill Lynch

merrill lynch office


Daniel Barry / Stringer / Getty Images


Number of Hires: 6

Percent of Hires: 1.2%

12. Morgan Stanley

Morgan Stanley


Spencer Platt/Getty Images


Number of Hires: 6

Percent of Hires: 1.2%

11. Microsoft Corporation

FILE PHOTO: The Microsoft sign is shown on top of the Microsoft Theatre in Los Angeles, California, U.S. October 19,2018.  REUTERS/Mike Blake/File Photo


Reuters


Number of Hires: 6

Percent of Hires: 1.2%

10. Citigroup, Inc.

The Citigroup Inc (Citi) logo is seen at the SIBOS banking and financial conference in Toronto, Ontario, Canada October 19, 2017. Picture taken October 19, 2017. REUTERS/Chris Helgren


Reuters


Number of Hires: 7

Percent of Hires: 1.4%

8. Credit Suisse

Credit Suisse


REUTERS/Stefano Rellandini/File Photo


Number of Hires: 8

Percent of Hires: 1.7%

7. PwC Strategy&

PwC


Reuters/Danish Siddiqui


Number of Hires: 9

Percent of Hires: 1.9%

6. JPMorgan Chase & Co.

JPMorgan Chase


Justin Sullivan/Getty Images


Number of Hires: 11

Percent of Hires: 2.3%

5. Google LLC

google office


Scott Brownrigg


Number of Hires: 14

Percent of Hires: 2.9%

2. The Boston Consulting Group

BCG Hudson Yards 6903


Sarah Jacobs


Number of Hires: 35

Percent of Hires: 7.2%

1. McKinsey & Company, Inc.

McKinsey & Company logo


Thompson Reuters


Number of Hires: 48

Percent of Hires: 9.9%

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