South African prop-tech startup Flow is reporting impressive growth figures as it prepares to take on board further investment to supercharge its development.
Founded by Daniel Levy and Gil Sperling, Flow goes straight to the source of the largest social platforms in the world – Facebook, Instagram and LinkedIn – to match people with property.
“Our technology creates dynamic ads and automated listings at a scale otherwise impossible for estate agents and developers to do. We wanted to incorporate speed and efficiency into the way that people find property to ensure prospective buyers and tenants view relevant, personalised content and listings to match them with the right, tech-savvy agents and developers who are experts in those chosen areas,” Levy told Disrupt Africa.
Levy and Sperling were previously part of the founding team at Popimedia, one of Africa’s biggest ad-tech and performance marketing companies.
“At the time, Popimedia were the largest buyers of Facebook media inventory in Africa, representing some of the world’s biggest brands. When the company was acquired by global communications group Publicis, we set our sights on the property industry, keen to use the business and technology experience we’d gained to change the way people find places to live and work,” said Levy.
Disrupt Africa reported in January 2019 the startup raised a ZAR20 million (US$1.47 million) funding round from Kalon Venture Partners and CRE Venture Capital, with the platform launching to the public the next month.
“The way the property market works in South Africa hasn’t changed in decades – it’s pretty archaic and doesn’t make use of the hyper-connected world that digital natives, i.e. most people, are used to,” Levy said.
“There are 23 million South Africans currently on Facebook and Instagram, and eight million on LinkedIn. For agents and developers not to be taking advantage of that audience seemed crazy to us. There are existing online platforms like Property24 which do have significant traffic, but we wanted to create a tool that connects both sides of the market more effectively, at scale and automatically allowing agents and developers to focus on doing deals.”
Flow has done just that, with the founding team seeing an opportunity to harness behavioural data about how buyers and tenants go about their search process.
“There’s not a lot of this data at present, and we identified a wide gap in the market for a tool that can generate insights and create positive change. By this I mean not just how property is marketed, but also what buyers want, how tenants are impacted by price, where there are surges of demand, how many properties do people look at, what additional products are useful during the buying process – the list goes on,” said Levy.
Flow has seen strong growth.
“Although we had confidence in our technology and strategy before launch, using social media to sell and rent property is a totally new concept here. The results so far have been fantastic, with 30 per cent month-on-month growth, and based on our proprietary data we’ve seen 10x growth in property-related social spend during the last 12 months and expect that trend to continue,” said Levy.
Indeed, some agents are now relying on Flow for around 90 per cent of their leads.
“It’s that stickiness that has really encouraged us as we prepare for the next phase of growth. To put it into context, nine million South African buyers and tenants have been reached about agency brands and property listings via Flow in the past year. That is 40 per cent of all Facebook and Instagram users in the country,” Levy said.
With that next phase of growth in mind, Flow – which in 2020 topped up its funding pot with further investment from Kalon Venture Partners and Vunani Capital – is planning on raising another round of funding soon. The plan is to continue to grow at home while starting to look abroad too.
“We are focused on consolidating the super fast growth we’ve witnessed over the last 12 months. Over 4,000 agents are now finding prospective tenants and buyers through our Flowfuel product, usually direct to their WhatsApp, which equates to about 10 per cent of the country’s agents. Looking further afield, Sub-Saharan Africa is obviously an area we’d like to move into, and we’ve also about to test a few campaigns in markets like Australia and Israel,” Levy said.
“Alongside geographic expansion, our long-term goal is to connect the entire property ecosystem. Searching for a property is only one component of a move. We have plugged in products such as home insurance, contents insurance, mortgage origination, deposit loan solutions, furniture sourcing, appliance maintenance and legal services. It’s an exciting journey as we design a tool that fundamentally eases the process for a new buyer or tenant.”
Flow’s primary source of revenue comes from estate agents, developers and its marketplace partners, with its fee a percentage of the media spend that is deployed on the social channels it uses.
“Looking ahead, there are areas we can tap into alongside partners that will boost our ability to invest in our product and roll out some of the features we have in our roadmap,” Levy said.
