Propy, a startup founded in 2017 that uses the Ethereum blockchain to streamline home-buying, announced Monday morning that it was one of two blockchain startups selected as part of Second Century Ventures’ 2019 Reach accelerator class. Second Century Ventures is the venture capitalist arm of the National Association of Realtors, which selects up to 10 new technology companies each year to enter its Reach program.
The terms of the investments were not disclosed, but the investment allows Propy and reConsortia to tap into the NAR’s network of 1.3 million real estate agents as they work to educate a larger audience about blockchain in real estate.
“You cannot buy real estate online as you do with books on Amazon. The reason for that is the lack of tools for online macro payments and online ownership transfer for high-value assets. Propy built both,” Propy CEO Natalia Karayaneva wrote in an email. “The record on the blockchain provides an additional level of security of home ownership for the future. The convenience of this technology is in the transparency of the entire process.”
By using smart contracts for transactions, Propy seeks to replace the need for a third party like escrow agents to process transactions, making the process faster and more immune to hacks. Karayaneva claims that Propy is the first real estate company to take blockchain technology global and wrote in an email to Forbes that it has listings in more than 30 countries. The startup projects that it will hit $4 million in annual recurring revenue by the end of 2019 in sales of SaaS products to developers and has raised most of its money to date through a $10 million initial coin offering (ICO) in 2017.
Second Century Ventures also included reConsortia, which tracks referrals using a blockchain, in the first group of companies in its 2019 Reach class that was announced in April among hundreds of applications to enter the program. The company helps log and organize referrals more cleanly and claims on its website that $20 billion worth of referral revenues in the U.S. are untracked.
With internet wire fraud causing more than $1 billion in losses in 2017 according to an FBI report, this is not the first year the NAR has shown an interest in blockchain startups. TrustStamp graduated from the accelerator in its 2016 class, and Notarize was part of the group a year later. TrustStamp uses facial biometric technology for identity verification to keep accounts secure in a range of industries including real estate, and Notarize makes collecting and legally notarizing documents more efficient.
“The goal of the Reach accelerator is to offer education, mentorship, industry exposure and key networking opportunities,” Ashley Stinton, senior marketing and communications director at Second Century Ventures, wrote in an email. “Blockchain can be an opportunity to drive efficiency and safety in various aspects of the real estate transaction through its ability to store and record data in an immutable fashion.”
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