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Fifth Wall (firm)

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Fifth Wall is a venture capital firm founded in 2016 by Brendan F. Wallace and Brad Greiwe.[1][2][3] It manages the largest fund specialized in real estate technology [4][5] The firm's name refers to a fifth wall of technology it provides in addition to the four physical walls of a building.[6] It is part of an emerging category of "PropTech" investors.[4] Major financial backers include large real estate industry companies that agree to be matched with the products and services of the firm's portfolio of start-up companies.[7] The firm has separate funds for investments in emerging retail brands and climate technology to help real-estate companies reduce carbon emissions from their buildings.[8][9]

Fifth Wall
Company typeLimited Partnership
IndustryVenture Capital
Founded2016
HeadquartersLos Angeles, California, U.S.
Key people
Brad Greiwe, Brendan F. Wallace
Websitefifthwall.com

Founders

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The firm was founded by Brad Greiwe and Brendan Wallace[9] Greiwe co-founded single-family home rental company Invitation Homes, which went public in 2017 with a $6.7 billion valuation; it received much mainstream attention for its business practices.[10][11]

Wallace graduated from Princeton University with a bachelor's degree in political science and economics in 2004, and received his MBA from the Stanford Graduate School of Business in 2010. He started his career as a real estate analyst at Goldman Sachs and worked for The Blackstone Group's real estate division. He founded Identified, a workforce optimization data and analytics company, which was acquired by Workday, Inc. in 2014.[12] Wallace also co-founded Cabify, a ridesharing service in Latin America, in 2012.[13] Wallace has led investments in Lyft, SpaceX, Dollar Shave Club, Bonobos, Philz Coffee, and TriNet Zenefits. He was included on the LA500 list of the most influential business executives in 2021.[14]

History

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Fifth Wall was formed in 2016 and announced the close of its $212 million real estate technology fund (Fund I) in May 2017.[15][16] Wallace said that the firm identified real estate technology as an underserved investment niche because the industry has traditionally used very little technology and was therefore open to disruption.[17]

In July 2019, the firm announced the close of its second real estate technology fund, or Fund II, which closed at $503 million. While Fund I was raised from nine investors in the US only; Fund II consisted of a global investor base from over 50 investors from 11 countries.[18] The fund's investors included CBRE Group, Cushman & Wakefield, Equity Residential, Gecina, Merlin Properties, Mitsubishi Estate, British Land, Prologis and Segro.[5] Fund II invested in a number of companies, but was focused on business-to-business enterprises such as the California-based Cobalt Robotics.[19]

As of February 2020, the firm managed over $1.1 billion in assets.[20][21] In 2021, Fifth Wall announced that it had raised more than $1.1 billion[22] across its funds and had a global investor base of over 90 investors.[23] In addition, several large real estate investors announced their investments into the firm's Climate Tech Fund, including Equity Residential, Hudson Pacific Properties, Invitation Homes, and Ivanhoé Cambridge.[24] "Real estate is kind of this massive industry when it comes to climate change, but at the same time we haven't seen the industry commit a significant amount of capital to the tech that's required to decarbonize it," Wallace said.[24]

In 2022, Fifth Wall announced its inaugural "Climate Tech Fund,"[25] a sustainability venture fund investing in technologies that would decarbonize the real estate industry, which drives an estimated 39% of global emissions.[26] The fund is focused on technologies related to energy efficiency, water reuse, decarbonization, climate resilience and risk management.[27] The firm closed its climate fund with $500 million in commitments to invest in companies which decarbonize the real estate industry. This fund brought the firm's assets under management to over $3.2 billion.[20] The firm's limited partners include Camden Property Trust, Hilton, Host Hotels & Resorts, Marriott, Koch Industries, Starwood Capital Group, Lowe's and MGM Resorts International.[28][29]

Investments

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Fifth Wall's portfolio companies include Blend, ClassPass, Clutter, Doma[30] (FKA States Title), Hippo, Homebound, Industrious, Lime, Opendoor, Procore, SmartRent and VTS.[31] The firm has also invested in Allbirds, Carbon38, Cotopaxi, Foxtrot, Heyday, Interior Define, Madison Reed, Taft and Untuckit.[32] The firm's climate fund has invested in companies such as Turntide Technologies, Assembly OSM, Brimstone, Clarity AI, ICON, Sealed, SPAN, and Wildcat Discovery Technologies.[33]

References

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  1. ^ Sharf, Samantha. "New $212M Venture Fund Goes All In On Real Estate--Can An Innovative Model Force Change In A Dusty Industry?". Forbes. Retrieved 2017-10-31.
  2. ^ "The nation's biggest real estate companies are trusting two men in Venice to find them the next Airbnb or WeWork". Los Angeles Times. 28 April 2017. ISSN 0458-3035. Retrieved 2017-10-31.
  3. ^ Lee, Georgina (2018-08-27). "US proptech fund Fifth Wall attracts Hong Kong, Asian interest". South China Morning Post. Retrieved 2018-10-18.
  4. ^ a b Putzier, Conrad (2018-08-01). "Who's holding the purse strings?". The Real Deal New York. Retrieved 2018-11-14.
  5. ^ a b Marinova, Polina (2018-07-25). "Why VC Firm Fifth Wall Ventures Is Bullish on the Tokenization of Real Estate". Fortune. Retrieved 2018-10-18.
  6. ^ "Fifth Wall Ventures raises $212 million fund to invest in real estate | VentureBeat". venturebeat.com. 2 May 2017. Retrieved 2017-10-31.
  7. ^ "Fifth Wall raising another $200M for retail tech startups". The Real Deal New York. 2018-05-24. Retrieved 2018-06-06.
  8. ^ "Fifth Wall adds new partner as it seeks at least $200 million for a new climate impact fund". TechCrunch. 15 December 2020. Retrieved 2022-01-22.
  9. ^ a b Zakrzewski, Cat (2018-08-28). "'Retail Real Estate Isn't Dying,'\' Says Fifth Wall Ventures". Wall Street Journal. ISSN 0099-9660. Retrieved 2018-10-18.
  10. ^ Loizos, Connie. "A new venture firm focused on real estate has raised $212 million from real estate industry giants". TechCrunch. Retrieved 2017-10-31.
  11. ^ Conlin, Michelle (27 July 2018). "Spiders, sewage, fees – the other side of renting from Wall Street". Reuters. Retrieved 2021-02-06.
  12. ^ "What to Know About Emma Watson's New Businessman Beau Brendan Wallace". Peoplemag. Retrieved 2022-10-01.
  13. ^ "VC firm Fifth Wall raises $212M real estate tech fund from CBRE, EQR, others". The Real Deal New York. 2017-05-02. Retrieved 2017-10-31.
  14. ^ "BRENDAN WALLACE". Los Angeles Business Journal. 2019-05-19. Retrieved 2022-10-01.
  15. ^ "Fifth Wall Ventures Raises $20M, Led by Identified's Founder". Wall Street Journal. 2016-09-30. ISSN 0099-9660. Retrieved 2017-10-31.
  16. ^ "Fifth Wall Ventures raises $212 million fund to invest in real estate". VentureBeat. 2017-05-02. Retrieved 2021-01-30.
  17. ^ Morris, Meghan (2018-09-11). "Fifth Wall: Meet the venture capitalists funding the future of real estate | PERE". PERE. Retrieved 2018-10-18.
  18. ^ "Fifth Wall raises $503 million from property owners seeking tech edge". Reuters. 2019-07-17. Retrieved 2022-10-01.
  19. ^ "Fifth Wall Raises Largest Real Estate Venture Fund to Date". Fortune. Retrieved 2022-10-08.
  20. ^ a b "US venture firm Fifth Wall's US$500 million green fund eyes start-ups with sustainable solutions for real estate sector". South China Morning Post. February 10, 2020.
  21. ^ "This 31-Year-Old Venture Capitalist Has Bet $12 Million On Real Estate And Diversity". Forbes. July 30, 2020.
  22. ^ "Fifth Wall raised a whopping $1.1B in 2021". FinLedger. 2022-01-04. Retrieved 2022-01-22.
  23. ^ "Fifth Wall raised a whopping $1.1B in 2021". FinLedger. 2022-01-04. Retrieved 2022-01-22.
  24. ^ a b Freedman, Andrew (20 September 2021). "First look: Real estate firms invest $140 million in climate tech". Axios. Retrieved 21 January 2022.
  25. ^ "Fifth Wall Announces New Climate Tech Fund Has Reached $140 Million From New Backers". Startupsavant.com. Retrieved 2022-01-22.
  26. ^ "Fifth Wall Closes Half-Billion Dollar Fund to Decarbonize Real Estate". dot.LA. 2022-07-22. Retrieved 2022-10-06.
  27. ^ "Fifth Wall Ventures Preps Real Estate Sustainability Fund". The Wall Street Journal. January 14, 2020.
  28. ^ Olick, Diana (21 July 2022). "Fifth Wall closes half-billion-dollar climate fund to decarbonize global real estate". CNBC. Retrieved 2022-10-01.
  29. ^ Konrad, Alex. "Amid Flurry Of SPACs, Prop Tech VC Firm Fifth Wall Turns To Wall Street For New Partner". Forbes. Retrieved 2022-10-01.
  30. ^ "Doma, Hippo, Homebound, Fifth Wall Founders on Residential Proptech". The Real Deal New York. 2021-06-11. Retrieved 2022-01-22.
  31. ^ "Fifth Wall raises $503 million from property owners seeking tech edge". Reuters. July 17, 2019.
  32. ^ "As Digital Brands Realize They Need Stores, Fifth Wall Ventures Sees An Opportunity". Forbes. February 26, 2020.
  33. ^ Lash, Herbert (2022-07-21). "EXCLUSIVE Fifth Wall climate fund aims to decarbonize property industry". Reuters. Retrieved 2022-10-06.
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