When Dutch entrepreneur Teun van den Dries started GeoPhy, an artificial intelligence (AI)-driven service that performs real estate valuations, there was nothing like it on the market. When he went to buy a house, Bloomberg reported, the appraiser he used simply asked him how much he thought it should cost.
That led him to realize the potential market for his company, which he started in 2014. On Thursday (Jan. 24), he announced that GeoPhy raised $33 million in a Series B funding round. The round was led by Index Ventures, which has backed companies like Deliveroo and Slack. Hearst Ventures and Inkef Capital also participated in the round.
“Essentially, in all other industries, there is no real equivalent where this much money trades hands with this little information,” van den Dries said.
GeoPhy works to calculate property values by gathering thousands of data points from satellites, sales info, property records, crime rates and even proximity to coffee shops. Currently, it focuses on commercial real estate, but intends to expand into the residential market soon.
What’s more, GeoPhy can help ratings services, financial institutions and companies like Fannie Mae to give a better picture of commercial properties, so they can offer better and more accurate lending models. Aaron Perlis, executive vice president and chief technology officer at commercial real estate finance company Walker & Dunlop, said the service is good because it’s objective.
“What we have now is a very subjective way to value and analyze property performance — you might catch an appraiser or head of acquisitions on a bad day,” Perlis said. “When you’re a lender, like we are, we want to try to understand the real value of a property, what’s the objective value that I can back up statistically.”
GeoPhy execs said the company’s service is less expensive and faster than a regular human appraisal, which can take 30 days and cost as much as $6,000.