South African prop-tech venture building group Castle One has received a “significant investment” from HL Hall and Sons Holdings in a deal it says will unlock new, synergistic value for the benefit of the real estate industry, both locally and abroad.
Founded by tech entrepreneurs Jonothan Rawson and Mark Forrester, Castle One has been active in the emergent prop-tech space since 2018.
The venture-building group is currently invested in three local prop-tech ventures, namely digital marketing and business platform for real estate Prop Data, rental payments and portfolio automation platform reOS, and Ekaya, which provides prospective tenants with a single profile to help landlords and property professionals.
Halls is a 130-year-old family-owned business, with local and international holdings across several sectors – from data and analytics to property investment and pharmaceuticals. According to Rawson, the investment by Halls into Castle One will enable the group to accelerate its innovation journey, while extending its presence in foreign markets.
Although the prop-tech space in South Africa has attracted substantial attention in recent years, Rawson notes that startups have tended to struggle – even when they have had something special to offer.
“This is largely due to the size of the formal South African property market, when compared to markets like the US, but also the multi-faceted nuances of the real estate business itself, which newcomers to the industry tend to underestimate,” he said.
According to Rawson, the industry’s unique dynamics present a number of “invisible barriers to innovation”. Castle One’s venture-building model, which involves investing in and building new products and ventures, while creating synergies and network effects, looks to address this challenge. The uniqueness of its model has attracted investment from various role-players in recent years, culminating in the recent transaction with Halls.
“Our investment into Castle One is tremendously exciting as our companies have strong shared values and a common vision for how technology can benefit the real estate sector,” said Halls chief executive officer (CEO) Pete Backwell.