Propel NYC VTS RXR Nick Romito Scott Rechler

Tech faces a 'period of carnage', but there will be opportunities to support companies set for long-term growth


Propel NYC | ‘Focus on quick wins in tech’ urge VTS and RXR

Pursue simple ideas that have a tangible and immediate impact on users rather than think about “big grand ideas”, speakers argued on the first day of Propel by MIPIM NYC.

A conversation between industry heavyweights Scott Rechler, CEO of developer RXR, and Nick Romito, CEO of VTS, delved into how real estate should approach tech strategies that transform operations.

Rechler argued that it takes “a change in culture” and buy-in from the entire organisation. But that partly depends on businesses ensuring that tech has an impact on customers – and fast.

“Focus on the quick wins that the end user can experience and embrace,” said Rechler. “If you have these big grand ideas [where] no one is really seeing the output and how it’s impacting their ability to operate, to serve our customers, they’re going to lose interest.”

Even if it isn’t perfect, the team will start embracing and refining the product, jumpstarting a process that embeds innovation in the business.

Romito echoed those thoughts, saying: “Find something simple to show your team a win, and the next one will be easier. They’ll be excited to be way more involved.”

Reminding the audience that using tech for tech’s sake is a mistake, Rechler later said: “Sometimes people get more focused on the digital, versus what are you trying to achieve?”

RXR’s starting point when thinking about tech is the “analogue side of the equation”: the company will test how well its teams can tackle a particular problem before considering investing in new tools.

What to do in a downturn

“It’s going to be a tough next year, but on the other side of that there’ll be some extraordinary times ahead,” Rechler said. From digital transformations to de-globalisation and the urgent need to respond to climate change, he forecast a period of growth the likes of which the US hasn’t seen since the post-World War II era.

Several speakers today referenced a similar idea. On another panel, head of Sidewalk Labs Prem Ramaswami argued that we’re living in a “hinge” period where we will see seismic shifts in how we work and live.

Despite the tumult, Rechler argued there is an opportunity to invest in companies that might struggle financially but are poised to reap long-term rewards if they get through this volatile period.

He gave RXR’s investment in smart glass company View as an example. View went public via a SPAC in 2020 and its share price tumbled to less than $1 per share. But with the Inflation Reduction Act introducing tax incentives that make the product increasingly competitive, RXR invested $200m to give it a path to profitability.

“There are companies with broken capital structures that are great companies that can do great things,” Rechler said. “If you could identify them, help them fix their capital structure, help them access customers… there’s significant potential.”

But, he warned: “There’s going to be a period of carnage before we get there.”

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