Q&A - Jeremy Fand, SpaceKnow
Economist and entrepreneur discusses human mobility, built world economy and CRE
Jeremy Fand is both an economist and a predictor of trends. He was at Bloomberg when he saw an amazing portfolio company called SpaceKnow. He joined as CEO and now is looking at ten times revenue growth from last year, largely from being very good at doing space-based analytics. Fand and his team are moving beyond the data and algorithms of human mobility to model trends. Real World Graph asked Jeremy about what lies ahead for the built economy and CRE.
How have things changed for you and SpaceKnow since Covid-19 took hold? Has this experience led you to approach your work or the market differently?
How we look at the world and economics through space-based data is seeing a surge in demand. I spoke with the WSJ today and NYT last week. We are suddenly very topical! They want to see in real-time what is going on in the world and the economy and we can see the world from space. The business and approach to these times requires exceedingly nimble and creative management. That suits us because as a company, we are agile and flexible.
It is hard for engineers and PhDs to live in this world. They want to know what is next and work on science with no distractions. I am teaching my team we need to adapt.
I founded SpaceKnow through a hedge fund when I was on Wall Street. We sponsored the satellite manufacturing (SMI) index with Bloomberg money. The Bloomberg team added this industrial data to their terminals affording basic but powerful real-time metrics. It is still exceeding popular on the Bloomberg terminal.
What is the single greatest impact the Covid-19 pandemic is having on the commercial real estate markets you're watching?
We are doing a Now Cast! It’s real-time and we have the most watched economic index coming out of China. So people are very interested. Now we look at a million plus locations around the world. All sorts of analytics of the visible economy from space can be viewed.
In real estate, CRE is coming to us and trying to find opportunity. We cannot see inside a building but I can see traffic and movement trends. I see housing and building starts very clearly and can predict starts or completion.
The science of it all is really fun. We watch the life cycle of these buildings. From field clearing, to digging the hole, to starting the foundation. I can model each step of the building cycle by which trucks are coming and going. We do a lot of cell phone data work looking at human movement to help CRE execs. People also want to look at competitive market intelligence of what others are doing during the pandemic.
Which CRE jobs are still getting completed? What are the construction interruptions? Workforce estimation and knowing where people are and how many hours they are working is interesting data that our clients want. We think about the We Work problem and folks working from home . . . all these scenarios can be tracked and modelled. In vivid detail, I can look at real-time CRE occupancy. That has great value to the CRE industry.
Are there other impacts to the market that are being overlooked just now? Why?
Not everyone is focused on retail and that is a missed opportunity. What they have missed is the power of location data around retail and continued traffic. Unacast’s new product we helped build-out can measure how many people are staying home and when are they starting to leave home. Are we quarantined or are we starting to move back into the work world? I don’t have all the trends yet but I am not sure everyone is rushing to go back to Manhattan right now.
Talk about a deal that has been disrupted by Covid-19 . . . How terms changed, how the different parties were affected. Talk about innovative ways SpaceKnow is keeping the market engaged during physical distancing measures etc.
The pandemic has forced budgetary constraints across the majority of our clients. Yes we have success in the financial sector - they are still killing it even in the pandemic on the down side - but the data helps them. There are budgetary issues across all other verticals. The collapse means big oil guys are not paying hundreds of thousands of dollars for satellite data. We are still closing contracts with them but being more creative.
Exxon is not going out of business and they still have decisions to make. They still need to work a $16 billion infrastructure project and they will need our data to do it, the project is just postponed. We help them understand the global economy.
But the SpaceKnow business is no longer a start-up and not focused on one vertical.
We have been opportunistic and can go through our diverse product set because we have similarly scale-able science. We predicted the negative data coming out of Europe this week and the market saw a 20 to 50 percent decline in the European market. German PMI was down and we had guessed it right in the low 30s. We are flexible in the value offered.
Name a CRE investment market in America that stands to benefit in the wake of Covid-19 and/or pick a Proptech segment that is positioned for rapid growth and discuss the conditions that will create its success.
The world looks at a lot worse at the moment than the actual state of affairs. The big players are not going away. You cannot rely on a single vertical. You have to diversify right now! You can pick-up great talent right now and invest in the next thing.
Companies like We Work won’t be able to weather this storm because they devoted themselves to one single work concept. There is simply nowhere to go with all that dedication, advertising and foot traffic.
The big picture, those in the digital and data focused world see, is that moving forward and leaning-in to tech will win.
But don’t focus on just one vertical that could implode. Folks have built platforms that are brilliant but maybe the sector they pick is not ready for growth coming out of the Covid-19 Crisis. Let’s create lots of scale-able technologies across many verticals.
SpaceKnow empowers decision-makers with ultra large-scale planetary analysis. Our secret? A proprietary, AI-powered analytics engine, combined with the world’s most comprehensive collection of earth observation imagery.