The CEO of Denzity, Darren Wong, tells us about his entrepreneurial journey and the decision to leave PropTech Institute—an organization he founded.
From launching food and beverage (F&B) startups in Canada to co-founding Denzity and PropTech Institute in Hong Kong, entrepreneur Darren Wong has traveled a long and winding road. One that has led him to finally leave PropTech Institute and take on more ecosystem building work at the Hong Kong PropTech Association (HKPTA).
He dubs Hong Kong the “Silicon Valley of Real Estate”, emphasizing the potential of PropTech in the region. Hearing him discuss his journey with PropTech is an exercise in curiosity. After all, he is ambitious, driven and eager to create change.
The path to PropTech
While running two F&B startups in Canada, Wong realized that it wasn’t the right field for him. “It wasn’t a strong calling,” he asserts. At the same time, many of his friends were working in real estate and really enjoying it. Intrigued, Wong began exploring the path and transitioned to the real estate industry.
The first step in his journey entailed moving to Hong Kong, where he began to learn about the industry by working at a commercial real estate fund. He helped institutional investors invest, and managed overseas properties, including residential, hospitality and commercial properties in Japan, the U.K. and other countries.
Launching PropTech startups
Upon gaining a deeper understanding of the real estate industry, Wong noticed that the winds of change in real estate were blowing. Investors were starting to rely heavily on the digitization of properties. That was paving the way for PropTech success. Wong defines PropTech as technology that “allows real estate businesses to have more creativity and innovation when it comes to their business model and impact the society at large.”
In keeping with the rise of PropTech, Wong launched two startups—PropTech Institute and Denzity. With his industry experience and appreciation for PropTech, he felt that he could help investors in a more impactful way by giving them the tools and knowledge required to make smart real estate investment decisions.
Wong admits that people didn’t take PropTech seriously in the past. That changed when Covid happened. He illustrates, “77% of investors prefer companies who have an online presence and offer expertise.” While there is a boom, it is not smooth-sailing.
The challenges a PropTech entrepreneur faces
According to Wong, the challenges are twofold: finding customers and designing the product. The business development or sales cycle “takes a long time and [involves] uncertainties. Some startups might not have the ability to survive the period of juggling between product development and attracting customers.”
In addition, stakeholders and real estate companies might be reluctant to adopt this technology. For that, PropTech startups need to design products that can complement the pre-existing workflow while creating value. Wong notes that the challenge there is that some clients might demand products exclusively designed for them, rendering them inapplicable to other companies. As a result, the product might not be scalable. He also believes that, “Startups require a lot of funding to compete with legacy tech or technology that a company would rather have in-house [departments] make.”
Despite being a real estate hub, Wong feels that Hong Kong falls short of encouraging PropTech and fails to draw the attention of real estate stakeholders to this industry. Although Hong Kong is one of the major marketplace for funding in the world, “there is insufficient allocation towards PropTech startups in the most critical early stages.”
Welcoming the tides of change
Despite the challenges, top real estate companies are willing to try out PropTech. Wong reveals, “More than 80% of real estate companies [have] increased their digital marketing budget by 50%. And, from our research, around 150 out of 3,888 real estate companies in Hong Kong had an online presence by the summer of 2021, and it is growing as we speak.” A lot of real estate companies are digitizing right now, and many of them are enlisting the assistance of PropTech startups to do so.
Moving on from PropTech Institute
“It’s a tough decision to step down as the chairman of PropTech Institute, as the non-profit was founded with a group of close friends that believe in the same cause,” divulges Wong. He built PropTech Institute, creating an inclusive platform for people to connect with technology and the larger real estate community.
“The reason why I left is that things are changing for Denzity, and the company needs more of my time and effort to grow optimally. At the same time, I’d like to continue contributing to the PropTech ecosystem. The Hong Kong PropTech Association (HKPTA) has a lot of leaders whom I’d like to learn from and work alongside. What excites me is that I can share the content capability and workflow that my team at Denzity has formulated over the years and share it with the HKPTA team,” he explains.
In the end, for Wong, moving on from PropTech Institute is about accessing newer opportunities and gaining a global perspective on the PropTech business.
A word of advice for future PropTech leaders
Wong states, “You have to deep-dive into this industry to spot opportunities and stray from the trodden path. Real estate professionals value creativity and innovation; but, you must bear in mind how to integrate your solutions to their workflow.” A PropTech entrepreneur must learn to create pitches that clients cannot refuse.
Additionally, Wong encourages seeking feedback from companies first and focusing on making profits later. If you try and get companies on board and allow them to contribute to your idea, then “they would not mind opening their pocket a bit more afterwards.” That said, it’s also important to take a stand for your idea. “At the end of the day, a good startup founder has good ethics and morals, and their product is meant for a greater world,” he notes.
To understand how the industry works at large, you will also need to find leaders, advisors, mentors and experts with the relevant experience and wisdom to guide you.
In the real estate industry, you are directly impacting people of all and sundry. They use your product in their everyday lives—for working, enjoying and more. Unquestionably, they need to be at the heart of your company’s growth.
Image courtesy of Denzity