After the experiencing its worst quarter since 2018 at the start of the pandemic, the rent tech space showed signs of recovery in the third quarter. RET Ventures tracks the market activity, and recently produced its first quarterly data report on the space. The report unearthed three major trends dominating the rent tech space, starting with a renewed interest in early-stage deals.

In the second quarter, there were only 23 early-stage deals, making for the worst quarter in the rent tech space since 2018, when RET Ventures began tracking data. In the third quarter, activity rebounded, illustrating market resilience. RET Ventures attributes the turnaround to increased adoption of technology through the pandemic. Technology helped operators maintain business operations safely while adhering to social distancing guidelines. As a result, there was a renewed interest in proptech investment.

Although rent tech funding for early stage companies improved in the third quarter, the number of early stage deals continued to decline. This may be unrelated to the pandemic though as rent tech early stage funding peaked in early 2019. This is not due to a lack of demand but rather increased scrutiny on the side of investors, illustrated by the strong dollar amount of real estate and VC tech investment. As the real estate tech market has matured, funding has started to funnel toward late-stage companies. However, RET Ventures suggests that the pandemic could push more capital into the tech space, providing opportunities for both early and late stage companies.