Buying real estate by the 2021 standards

Having entrepreneurs is energizing. They are a constant reminder that mindset is the most often sole differentiator between imagination and reality.

I enjoy meeting entrepreneurial lawyers doubly so. Although by the dry definition, law firm partners are business owners or managers, still quite a lot of them take the path made by their predecessors. As they “inherit” the business, they might opt to stay in their lane.

And then there are others, like Thomas Seeber of Kunz Wallentin law (Austria), who take a good look at the next five to ten years, wondering how to disrupt their own business before anyone else.

This is a short conversation about Thomas’s brainchild - REALEST8 - the platform making trading real estate much more comfortable.

Why REALEST8?

Q: What problem did you spot early on that made you start with this REALEST8?

Thomas Seeber: Doing real estate transactions can be a bureaucratic nightmare: notary acts, financing discussions with banks, signing contracts – all require physical presence. And while this may be an inconvenience for you and me, the physical presence is much more than that for people with visual or other corporal impairments. To them, this is often an insurmountable obstacle to executing their transactions. 

Since I also grew curious about Legal Tech as soon as it became "a thing," I had the idea of combining the two.

Q: How does REALEST8 solve that problem?

TS: Realest8 Technologies was founded in 2018 to eliminate the "regular" analog transactions. Everything is executed digitally: from finding the perfect real estate to contacting the seller and contract negotiations, signing all relevant contracts – including financing and security provision – and calculating and paying the necessary taxes. We work together with the Austrian Federal Computing Centre, which supports our contract management tool. With the block stamper's help, you can easily verify the content and time of received digital documents (e.g., verification of the inbound purchase offer).

Identifying the problem and audience

Q: How did you run into that problem in the first place? And how did you validate it (i.e., determine it was a problem worth solving)?

TS: Luckily, in my case, I didn't have to do much validation. (chuckles) It's common knowledge that regular real estate transactions are a pain. Challenging, however, was to execute everything digitally. Since we were the first start-up in Austria to facilitate real estate transactions digitally, there was no prior knowledge pool to tap in.

Although there were some examples in other jurisdictions, they weren't always helpful as Austria can be quite different regarding real estate transactions, financing, and collaterals. Therefore, we did not have any blueprints we could use; we had to draw everything up from scratch.

I wasn't a tech expert at that time but luckily had (very talented) IT contacts. Developing a legal tech tool is never an easy feat, and we had many hurdles to overcome along the way.

Q: How did you define your primary target audience?

TS: To me, it was always quite clear - everybody selling, purchasing, or financing real estate – be it commercial or private. We currently have a cooperation with a prominent Austrian property developer, which extends our potential user base.

From a sideshow to the main stage

Q: Speaking of innovation - what does it mean to you? How do you ensure the design you implement is impactful and don't end up shelved (e.g., product or feature)?

TS: To me, innovation is providing a significant, unique, efficient product with real-life use. In my view, our platform is exactly that - a tool that could change an entire business sector and will therefore have a significant impact.

We are currently the only comparable product on the Austrian market; you could say we are quite innovative (chuckles).

Q: How do you see legal tech nowadays? And what about the business of law? How did those concepts change over time?

TS: Legal Tech has turned from a sideshow to the main stage: it is all but trivial or unnecessary. Lawyers used to say there will never be room for AI in the law sector; we see now that machine learning and AI can easily replace many services provided by lawyers. 

However, I don't see lawyers vanishing entirely. Instead, they have to adapt to the new situation and learn how to use legal tech, not work against it.

For example, lawyers can still consult and work for the seller, purchaser, or financer through our platform's negotiation tool. Their work won't differ much from "regular" transactions: very experienced property developers may not use lawyers for standard transactions. However, if someone contracts a lawyer through Realest8, they will have to grapple with the new platform or risk losing relevance in this day and age.

Founders (from top left):
Dr. Thomas Seeber, Lena Brunner, BA, Emmanuel Ruez, BSc

Early days of legal service productization

Q: From your seat, do you see legal service productization as a relevant trend? 

TS: Absolutely, and in my opinion, we are currently just at the start of this trend. In the US, they are already apps that generate contracts and solve (simple) legal problems.

We will probably see pretty much every legal service delivered as a (legal tech) product in the upcoming few years. It will continue to be relevant for lawyers to work with these tools, provide individual client care, and solve complex issues.

We are, e.g., continually using a Data room or Due Diligence tools like Drooms or Luminance. Machine learning algorithms make the due diligence process faster, more efficient, and less prone to mistakes. These tools already reinvented the legal service business, in my view. A few years ago, M&A-lawyers had to sit in small rooms for days and review files provided by the respective companies; lawyers can now do this digitally. A due diligence tool can speed up the process and highlight areas that might require more attention.

Q: (How) does REALEST8 tie in with productizing legal services? Do you have any examples from your business?

TS: I see Realest8 as an excellent example of this since it ties in every step from the traditional real estate process and combines it within one platform. The tax tool also solves this highly complex step.

However, it does not replace the legal service "contract negotiation." Users have to do this on their own through the negotiation tool or contact a lawyer who would use this tool for them just like in real life.

Change as the driving force 

Q: Any reading suggestions for those that would like to sharpen their entrepreneurial mind?

TS: Yeah, I would recommend the Shoe Dog by Phil Knight, where the Nike founder shares his autobiography, which is, in my opinion, incredibly inspiring. Funnily enough, Nike used to be what we would now consider a "start-up." The author does not shy away from exposing all his setbacks, which I find very important as an entrepreneur.

Q: (getting a bit personal) What drove/is driving you into this venture? Was anything wrong with merely stacking billable hours?

TS: Since I was and still am a lawyer for real estate law, corporate law, banking & finance, I am delighted with still doing this work. However, as I have mentioned, the legal industry is constantly changing. With the digitalization pace nowadays, we have to expect a massive change to our industry pretty much every day. We are experiencing this.

While there are still active lawyers who had to learn how to use a computer properly, my team and I always wanted to stay ahead of the curve and continue to be competitive in 10 years.

It is now not enough to have experience, drive, and talent – one has to be creative, innovative, and obtain tech skills. It cannot happen that the businesses we provide our services to are predominantly digital, yet we are barely using the MS Office suite. Therefore, it was essential to me to create a novel and innovative product that will help set apart our firm also in the future.

What’s coming next?

Q: So where do you think this all leads? The legal industry matured, but now it seems to be at the cusp of reinvention?

TS: Yes, I agree. I feel like the legal industry may be a step behind every other industry. I think this has to change and is slowly changing. Lawyers who did not want to use legal tech are either adapting or becoming more irrelevant; therefore, it becomes essential to "reinvent" oneself. The businesses we support do not want lawyers that lag behind with digital transformation.

One can set themselves apart in showing that they are not afraid of this new era because they do not think they can be "replaced" by legal tech and AI, but rather work with this legal tech to become better and more efficient.

Photo by Jason Dent on Unsplash