Europe’s real estate industry faces persistent challenges: slow digital adoption, rising construction costs, heavy reliance on manual workflows, inefficient property operations, lack of real-time data, and mounting pressure to meet strict ESG and energy-efficiency standards. Many landlords, asset managers, and developers still operate with outdated systems, disconnected spreadsheets, and legacy tools that make it difficult to control costs, reduce emissions, or improve tenant experience. These structural inefficiencies create major gaps across transactions, facility management, leasing, due diligence, and portfolio analytics.
Proptech exists to solve these real estate problems
By combining real estate with advanced software, IoT sensors, automation, AI-powered analytics, and digital transaction tools, proptech startups help owners and operators modernize faster and more efficiently. They deliver energy savings, streamline building operations, enable predictive maintenance, improve leasing conversion, reduce vacancy, accelerate construction timelines, and give investors the transparent data they increasingly require.
To achieve this growth, European proptech startups typically combine multiple funding sources—angel investors, seed VCs, corporate strategic investors, venture debt, and project-specific SPVs. This diversified financing strategy supports both software development and asset-light deployment models, allowing startups to scale across markets such as Germany, France, Spain, the Nordics (Norway, Sweden), and the UK, where digital transformation in real estate is accelerating.
How Proptech Startups and Investors Use Luxembourg Investment Companies
Proptech founders and real-estate investors increasingly rely on Luxembourg structures because they provide flexibility, tax neutrality for cross-border investment, and a stable regulatory environment. As European proptech models scale across multiple countries, Luxembourg becomes a natural hub to centralize capital, intellectual property, and SPV-based real-asset operations.
Here’s how the ecosystem typically leverages Luxembourg vehicles:
1. SOPARFI for holding equity and cap-table consolidation
A SOPARFI acts as a tax-efficient holding company for shares in the operating business.
- Founders’ equity
- VC shareholdings
- Employee stock option plans
- IP ownership or licensing
- Future acquisition targets
For international VCs investing across France, Germany, Spain, the UK, and the Nordics, a SOPARFI simplifies governance and dividends through participation-exemption rules.
2. SCSp / SLP for venture capital and proptech-focused funds
European and US investors frequently structure VC or growth-equity funds through the SCSp / SLP, a flexible limited partnership without legal personality.
- Proptech-focused VC funds
- Real-estate innovation funds
- Corporate venture units of developers or facility-management groups
- Multi-LP European investment clubs
It aligns with common-law LP structures, making onboarding foreign investors fast and familiar.
3. RAIF for scalable multi-strategy proptech investment platforms
Proptech models often combine technology with real-asset exposure, such as:
- Smart-building retrofits
- Sensors and IoT infrastructure
- Efficiency upgrades
- Modular or prefabricated construction projects
- Energy-saving performance contracts (ESPCs)
A Reserved Alternative Investment Fund (RAIF) allows investors to launch a regulated-like fund quickly, using any approved strategy (private equity, private debt, infrastructure, real estate).
- Raise institutional capital
- Finance long-term installation programs
- Create recurring revenue linked to building performance
- Deploy asset-light hardware at scale
4. Securitization Vehicles (SVs) for recurring revenues and performance contracts
Many proptech models generate predictable, long-term cash flows, such as:
- Energy savings
- Equipment leasing
- Subscription revenues tied to building contracts
- Hardware-as-a-service (HaaS)
- Facility-management automation outputs
A Luxembourg Securitization Vehicle can package these cash flows into compartments that issue notes to investors—ideal for:
- Monetizing recurring revenue
- Reducing equity dilution
- Funding equipment rollouts across many buildings
- Creating investment-grade product lines for family offices and debt funds
5. Real-estate SPVs for cross-border project deployment
Proptech solutions tied to physical assets (e.g., sensors, heat pumps, automation equipment, solar tech, digital meters) often need project SPVs to manage installation contracts and onsite operations.
- Fit multi-country deployment
- Offer flexible debt financing
- Are compatible with bankable PPP and retrofit models
- Allow compartmentalization for each building or client portfolio
6. Why Luxembourg is attractive for proptech capital
- Predictable tax environment
- Fast fund setup (especially RAIF and SCSp)
- Global LP familiarity
- Strong legal certainty
- Access to EU passporting when relevant
- Clear governance standards
- Efficient structuring for multinational expansion
This makes Luxembourg one of the few jurisdictions where VC, PE, corporate investors, and property owners can collaborate under one centralized investment platform.
Know more about Luxembourg companies
- Guide to Register Your Company in Luxembourg
- Step-by-Step Guide on How to Start a Business in Luxembourg
- Guide of Luxembourg Reserved Alternative Investment Fund
- Guide about Luxembourg Securitization
- Guide SOPARFI Luxembourg Financial Holding Company
What fundraising routes do proptech founders actually use?
Founders mix several instruments as they scale. Below is a clear map of options, plus when each shines. As you read, think about your sales cycle, hardware needs (if any), and proof points.
Which funding types fit different stages?
Here’s a friendly overview you can use in investor conversations. After each option, we add a short transition so you see where it leads next.
- Bootstrapping & customer prepayments: Ideal before outside capital. It proves discipline and product-market signal. Then, convert early buyers into references.
- Grants and innovation programs: Helpful for pilots and R&D. Once validated, you can leverage the results into matched private capital.
- Incubators & accelerators: Provide network, mentors, and small tickets for speed. Use the program to tighten your metrics for the next round.
- Angels & operator syndicates: Great at pre-seed and seed. Their intros to landlords and facility managers shorten your sales motion.
- Equity crowdfunding: Useful for community-driven products. Afterward, keep cap-table hygiene for institutional follow-on.
- Seed and Series A venture capital: Fuels hiring, integrations, and go-to-market. Treat metrics like unit economics and payback as your north star.
- Corporate venture & strategic partners: Real-estate owners, construction firms, and facility operators bring distribution. Align pilots and procurement upfront.
- Revenue-based financing (RBF): Works for recurring SaaS tied to usage. Combine with equity to avoid growth bottlenecks.
- Venture debt: Extends runway post-equity round. Keep covenants simple and line up clear use of proceeds.
- Asset-backed or equipment facilities: If you deploy sensors or gateways, ring-fence hardware in a finance SPV. Let the core company stay capital-light.
- Project SPVs & co-investment: For retrofit or shared-savings models, raise per-project capital and keep equity dilution low.
- Convertible notes and SAFEs: Speed pre-priced rounds. Set rational caps to keep room for later equity.
What do investors want to see from proptech teams?
They want proof that your product saves time or money for owners. Keep it tangible: energy savings, fewer service calls, faster turnarounds, or better tenant experience. Then, show integrations with common tools and a path to multi-building rollouts.
What does a simple data room include?
| Section | What to include | Why it matters |
|---|---|---|
| Traction | MRR, pilots, churn, ACV, retention | Signals repeatability and buyer value |
| Product | Architecture, roadmap, integrations | Reduces technical risk |
| Commercial | Pricing, payback, pipeline by stage | Clarifies growth levers |
| Compliance | Data privacy, ESG, building standards | Unlocks enterprise buyers |
| Finance | P&L, runway, cap table | Keeps rounds smooth |
Who invests in proptech across Europe?
Sector VCs, climate tech funds, corporate real-estate investors, and family offices are active. Warm intros through landlords still unlock the fastest meetings and pilots.
Helpful resources and next steps
- How to pitch your startup for Series A–C
- Latest insights on structuring and funding
- Setting up a holding or SPF: practical steps
- Private debt solutions for refinancing a Single Hotel Asset or a Hotel Portfolio
Damalion supports Proptech startups with proprietary technologies and wishing to grow on a global scale. Please contact your Damalion expert now.
FAQs: fundraising for proptech startups
1) Which funding type is best at pre-seed?
Angels, accelerators, and small grants work best while you prove the first pilots.
2) What do seed investors expect?
Clear payback for owners, repeatable sales, and integrations that reduce friction.
3) Should I use a SAFE or a priced round?
Use a SAFE for speed; switch to priced equity when metrics support valuation.
4) When does venture debt make sense?
After a seed or Series A when you have steady revenue and want to extend runway.
5) Can I finance sensors without heavy dilution?
Yes, consider asset-backed facilities or a project SPV tied to deployment cash flows.
6) How do I win corporate strategics?
Offer pilots with clear KPIs and a route to procurement and portfolio rollout.
7) Is equity crowdfunding viable for proptech?
It can work for community-centric products if you maintain cap-table hygiene.
8) What KPIs matter most?
Energy savings, ticket time reduction, retention, ACV growth, and payback period.
9) How long should I plan for a seed raise?
Six to ten weeks from first meeting to close if your data room is ready.
10) Do family offices invest in proptech?
Many do, especially when solutions improve their own portfolios.
11) What derails a round?
Messy cap tables, unclear compliance, or weak references from early pilots.
12) Can grants fund commercial work?
They help with pilots and R&D; pair them with private capital for scale.
13) How big are European seed tickets?
Often €0.5m–€2m depending on traction and pipeline quality.
14) Do I need a banker for seed?
Usually not; founders, angels, and sector funds can close it directly.
15) What belongs in my one-pager?
Problem, solution, metrics, team, pilot proof, and the ask with use of proceeds.
This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor | External links are ownership of their respective owners and do not imply any economic link or interest with Damalion corporation.
GREAT EUROPE PROPTECH COMPANIES
| Startup | Country | Focus | Key Investors |
|---|---|---|---|
| Deepki | France | ESG & decarbonization data | Highland Europe, One Peak, Bpifrance, Revaia |
| PlanRadar | Austria | Construction & workflow software | Insight Partners, Quadrille Capital, Headline |
| Plentific | United Kingdom | Property operations platform | Highland Europe, Brookfield, Target Global |
| Infogrid | United Kingdom | Smart-building IoT & analytics | Northzone, The Venture Collective, JLL Spark |
| WeMaintain | France | Maintenance tech (lifts, doors, fire systems) | Red Alpaca Capital, Eurazeo, Raise Ventures |
| Shayp | Belgium | Water-efficiency & leak detection | Serena Capital, Asterion Ventures, AMAVI Capital |
| Habyt | Germany | Flexible living & co-living | Sequoia Capital, Burda Principal Investments, HV Capital |
| Clikalia | Spain | Residential transactions | SoftBank, Fifth Wall, Luxor Capital |
| Spaceti | Czech Republic | Smart-office & workplace analytics | — Not publicly disclosed |
| Sensorfact | Netherlands | Energy monitoring & insights | Blume Equity, SET Ventures, Korys, FORWARD.one |
Glossary Terms: Proptech
| Term | Definition |
|---|---|
| Proptech | Technology that enhances real-estate operations, transactions, maintenance, and asset performance through software, automation, and data. |
| Smart Building | A building with sensors, automation, and analytics optimizing HVAC, lighting, security, and energy in real time. |
| IoT (Internet of Things) | Connected on-site devices—meters, sensors, controllers—capturing and transmitting operational data. |
| Digital Twin | A real-time, data-synced virtual model of a building for simulation, fault detection, and lifecycle planning. |
| BIM (Building Information Modeling) | Information-rich 3D model used across design, construction, and facility management for coordination and cost control. |
| ESG Tech | Platforms tracking emissions, consumption, compliance, and ESG reporting for real-estate portfolios. |
| Energy Management System (EMS) | Systems collecting meter/equipment data, establishing baselines, and automating energy optimizations and alerts. |
| AI Valuation | Machine-learning models estimating property value using transactions, yields, locational and asset features. |
| Virtual Tour | 3D/VR walkthroughs enabling remote viewings and higher qualified-lead conversion rates. |
| Smart Locks | Digital access control with centralized management, audit logs, and temporary credential issuance. |
| Tenant Experience Platform | Apps unifying ticketing, payments, visitor access, amenities, and communications for occupants and managers. |
| Occupancy Analytics | Sensor/Wi-Fi-based insights on space usage to optimize layouts, cleaning, staffing, and leasing strategy. |
| Construction Tech (Contech) | Software and hardware improving project coordination, safety, quality, and schedule adherence in construction. |
| Digital Leasing | Automated workflows for marketing, screening, contract generation, e-signature, and onboarding. |
| Automated Maintenance | Predictive systems detecting anomalies and triggering work orders to cut downtime and truck rolls. |
| 3D Mapping | LiDAR/photogrammetry scans producing accurate spatial models for surveying, retrofit, and clash detection. |
| Smart Metering | Digital meters for electricity, water, heat, gas providing interval data via dashboards and APIs. |
| Blockchain Real Estate | DLT-based applications for secure transactions, registries, and asset-backed digital instruments. |
| Tokenization | Fractional ownership of real estate represented as blockchain-based tokens for fundraising and liquidity. |
| Property Management Software (PMS) | Integrated platforms for rent, maintenance, accounting, workflows, compliance, and stakeholder communications. |
