Exclusive: what £23m investment means for the property market

This week Coadjute announced a £10m strategic investment funding round led by Lloyds Banking Group and including Nationwide, NatWest, and property portal Rightmove, bringing the banking and property portal behemoths together for the first time. It brings the total accumulative investment in the organisation since its launch in 2018 to £23m

Today’s Conveyancer sat down with CEO Dan Salmons, to understand more about what this latest round of investment means for conveyancers and the wider property market.

 

Today’s Conveyancer (TC): Given your recent funding announcement, what are Coadjute doing over some of your competitors to win the support of major institutions, and bring them together?

Dan Salmons (DS): What Coadjute does is quite fundamentally different to others in the market, and indeed to anything that has gone before. At the heart of it, Coadjute is an open network, which means that anyone can connect and share information securely and seamlessly with others on it. So, we are really a piece of market infrastructure, in the same way that Visa, SWIFT or a Stock Exchange is.

These big players all want to see a more efficient property market. They believe today’s property market is not serving consumers as well as it can be, and they recognise that individually they can’t change that. What they want to see is market wide infrastructure that everyone can use, to the benefit of the whole market. That’s exactly what Coadjute is, which is why they are supporting us, because it is good for them, and good for everyone in the market.

Coadjute is also bringing people together who want to see a more open and digital property market. For example, we advocate for the data in the property market to be digitised and structured in such a way that it is findable, accessible, interoperable, and reusable (what the government calls ‘FAIR’). We’ve worked as part of the Home Buying and Selling Group to develop the open data trust framework. We continue to be one of the main contributors to the standard through our membership in the Open Property Data Association (OPDA). We want to change the market for the better, and our partners like that.

And finally, a key difference of our technology to a traditional ‘closed’ PropTech is that it enables more innovation and competition in the market. By making systems more interoperable, and data to be accessed from anywhere, we believe we can create the rails on which all sort of exciting future developments run, to the benefit of property professionals and consumers. We are really just at the very beginning of what Coadjute can mean for the property industry.

TC: What progress are you making? Who are you working with?

DS: We are making rapid progress indeed. The first challenge of any endeavour like Coadjute is whether it is even possible to build a national infrastructure for the UK property market. What we developed at Coadjute over the last six years has shown how that can be done. The network has been processing live transactions for more than two years, during which time the scope and sophistication of the network has grown exponentially.

In terms of product, Coadjute provides beautifully simple workspaces for conveyancers, estate agents, and brokers so they can access the information they need easily and share it across the property transaction process. For conveyancers we’ve recently released our enquiries manager, digital referrals, digital TA6 forms, and integrated digital identity – all designed to help conveyancers either win more business or complete their day-to-day tasks in a more efficient way.

As for partners, we are now rolling out with some of the Top 20 conveyancers and estate agents, so you’ll see increasingly the expansion of the network into the wider market and into brokers.

TC: Are conveyancers telling you upfront information, sharing of property data to smart contracts, digital identification, and synchronised settlements are the problem in conveyancing? Are we trying fix the bits that aren’t broken?

DS: Firstly, I don’t think it’s an ‘either/or’ in innovation. If there are other challenges that we don’t tackle that others think they should, we’d be the first to support them!

That said, at the heart of what is going on in a property transaction is the processing and flow of data, which means that if that data is not easily accessed, or verified, or shared, then it is going to reduce the efficiency of everything else.

So, whilst everyone in the industry will have their own perspective on ‘what needs to be fixed’, when you look at the system as a whole, most roads do lead to better flow of data. You can think of it a bit like supply chain in manufacturing, where many of the problems that looked like they were to do with warehouses, trucks, goods, etc were actually solved in the last few decades by sharing data more efficiently.

Of course, within that broad area of ‘data’ you need to prioritise, and our roadmap is led very much by what industry bodies like DPMSG, HBSG, Conveyancing Association, Law Society etc are communicating as the big challenges and the areas that should be focused on. There has been a lot of research and consultation over the past decade on the challenges in the property industry and conveyancing, such as the Conveyancing Association launching the Digital Conveyancing Protocol last year. There have also been various initiatives, such as the BASPI Upfront Data Initiative, the Completion by 13:00 Initiative, initiatives around instructing conveyancers early in the process, HM Land Registry’s promotion of digital identity and the recent update to the TA6 form.

There’s no shortage of perspectives on what needs to be solved. What we are doing at Coadjute is delivering new capabilities to the market that address many (albeit not all!) of these issues and allow everyone to move more quickly from discussing the issues, to implementing solution.

TC: Do you anticipate that you’ll deliver those solutions in-house or integrate third party software. And if the latter, do you anticipate offering a choice of providers?

DS: We are an open network, so our aim is always going to be to have as many different providers, services, systems and so on the network. We want to offer customers the maximum choice and flexibility, with secure and seamless access to the widest range of what they want to access as possible. Importantly, this comes entirely without today’s barrier and overhead of having to make a big investment in integration to connect to something new.

Of course, we do have standards that third parties have to meet, particularly around security, as every party on Coadjute is verified. Also, at the moment we have built up a backlog of parties that are wanting to join, so we are having to prioritise. Expect over time though there to be a very wide choice of providers on Coadjute.

TC: Can you share any information about how you anticipate the Coadjute network being financed during a transaction? Who bears the cost?

DS: Our fees are structured in a similar way to most SAAS (Software as a Service) products. We have a license fee which enables you as a user to connect to the network, and then we have a per transaction fee. We also provide access to data supplied by third parties, such as property data, and we charge for that kind of data or service. Conveyancers can pay charges themselves or pass it on to clients in a way similar to other disbursements.

TC: One major issue in conveyancing is continuous re-keying of information; is this a hurdle Coadjute can solve?

DS: Of course, this is another key reason why we are different to our competitors. We can connect to most of the case management systems (CMSs), so when conveyancers join Coadjute their Coadjute workspace is completely integrated. Think of Coadjute is really as a companion add on to the CMS, not a separate system. You log on just once, and data entered on the case management system is immediately accessible in the Coadjute workspace and vice-versa. Effectively, when you install Coadjute your CMS becomes a connected system, and is able (with your permission) to send and receive all sorts of data seamlessly with others in the property deal.

TC: Finally, How does bringing these institutions together facilitate greater collaboration across the property market?

DS: It’s a huge step forward. To date, one of the big barriers for industry collaboration has been the lack of an infrastructure that enables people to work together in a consistent way. Once you have that infrastructure, the next question is naturally whether people will use it! With these major players now endorsing Coadjute, that question is answered. We now have a market-wide infrastructure that major players are using. This opens doors to a lot of possibility that didn’t exist before.

First, the large institutions themselves can now collaborate more easily which each other and other players in the market. In the property market, it doesn’t matter how large you are, you must work with others. Our new investors were already aligned in their vision and commitment to a better market, but what Coadjute now gives them is a shared execution vehicle, a means of bringing that collective desire for a better market for consumers to fruition.

Second, we’ve always said that the only way to digitise the property market was to include stakeholders across the whole process together. This includes conveyancers, estate agents, mortgage brokers, buyers, sellers, and banks. The finance piece must be included otherwise we are only improving a part of the process. The Coadjute network uniquely serves all of these parties, making it a true, market-wide infrastructure.

We are incredibly proud of being able to say we’ve brought these parties together but if you think about it, it shouldn’t be surprising. These institutions want to improve the process for customers, and they’ve realised that we can’t do it on our own, we must do it together. We hope that this is just the beginning of people across the property industry coming together for the betterment of the consumer.

 

Dan Salmons was speaking to Today’s Conveyancer.

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