REDIST

A staggering $100 billion is distributed every year via public real estate incentives in the US, and that amount is growing. These incentives are needed in underserved communities but there is a massive lack of knowledge around their existence and use. We experienced this first-hand while working at public agencies like the City of New York and the City of Hoboken, after joining development, investment and brokerage companies of varying sizes, and by starting a firm focused on building preservation, Amanat Properties. 

REDIST is the first technology-enabled platform that looks to solve this problem by:

1. Aggregating and structuring fragmented data to bring transparency to public incentives
2. Providing tools to estimate impact on the project level
3. Bringing automation and efficiency to the application process 

In doing so, we can have an outsize impact on the physical environment and economic growth of underserved communities across the US.

Public real estate incentives in the US are composed of many monetary awards from federal, state and local agencies to support construction, renovation and operations often in underserved communities. They are valuable, ranging from grants of thousands of dollars to tax credits of hundreds of millions of dollars, are frequently part of project evaluation and can directly determine viability. Total distributions in the US are $100 billion per year and growing, according to the Brookings Institution.

So what's the problem? These incentives are often:

1. Undiscoverable - information on incentives often doesn’t reach the intended audience
2. Misunderstood - many companies can’t figure out the value of incentives to them on the project-level, despite knowing the benefits
3. Inaccessible - applications are long, repetitive and frustrating

This is a problem across the US and we think may also be present in Canada and Europe. Given the current COVID-19 pandemic, our product can help sustain operating margins for existing buildings in an economic downturn, which is crucial for preventing disinvestment in physical infrastructure and resulting community destabilization.

REDIST enables access to fragmented, unstructured, and complex real estate-specific information sets, with a focus on public incentives and related local regulations. Our platform allows users to quickly understand geographically-specific legislation to inform better decisions on real estate from a financial and compliance perspective. REDIST also streamlines the efficiency of the various application and approval processes, directly reducing time and labor costs. We can provide details on our process and the related technology step by step upon request.

REDIST can impact the lives of Americans living and working in underserved communities by making it easier for small to medium sized businesses to discover, understand and access public real estate incentives. This will help transform the housing, offices, retail areas, manufacturing plants and other real estate in need of improvement and spur new facilities to raise the quality of life and drive economic growth. 

These statistics highlight the economic plight of underserved communities in the US:

1. 12% of Americans are below the poverty line
2. Bottom 50% of Americans have net negative wealth 
3. 32% of Americans spend more than 30% of their income on housing

To understand the needs and perspective of small to medium sized real-estate focused businesses operating in underserved communities, we are including a wide array of firms in our pilot program.

Making safe, clean, quality real estate affordable to those that need it will change this dynamic, and REDIST can play a part in that. In addition, our platform allows larger developers, investors and brokers to discover public incentive programs and invest in areas that are often overlooked because of lack of recognition or stereotypes, thereby putting outside private capital to work along side public incentives.

Real estate is the largest industry in the US. It contributes more to the Gross Domestic Product (GDP) and employs more people than any other. Given that, a product like REDIST that explores a problem in this industry and offers an innovative solution to make the construction, renovation and operations of buildings more accessible through taxpayer-funded, government-distributed public real estate incentives is well-aligned with the challenge of providing good jobs that are both temporary and permanent, as well as inclusive entrepreneurship for small to medium sized businesses.

REDIST does not have competitors. Currently our users would:

1. Do nothing - search time and cost is too much for many small to medium sized businesses, so they are left out
2. Develop in house expertise on a few incentives - this requires a lot of time and expertise is limited to select incentives in select geographic areas, limiting impact
3. Hire specialized legal or consulting services - this costs a lot because of extremely expensive help and requires identifying new specialists for new geographies, again limiting impact

Ironically, we found that these “specialists” often have large knowledge gaps (“don’t know what they don’t know”). Overall, no current options rank highly in quality, value or speed.

REDIST, in contrast, brings a data-based analytical approach to an industry that has long been resistant to innovation. We began with the premise that the status quo could change and had to change: we all need a better way to distribute the $100 billion of public real estate incentives given out every year in a way to increased access beyond those with financial or political influence. 

REDIST applies existing software in a novel way to data that has long been locked in drawers or in other offline locations. We can provide details on the process and the technology involved in each step of the process upon request.

REDIST uses software that is used in urban data science, particularly in the analysis of census data. It combines that with computer languages that are used for the visualization of information across industry and customer-facing mapping software. We can provide the product demo upon request.

REDIST is based on the idea that information can empower. 

Our theory of change is described below:

1. Activities - REDIST's production process
2. Outputs - detailed reporting and visualization on incentives, down to the property level, dynamic calculators to explain the value of incentives for a particular development strategy at a property, technology-driven automation of paralegal-type work as alternative to traditional legal services, AI-driven recommendation engine of incentives to pursue for a given development and new financial products to increase the impact of public incentive award cash flows
3. Short term outcomes - businesses of all sizes across the United States have found it easier to discover, understand and access public real estate incentives
4. Medium term outcomes - companies that have traditionally been marginalized have been afforded greater opportunity to build and drive employment growth in the communities served 
5. Long term outcomes - underprivileged communities are empowered to lead the change they want in the ways that make sense for them, as opposed to always having that dictated to them by large outside corporations

REDIST is a business to business (B2B) product. As such, we measure our impact on the number of companies we reach.

In 2019, we did user interviews and product demos of the minimally viable product (MVP) with over 105 potential users and stakeholders. A large group of firms that represent the target customer segments - real estate developers, investors and investment sales brokers - will begin pilot use of the beta version of the product in Spring 2020. The pilot includes both small to medium sized businesses like Kokes Properties and Stolar Capital and large businesses like Avalon Bay and Newmark Knight Frank. We see our growth as described below:

1. Currently served: 10 companies
2. Served in 1 year: 300 companies
3. Served in 5 years: 5,000 companies

Assuming that an average user will purchase 30 property-level reports per year, pursue work on 20% of those properties, with an average of 100 people impacted through job creation from any phase of the development process from construction to operations, that would amount to:

1. Currently served: 6,000 people
2. Served in 1 year: 180,000 people
3. Served in 5 years: 3,000,000 people

REDIST's goal is to empower real estate business of all sizes with the information, tools and services to discover, understand and access public real estate incentives. We can provide details on the stage by stage goals upon request. Through our users, we will be able to drive more equitable change in underserved communities across the United States.

REDIST's team will face major barriers to accomplishing our goals. 

1. Within 1 year - we are limited by the cost of fairly paying our growing team of talented product and engineering professionals who have the right education and experience to continue driving the company forward
2. Within 3 years - we will be limited by cost again as our team grows to cover the entire US 
3. Within 5 years - we anticipate that we will face blowback at various levels of government because by then, we will be having a clear and unmistakeable impact on local political power structure in underserved communities across the US 

REDIST will leverage everything at our disposal to overcome the barriers to accomplishing our goals. 

1. Within 1 year - we have raised capital from social impact angel investors who see both the monetary and moral potential of REDIST and we continue looking for more individuals like these to drive our growth 
2. Within 3 years - we hope to be able to cover our expenses through operations and additional investor capital
3. Within 5 years - we are leveraging our professional relationships to develop the alliances that will be critical to our continued success down the road, including with well known industry leaders such as Chuck Berman (he founded the publicly traded real estate investment trust Avalon Bay and is our advisor) and with politicians at various levels of government

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REDIST currently employees product and engineering professionals that include:

1. Full time - 4 people
2. Part time - 2 people
3. Total - 6 people

We are proud that 2/3 of our team are people of color and 1/2 are 1st generation immigrants.

The REDIST team is the right one to solve the problem and deliver the solution. That is because we have:

1. Public and private sector domain expertise - we have worked at the City of New York and the City of Hoboken, at large private real estate companies including CBRE, Extell Development, Goldman Sachs, Greystar, JP Morgan and Silverstein Properties and started a small private real estate development firm focused on underserved communities, which have allowed us to experience this problem first-hand many times
2. Technological skills - we are proud alumni of BU (economics), Columbia (finance), Duke (sociology), Harvard (public policy), Michigan (business), Penn (computer science), Wharton (finance), St John's (computer science) and of course, MIT (architecture and urban planning)
3. Deep professional network - with 40 years of experience amongst the 3 most senior employees, we have a wide professional network of real estate companies of all sizes, delivering us a structure both for getting feedback and early customers

In addition, the founders completed Startup School by Y Combinator and were invited to join Lowenstein Sandler’s Venture Crush programming.

REDIST has made key early partnerships that are propelling the product forward. These include:

1. Public incentive agencies - The City of New Haven and other agencies both are both providing agency data and helping us develop our strategy
2. Private companies - 24 firms of all sizes from small to medium-sized businesses to AvalonBay Communities and Newmark Knight Frank will participate in the pilot program
3. Academic - Columbia University selected us to be a part of the Columbia Startup Lab in New York City, where our office is currently located

We have done 105 user interviews and product demos of our Minimally Viable Product (MVP) with the agencies and companies. 

REDIST's business model is based on:

1. Key resources - our team and our data
2. Key stakeholders - incentive agencies providing incentives
3. Key activities - detailed and interactive property level reports describing the relevant public real estate incentives, a dynamic calculator that allows user to make sense of this information and access services including automated application, AI-driven recommendation engine and financing options to support small to medium size businesses
4. Intervention & channel - REDIST's web platform
5. Segments - real estate developers, investors and investment sales brokers of all sizes will pay as users, with communities as the beneficiaries of the resulting development
6. Value proposition - we want to provide for our customers the information and tools necessary to make sense of the $100 billion of public real estate incentives distributed annually
7. Cost structure - subscription based reports and custom pricing for other services
8. Surplus - we plan to reinvest as much as needed back into the company
9. Revenue - we anticipate 50% from reports and 50% from other services

REDIST is applying for grants and raising investment capital in the short to mid term. From there, we hope to be funded through our operations.

REDIST can transform the way taxpayer-funded public resources are distributed and in turn help small to medium size business and underserved communities often marginalized in this political process gain power. In the near term, we are applying to Solve in order to ensure that we have the resources to pay our talented team through the end of 2020. In the long term, we want to be a part of the Solve community for mentorship (monitoring & evaluation) and exposure from beyond our industry to ensure that the product we build is one that is much more than a profit-generating tech startup.

REDIST has the twin mission of physical impact through redevelopment of the built environment and social impact through safe, clean homes and fair employment opportunities for all Americans. Traditional startup investors often talk in acronyms like TAM, GTM, and KPI and focus on how to crank out a 10x return. With that, I think they can easily stray from their own humanity. 

As the CEO, I certainly want REDIST to be financially successful, but there has to be an "and". I want REDIST to be do well for my investors AND the communities to which it drives construction. I want financial success AND impact. Some may say this is a naive or whimsical notion, but if I followed that line of thought, I would be selling myself and my team short. 

And that is something I will never do.

REDIST is particularly interested in working with the following partners:

1. Microsoft - to help us understand the potential of the data we are collecting and structure it in ways to maximize impact
2. MIT Senseable City Lab - to help us consider unusual solutions to the problem of information dissemination and understanding in the urban context 
3. MacArthur Foundation - to help us finance our work through its impact investing group