Dive Brief:
- Commercial real estate data and marketplace provider CoStar Group signed a definitive agreement to acquire all outstanding shares of Matterport, a Sunnyvale, California-based firm that focuses on capturing spatial data and creating digital twins of built structures, to the tune of $1.6 billion, CoStar announced on April 22.
- The transaction, expected to be completed during the year, is subject to the agreement of Matterport stockholders and the satisfaction of customary closing conditions, including applicable regulatory approvals, per the release.
- Matterport, founded in 2011, leverages 3D-capture to generate photorealistic virtual tours and digital twins of structures. CoStar was one of Matterport’s first adopters, and has almost 300,000 Matterport digital twins available in its information platforms and online property marketplaces.
Dive Insight:
CoStar and Matterport executed the deal via a cash and stock transaction. CoStar made the purchase at $5.50 per share, and Matterport stockholders will receive $2.75 in cash and $2.75 in shares of CoStar common stock for each share of Matterport common stock, per the release. Matterport’s revenue in 2023 was $158 million, 16% growth year-over-year from 2022.
While a $1.6 billion exit for a 13-year-old startup in the property and contech space might seem like a victory for the sector, the dollar figure is well below the nearly $10 billion valuation Matterport garnered shortly after its IPO in July 2021, according to real estate publication BuiltWorlds.
The firm’s Property Intelligence product uses spatial data, computer vision and deep learning to automatically calculate square footage, including dimensions of walls and ceiling heights from a scanned space. When announced earlier this year, Matterport said that’s a big time saver, as contractors can spend up to 10 hours manually measuring and labeling elements within a 3D model.
Aside from software, Matterport also produces a line of physical tools to capture data, which include the company’s flagship LiDAR-based Pro3 camera, which can work on spaces both inside and outdoors, per the release. It also boasts Cortex, an artificial intelligence solution that automatically generates the 3D digital twin and virtual tour, and can also provide property dimensions and room layouts.
Moving forward
Matterport’s portfolio also includes a breadth of data — the company curated what CoStar calls one of the largest and most precise collections of spatial property data worldwide. It contains more than 12 million spaces, captured across 177 countries. Altogether, it represents more than 38 billion square feet of digital property under management, per the release.
CoStar plans to buttress Matterport’s research and development into new solutions via investments. Solutions that the company is looking at include the use of AI and machine learning to extract information from the 3D spatial library, alongside the application of generative AI “to imagine and reimagine physical spaces,” said Andy Florance, founder and CEO of CoStar Group, in the release.
“People now select their next home, apartment, office, store, hotel or warehouse on their mobile devices, often without ever visiting the property,” Florence said. “There is no better way to remotely experience space than via Matterport.”
Editor’s Note: This story was updated to include information about Matterport's valuation after its IPO.
