On the 22nd episode of Enterprise Software Innovators, hosts Evan Reiser (Abnormal Security) and Saam Motamedi (Greylock Partners) talk with Sandeep Davé, CDTO at CBRE. CBRE is a Fortune 500 commercial real estate company, with $27B of revenue and more than 100,000 employees operating in over 100 countries globally. In this conversation, Sandeep shares fascinating insights into CBRE’s innovative uses of technology, including augmented reality solutions for technicians, their venture into consumer facing applications, and AI capabilities that reinvent the commercial real estate experience.
Quick hits from Sandeep:
On CBRE utilizing AR/VR solutions to combat the talent gap: "The built world is going through this transition where especially for complex assets such as life science labs or hospitals, the technician talent and the knowledge pool of the technician talent is reducing. And so we actually applied AR capability to [have] four eyes in the field…you have a more junior technician in the field, but also have a more experienced technician behind the scenes, seeing what the person is seeing, guiding them through what changes they or what the diagnostic is and what they should be doing as a result."
On 'self-healing' buildings of the future: "I think we are starting to scratch the surface on remote diagnostics and remote maintenance. I fully see ten years from now the likelihood of this concept of self-healing buildings, where they are much better managed with less human intervention, and the humans are doing a lot more productive work than they do today."
On generative AI transforming real estate planning: "Imagine designing a building and saying, well, I wanted to have this ESG footprint and running multiple models through generative AI technologies, then creating a visual digital twin of it and saying, well, here's how it would look, and these are the different ways that it could look. And then being inside the building to say, well, would you like it to look like this? And see it in an immersive manner, not just on your browser, but to see it in an immersive manner. The possibilities are so tremendous, and clearly I'm excited about it."
Recent Book Recommendation: Play Nice But Win by Michael Dell
Saam Motamedi: Hi there, and welcome to Enterprise Software Innovators, a show where top technology executives share how they innovate at scale. In each episode, Enterprise CIOs share how they've applied exciting new technologies, and what they've learned along the way. I'm Saam Motamedi, a General Partner at Greylock Partners.
Evan Reiser: And I'm Evan Reiser, the CEO and Founder of Abnormal Security. Today on the show, we bring you a conversation with Sandeep Dave, Chief Digital and Technology Officer at CBRE. CBRE is a Fortune 500 commercial real estate company with $27 billion of revenue and more than 100,000 employees around the world. In this conversation, Sandeep shares fascinating insights into CBRE's innovative uses of technology, including augmented reality solutions for technicians, their venture into consumer facing applications, and AI capabilities that reinvent the commercial real estate experience.
Evan Reiser: Sandeep, thanks so much for making time to chat with us. So maybe you can kick us off, today, do you want to share a little bit about the background on CBRE generally and maybe your role there?
Sandeep Dave: Yeah. So CBRE is the world's largest commercial real estate services investment brokerage firm. So, essentially, we help our clients through the entire lifecycle of commercial real estate, from finding space, whether it's buying or leasing, building the space out, managing that space, and then even real estate as an alternative investment class. And we are global, we are a Fortune 150, we operate in over 100 countries, we process 500 billion in transaction volume, we manage close to 7 billion square feet. So it's a pretty significant operation. In my role as Chief Digital and Technology Officer, I oversee all aspects of technology for the company, from digital strategy to enabling technology for the segments that we report in our venture investments, our partnerships, and then the traditional CIO function as well - cybersecurity, financial systems and so on.
Evan Reiser: One of the things that Saam and I've really enjoyed about this show is we get to hear these really unique ways that people are using technology that may not be fully appreciated. So, of course, I have to ask you, maybe you can share some of the ways that CBRE is using technology in ways that maybe an outsider would not expect? It might surprise the average person that wasn't super familiar with your business.
Sandeep Dave: Yeah, absolutely. I will maybe give a little broader context, and then I'll click into that example, which is really interesting. So, obviously, this term ‘Metaverse’ was really in vogue recently, until AI took over. But what we said is what is a real world application? And working with our technology partners, we said, well, it's the Industrial Metaverse, at least that's relevant for us. And the Industrial Metaverse for us was the combination of the digital and the physical worlds and how do you deploy IoT at scale to capture data, in addition to IoT and sensors, but also from traditional BMS systems, to generate analytics in real time, to take corrective action, to run predictive analytics? In that scope of what we call the Industrial Metaverse, we also came into this problem where the built world is going through this transition where, especially for complex assets, such as life science labs or hospitals, the technician talent and the knowledge pool of the technician talent is reducing. So we actually applied augmented reality technology, so HoloLens capability to apply four eyes in the field. So you would have a more junior technician in the field, but you would have a more experienced technician behind the scenes seeing what the person is seeing, guiding them through what the diagnostic is, and what they should be doing as a result. It's live. It's live with 20 clients, and it's being used, and clients are asking for it. So it's an interesting application that is potentially surprising for your listeners.
Evan Reiser: We had this guest the other week who was talking about, kind of, smart buildings, and he said, hey, smart buildings, like, people know that you build out of more modern materials, right? You, kind of, better manage HVAC. The extent in which these technologies are being used are not fully understood and he gave an example where in some of their office buildings, they installed motion sensors in every room. They would automatically control the shades to make sure that it was a more consistent temperature over time. That was really impressive to me because I was like, you don't appreciate that as a user of that product. Are there any other examples of the way technology might work in real estate that people would be impressed by or surprised by or that might be otherwise hidden?
Sandeep Dave: Yeah, and see, smart buildings itself is an interesting topic because smart buildings have been around forever. This concept is not new. But what has happened so far is that Smart Buildings, everybody had this trophy building to showcase. Then the rest of the portfolio was, let's call it dumb buildings, right? Until now, where there is this combination of both, technology that's available at scale, but also the need, which is driven by the fact that 39% of greenhouse gas emissions are contributed by real estate, and there's a real desire to address that as a problem. Today what we do is we deploy smart buildings at scale. Yes, there’s this interesting sensor technology, but the ability to ingest data in any and all forms, whether that's live streaming or batch processing, from sensors to BMS systems to just batch, and then analyze it, land it in a consistent data model, run analysis and take corrective action to manage the build environment at a portfolio level, and not just at a one building level, is where we are actually moving the needle for our clients and for the build environment.
Saam Motamedi: I think, maybe to follow up, because I really love these examples, and I think the smart buildings are a really interesting set. The other thing you referenced, and by the way, I love the phrase Industrial Metaverse, when Evan and I first started the show, the Metaverse was really in vogue, and we were just asking every guest, like, help us understand how this impacts our lives, and I think the way you described it is a really good and concrete example. So I just want to unpack that a little bit more and tie that to your commentary on the talent side. I think it's a common thing across industries where labor markets are tight, it's hard to find people for the right roles and get those people productive quickly and a key application of technology is to help accelerate and solve that problem. How have you all done that with technicians and maybe expand on that example for a few minutes?
Sandeep Dave: Yeah, I think this one particular example that we were talking about, where obviously we invest in training, we do it in a few different ways. One is where we try to ensure that we have the knowledge base, the right information at the right time is made available to our technicians. The second thing that we've done is we have focused on these three outcomes for our clients: efficiency, energy, and experience in the workplace. And in that, particularly focused on efficiency and energy, we are focused on remote diagnostic and virtual maintenance, which is that, rather than a technician always having to be dispatched then showing up at the site, doing a diagnostic, then going back and saying, these are the parts that I need, then going back and taking on the trip and saying, now let me go fix it, how do we actually generate enough insight so that the technician knows what they're going to solve or, in some cases, even virtually solve it? So remote diagnostic, virtual maintenance. And then, of course, the other example that I was referring to, which is in really complex environments, how do you leverage somebody with expertise who can use augmented reality to support the more junior technician in the field?
Evan Reiser: And Sandeep, that's a lot different from the way the world worked, like, ten years ago, right? We're on this kind of great curve of technology where it's going to be even more impressive. Can you help us to look into that future a little bit? What does your industry look like ten years from now, and how is technology going to change your business? What does it mean for real estate? What are the implications for your customers?
Sandeep Dave: Yeah, and Evan, maybe one of the things that you said, in terms of something's not changed in ten years, that triggered a thought and I'd love to share another interesting application of technology where we've actually pushed the boundaries for CBRE as well. When we do our strategy exercises, we often look at what are the trends? How is the industry changing? Is there disruption? One of the things that we had noticed is that, while a lot of the conversation was around agile workspaces, the hidden trend was around employee experience and if you think about how our lives have changed, the way we order food, the way we hail a cab, that's all dramatically changed and made available in the palm of our hand. But the workspaces have remained the same. Except, yes, it may be a different look and feel, it's more of an open seating environment. But, inherently, one example is people tend to get creative around how you name conference rooms, you name them around cities or artwork or, in our workspace, we've named it around interesting technology and then people are looking around saying well, where exactly is this conference room? So we noticed this trend and we said we are going to focus on employee experience. One of our clients at the time, interestingly, such was the timing, that they released an RFP saying we are going to rethink the experience in the workplace, create something next generation, but we are not going to include CBRE in the RFP process because CBRE is not really that next generation company. And we had just started our digital transformation and what we told that company is that well, you can define “next generation” the old way, which is a range of documentation through an RFP process, or we can all get into a room through a design thinking session for two days, and we did exactly that. We got everybody together and after two days we walked away with a clickable prototype, and the client was just wowed. And that employee experience capability, which we call CBRE Host, actually has pivoted so many times. In the startup world we talk about product market fit and product pivots, we have that experience focused on next generation, then came COVID, we made it a communications tool, then came return to work and we made it a return to work tool. It is live in 700 buildings with logos and clients that you would recognize in 25 plus countries. It was the first consumer facing application for CBRE and it's just dramatic in terms of the impact that it has had.
Evan Reiser: Well, that's a great story because I imagine, again, ten years ago you probably wouldn't have imagined part of the job here is to go create consumer applications. I'm sure most people outside your business wouldn't realize that some of the work you guys are doing.
Sandeep Dave: It was completely new muscle for us. So then maybe your question around how is the world of real estate changing? Let me just get my crystal ball, no.
Evan Reiser: Can I borrow that when you're done as well?
Sandeep Dave: Who knows, right? I think the one thing that we know is that the industry is not going to be as manual as it is today. All the leases and invoices and all the paper documentation that happens today, we are already applying ML models in many different ways and now with generative AI, those models are going to get even better. In terms of abstracting and unlocking value, I suspect that we'll see tremendous value there. In terms of how we make decisions around investing, a lot of the decisions historically used to be, well, here is the broad trend and here is the market, and so let's invest in the broad trend in the market, whereas investments are going to be extremely micro in the future, where it's about this specific property and here is the exact value of that property, because we know so much more and we've applied technology AI/ML models to improve our understanding. And then we spoke about smart buildings, or digital twins, Industrial Metaverse. I think we are starting to scratch the surface on remote diagnostic, remote maintenance. But I fully see, ten years from now, the likelihood of this concept of self healing buildings, where they are much better managed with less human intervention, and the humans are doing a lot more productive work than they do today. So we'll see. Ten years from now, we can come back and discuss whether any of this was right or wrong.
Evan Reiser: I can see that because you're already talking about, kind of, virtual maintenance and, kind of, self-diagnosis. And so I should imagine that trend goes more towards this self healing concept. Although you said the magical words for me and Saam, which are AI, which is kind of the businesses we're both in. So, yes, Saam, I'm sure you're itching to ask a follow up question here around some of the AI or generative model type topics.
Saam Motamedi: Yeah, I mean, it's funny. Evan, as you're saying, I was thinking, like, over the course of the show, we've seen this transition from early days, everyone was talking about the Metaverse, and now everyone's talking about AI and, generative AI in particular and, that joke aside, I think both Evan and I believe that a lot of computing is going to change with these generative models and their emergent capabilities. Sandeep, if you were to take your most techno optimist hat and think through, like, given the capabilities we see with things like ChatGPT and GPT-4 and Dolly applied to real estate and the buildings we work in, and the way the whole real estate life cycle happens, how might these things get transformed? And if we knew what would happen in five years, we would be like wow.
Sandeep Dave: Yeah, it's such an exciting time, and the potential seems to be tremendous. How much the technology has matured. Now, we apply AI/ML in many different ways. We've discussed some of that in our conversation so far: abstracting unstructured documents, anomaly detection, predictive analytics. But that's more what we've got used to. Obviously, no one even talks about call center support and Chatbots and all of that. But I think that the productivity benefit from generative AI technology is going to be just tremendous. A lot of the time that our brokers spend is in marketing properties. Just the fact that you could probably cut 50, 60, 70% of that time by leveraging some of these capabilities, and that's not even far away, that's probably more here and now. Maybe a little bit more far away is one of the things that we often talk about, that property selection is getting increasingly digital and increasingly immersive. Today we have technology where in a two dimensional environment, or in a three dimensional rendering, we are able to show that, well, here are three or four different patterns, would you prefer a contemporary setup or a more warm organic setup? And here is how the fitting would look. Now imagine just designing a space, designing a building through construction and saying that, well, I wanted to have this ESG footprint, and running multiple models through generative AI technologies, then creating a visual digital twin of it and saying, well, here's how it would look, and these are the different ways that it could look. And then being inside the building to say, well, would you like it to look like this? And see it in an immersive manner, not just on your browser, but to see it in an immersive manner. The possibilities are so tremendous, and clearly I'm excited about it.
Evan Reiser: We actually kind of imagine that, right? Because someone that's leased office space before, even being there in person, it's hard to imagine, hey, what would it be like to actually work in there? Right? Especially if it's not the target configuration. So I can imagine with the CBRE GPT, you say, hey, given some floor plan, given some property, I want it to be industrial modern, I want to set it up for so much work space, I want to make sure there's light over here, I want a kitchenette, it kind of renders that out, right, to like a digital model that's interactive. That's probably just much more efficient than the thousands of hours it might take to set things up or do renderings and have people travel to the office. That seems like a plausible future.
Sandeep Dave: Yeah, indeed.
Evan Reiser: Maybe just take one more question on AI. Are there other examples of how you're applying AI technology or machine learning in ways that just other people might not expect today?
Sandeep Dave: Yeah, so I already spoke about some of the examples around abstracting unstructured documents where, before, it was completely manual, now we are applying AI, and that's unlocking a lot of productivity, anomaly detection, predictive analytics. But here's an interesting example, and the best AI is when it's just working in the background, giving you simple prompts, and you don't realize that it's making your life better. And we spoke about this CBRE Host, the employee experience product that we were talking about, and everybody right now is focused on returning to work. All the employers are thinking about, well, what are the amenities that I need and what is the environment that I need to create to bring people back to work? Well, what we say is that the most important amenity that the employee is looking for is another employee in the workplace. Because what ends up happening is that I show up to work to spend the whole day on video calls, and that then defeats the purpose of me being in the workplace. And so the way we are trying to apply AI, in this employee experience product, is to prompt. So I would get a prompt saying, okay, well, Sandeep, you're planning to be in the workplace on Thursday, and that's a good day, because based on the network that you interact with and the meetings that you have, you are likely to have a productive working day in the office, versus no, today is a good day to be at home. And then subtle prompts around, hey, 2:00 PM Thursdays you typically have a conversation with Evan and Saam and so, would you like to schedule a meeting? So those are ways in which we are trying to make things better and, for the last ten years, the workplace has not changed, but we are now slowly, slowly trying to change.
Saam Motamedi: I'd say, like the examples you just walked through, both in terms of what's happening today and also the future, are some of the most exciting and illustrative of the impact this technology is going to have. One of the keys to being able to deliver these experiences, I want to shift the focus to internally, you as a leader, and how you build your team and create the culture that fosters innovation. So talk about your approach as a technology and innovation leader inside the company and what distinguishes it.
Sandeep Dave: Yeah, I think I'll highlight two things. I've spent a lot of time in high tech, telecom, financial services, and I've sort of seen two models, and both models work depending on what you're trying to solve for. The one model that I've seen is where there are innovation labs, there is a venture arm, there are investments, and you see a lot of innovation, but you don't transform the core business. And what we were very clear about is that we needed to transform the core business. There was a lot of interesting innovation, some of which we've spoken to, and there was a lot of just non-sexy, like I need to rationalize my ERPs and all of that, and that's the model we went after and it's working for us. So that's one. The other is we are very conscious, we've taken a build by partner approach where we've said that there are certain things that we will build because those are differentiating for us. We will buy, and that means licensing or acquisition, when there is a real opportunity or there is a commodity. Licensing for commodity, acquisition for opportunity. And then we'll be very active in the prop tech climate tech marketplace. We were one of the first investors to incubate a prop tech venture capital six, seven years ago. We now have global coverage through our venture partners and, just by the sheer size of CBRE, we get a lot of exposure to interesting innovation, and we always try to form strategic partnerships with interesting innovation that's happening in the marketplace, where we believe that that's applicable to our business and that they're able to scale with us.
Evan Reiser: And Sandeep, one kind of follow up question there is more around partnerships, especially with COVID and some of the new technology advances, I can imagine your business is changing very quickly, right? And there's going to be new types of technologies that are emergent. The new technologies are going to probably start right in the startup world. Can you maybe talk a little bit about how and when and why you choose to partner with startups and what patterns you've seen that create successful outcomes for you versus maybe one of the traps that other people might step on by mistake?
Sandeep Dave: We get a lot of exposure to the startup community. There are probably two or three things that I have taken away from our experience and investments. One is that you really do need global coverage. What works in APAC and APAC itself, when we say APAC, we try to generalize as if all of APAC is the same, even APAC is significantly different, right? Or Europe for that matter. But you do need that local nuance of here is what is working in this market. So that global coverage is really important and so therefore having a pulse on innovation, if you're a global company, for the markets that matter is really important. The second thing that we have learned is that we tend to identify startups that we know will be able to scale with us. And even when we identify a startup that is relatively mature, has a proven way of working, and that we believe that we can help them scale, they still struggle to scale. So it's really important to do that because if you have some really early stage startup then they just are not able to scale or, especially because we are in the business of serving other large Fortune 500 companies or other large landlords, there are certain requirements that come with it around security and the posture that they expect, and so we typically work with the startup community to then get to that point, but they have to be mature enough. And the third thing that we've been focused on is to not chase the shiny object. We always start with what is this critical business need and then we scan the market for the problem that we are trying to solve versus the other way around.
Evan Reiser: So Sandeep we’d like you to do what we, kind of, in a very cheesy way call Lightning rounds, right? Basically go through like five, six questions and we’re looking for the one tweet response. Let's start there. And Saam, do we want to kick it off first?
Saam Motamedi: Yeah, absolutely. So maybe to kick us off, Sandeep, how do you think the company should measure the success of a CIO?
Sandeep Dave: Yeah, I think in three ways. One is business outcomes, have they really prioritized what really matters and have they delivered on those business outcomes? Second is the strategic impact, which is really important for a modern technology executive, are you a trusted advisor to the business? And the third is operational efficiency, which is do you really run an efficient shop?
Evan Reiser: And Sandeep, this may be related, but are there common mistakes you see new IT leaders or new CIOs or new CTOs make, that you maybe warn people to look out for?
Saam Motamedi: Yeah, in my view, a common mistake is that today's technology executives have digital in their titles. My title is Chief Digital and Technology Officer. And there is a reason why digital is there in that title, you are expected to know the business, drive strategy, and be a trusted advisor. And in my experience, because the segment stakeholders, the line of business stakeholders, don't really know and understand how you execute technology, that's the trade that they value the most. And I feel that a lot of technology executives that are maturing and have grown up in the technology practice have not really honed their digital skills, and that is a really important skill to have.
Saam Motamedi: Sandeep, we've talked about a number of exciting projects you've worked on at CBRE or are working on. I'm curious, is there a single technology initiative you've implemented or are implementing in your current role that you're most excited by?
Sandeep Dave: I think what I would say is that what we have done with respect to data in our environment, where we had a hypothesis that CBRE is the largest commercial real estate organization, so therefore we would have a data advantage, to a point where breaking down the silos, capturing data from 300 plus data sources, and that being live with 350 plus clients has been a tremendous journey.
Saam Motamedi: So maybe to transition to the personal side, what's a recent book you've read that's had a big impact on you and why?
Sandeep Dave: So, great question. The one that I recently read was from Michael Dell, Play Nice, But Win, and it's a really interesting book and reminds you that people perceive success to be this straight line with an upward slope, but it never is a straight line with an upward slope, it's always filled with ups and downs and challenges. And it reminded me of the importance of character and tenacity and grit. It was really interesting to me.
Evan Reiser: Okay, maybe one final question. What do you think will be true about technology's future impact in the world that maybe most people feel would be science fiction today?
Sandeep Dave: That's a tough one. It would be amazing if technology played a critical role, and I do believe that technology has the potential to play a critical role in solving some of the toughest problems that we are dealing with. And the one that comes to mind is particularly around sustainability and the climate crisis. And because I'm in real estate, I feel like there is such a huge potential for technology to play a role there. Wouldn't that be amazing?
Evan Reiser: Well, Sandeep, thank you so much for joining us, we really enjoyed chatting with you and hopefully we’ll get to chat again soon.
Sandeep Dave: Yeah, thank you so much for having me. I really enjoyed the conversation.
Saam Motamedi: Thanks, Sandeep.
Evan Reiser: That was Sandeep Dave, Chief Digital and Technology Officer at CBRE.
Saam Motamedi: Thanks for listening to the Enterprise Software Innovators Podcast. I'm Saam Motamedi, a General Partner at Greylock Partners.
Evan Reiser: And I'm Evan Reiser, the CEO and Founder of Abnormal Security. Please be sure to subscribe so you never miss an episode. You can find more great lessons from technology leaders and other enterprise software experts at enterprisesoftware.blog.
Saam Motamedi: This show is produced by Luke Reiser and Josh Meer. See you next time.