Former CBRE broker Matt Ellis began his career helping early adopter owners and tenants of office, industrial, retail and apartment properties monitor their energy consumption and use less of it. Now, he said, the rest of the industry is catching up.
Over the past decade, his San Diego-based company Measurabl has built a growing list of global clients that need real-time energy-use data and it just received $93 million in fourth-round funding from a group of prominent venture capital backers.
Measurabl provides software and related energy reporting tools to more than 1,000 global clients in 93 countries, including international investor-developers such as Oxford Properties, Hines and Prudential, along with brokerages such as CBRE and JLL. In fact, the firm says it sells “the world’s most widely adopted” environmental, social and governance, or ESG, software for commercial real estate.
Early on Ellis, the firm’s CEO, said Measurabl “started with ‘early adopters agreements’ with a handful of major portfolio owners” and heads of asset management to determine what they sought to get from its software.
“From there we built our product in lockstep with the learnings from these early adopters (AvalonBay, Clarion Partners, CBRE Investment Management…),” he said in a LinkedIn message. “Those case studies and those portfolio-wide deployments were key to the next wins, and so on…”
The Southern California native who recently moved to Telluride, Colorado, made his way into environmental advisory positions during his early days as a commercial broker at CBRE in the late 2000s and early 2010s, following on an interest in environmental issues he’s had since he was in college.
He didn’t consider himself an environmentalist then, but he does now. “My work has shown me how (new) environmentalism is about better outcomes for people, planet, business so I would like to think any good businessperson is also considering all the risks and rewards from natural capital and a broader range of stakeholders in order to drive superior results,” he said.
When he started out in real estate during the Great Recession, recognition was growing nationally for the need to build office, industrial and other properties in a sustainable way. Developers were angling for certification in programs including the U.S. Green Building Council’s Leadership in Energy and Environmental Design program, better known as LEED.
“My experience as a tenant rep broker at CBRE during the GFC [global financial crisis] showed me how important being differentiated was in real estate,” he said in an email. “I began by learning about green building certifications like LEED, founding a practice group for ‘green real estate’ at CBRE, and generally creating ideas on how to use green to bring value to my clients. The rest went from there.”
Ellis grew to believe it was just a matter of time before cities and states required developers to go beyond design concepts and provide actual numbers showing how their buildings were consuming electricity, water and other resources. Governments across the nation have since passed laws designed to cut commercial and residential energy usage as part of larger, long-term strategies to reduce greenhouse gas emissions.
“It seemed like a no-brainer to me at the time,” Ellis told CoStar News.
So he decided in 2013 to set out from the brokerage world and co-found Measurabl.
Moreover, large corporation and property companies across the globe including JLL have made commitments to reduce their carbon footprints. They need to measure their emissions to monitor progress.
“With all of these states and cities passing these regulations, it isn’t just the big public companies that are making these changes to track their sustainability,” Ellis said. “The small, mom-and-pop property owners are also being affected by this.”
In just the past five years, for instance, several U.S. cities and states have banned or passed measures phasing out the use of natural gas in favor of more environmentally friendly electricity in heating, cooling and cooking systems of buildings.
Public companies worldwide are being measured on how well they live up to their stated environmental, social and governance policies that are increasingly deemed high priorities among investors.
The privately held Measurabl now generates “tens of millions” in annual revenue, Ellis said, and employs a total of 250 at its San Diego headquarters and its office in London.
Last month Measurabl closed on $93 million in Series D funding to support further global expansion, led by Energy Impact Partners and Sway Ventures. The latest financing round had 12 other backers including prominent non-venture capital firms such as Suffolk Construction, Lincoln Property Co. and brokerage Colliers.
Measurabl now faces competition from a slew of tech and data firms looking to serve the same growing clientele, which has expanded well beyond building owners and developers during the past decade.
Ellis said his company’s customer base has expanded to include lenders, credit rating agencies and other firms that need to track ESG metrics and other elements that could impact stock prices and financial performances of corporations worldwide.
“You might not have thought 10 years ago that you needed to be a technology provider or buy technology services to be sustainable, but the signs were there,” Ellis said. “It has been about data collection for a while now, but we did have a head start in putting it together in one platform.”