Why I Joined Building Ventures: For a Better Built World
For the many of us already working for a Better Built World — with backgrounds in Construction, Tech, and across disciplines — this call to action resonated:
….we should be asking the question, what are you building? What are you building directly, or helping other people to build, or teaching other people to build, or taking care of people who are building? If the work you’re doing isn’t either leading to something being built or taking care of people directly, we’ve failed you, and we need to get you into a position, an occupation, a career where you can contribute to building. There are always outstanding people in even the most broken systems — we need to get all the talent we can on the biggest problems we have, and on building the answers to those problems.
Marc Andreesen, IT’S TIME TO BUILD, April 18 2020
Good news. There is a growing global community of Builders: Founders, investors, industry leaders, technologists, and others working to narrow the gap between tech at the frontier and solutions available today. Count me among the many who are committed to this mission. My next phase of building continues with Building Ventures. I’m excited to serve the community and invest capital with Jesse, Travis, Allen, and Heather, playing our role in nurturing and scaling impactful teams with high potential.
Over the past decade, I was fortunate to see many aspects of the Built world. This included frequent visits to job sites to meet customers. Across several roles and countries, I was privileged to work with many of the 30,000 professionals at Hilti. Hilti knows the demands of the sector and that technology must be robust. There is no ‘one’ Construction trade. The range of companies and specialties spans wider than the variety of structures built. Whether on a jobsite or staring into our CRM, the variety was at times boggling. It was also clear how demanding users and building codes will be.
Four automakers sell over half the cars in the U.S. It would go into the thousands, to count all the general contractors (“GCs”) behind just half of the new buildings completed in the U.S. per year. Startup teams targeting the Construction sector, often engage first with the largest GCs. It’s great that many startup teams find increasingly open doors. Many of the well-known companies in the ENR Top 400 are organizing new innovation teams and processes, or at least defining a role with clear accountability to keep a pulse on new digital technology, including that from startups.
Large companies grab our attention, but the bulk of contractors are small businesses. Considering the U.S. market, the Census counts over 7,000,000 workers and over 800,000 firms. The companies not on the ENR 400 list put in place over 70% of the U.S. Construction output by value. Only an elite set of these have innovation teams. That sets a high bar for startup teams to plan for adoption, if they are serious about one day reaching the full potential addressable market. Most companies, and especially at the median and long tail of the size curve, have precious little time to try and deploy tech.
Over the past 3 years I have seen hundreds of potentially new solutions for the sector, and met with many others serving this ecosystem. I moved to San Francisco in 2018, to open a function helping Hilti explore startup collaborations. Fortunately just days after moving to SF from Madrid, there was the annual ENR Futuretech conference, a first chance to get oriented in this community. Jesse Devitte and Allen Preger were one of the first teams I met on the sidelines. That was fortunate, because it would have been easy to get lost among the dozens of startups at the booths, and the hundreds (now thousands) across this startup ecosystem.
The Building Ventures team helped over the coming years, as they support a range of leading companies also beginning to explore startup collaborations. Engaging at the Building Ventures network events, I saw became part of the pro-community spirit, curiosity, and open dialogue about key themes. Many startup intros and several of our key collaborations now public and some for the future, were thanks to this involvement.
This is a community which keeps closely-knit, because building projects require tremendous cross-company teaming. A closed approach in this sector, or with its new digital technologies, will not be a winning formula. Getting the people, partners, and digital workflows to fit is critical. As Jim Barrett reflected on while visiting the ConTech crew podcast, the industry change won’t come from technology rather from technology plus people plus process. That is fundamental. And that’s why Building Ventures sets a high bar for backing extraordinary founders who get it and are ready to work with not despite this complicated sector whether in Design, Building, Operating, Experiencing.
These four lifecycle phases are familiar to the sector. It would be easy to map startups, if each neatly fit in one phase. We also use that framework. But some of the highest profile teams have unique business models that weave across, part of the growing trend we call Constructuring. Numerous startup successes are reaching bigger headlines. Funding in 2020 surged again. Change is on the march. In 10 years, none of us want to see that McKinsey productivity graph, as flat as it’s been, for yet another decade.
Construction and its workings fascinated me ever since a high school summer job with Wilhelm Commercial Builders at an office park near Baltimore. I had to move quickly hauling trash behind a drywall crew, who left home in Northern Virginia by 5am to beat D.C. traffic and arrive on time. That experience left me with a lasting impression about the culture, coordination, and work ethic. The technology gap also caught my attention. Tools and equipment of the trades was on another level than what the tech available at NASA during the prior summer internship, or at Honeywell the following summer. Those early experiences also left an impression about the discipline of serious engineering, also emblematic in the DNA of Hilti and its hardware.
Several weeks ago, I spoke by phone with Wayne Wilhelm. He led Wilhelm Commercial Builders for decades. Hearing about his business challenges, and sensing out some technology ideas, keeps me grounded with what’s really reaching the market. While there are many excellent Construction tech gatherings, I would be remiss to not regularly talk with those closest to building projects. The roles at Hilti taught me the challenge, passion, and realism about directly introducing technology to this sector.
During recent talks with a startup Founder, we got sidetracked talking about my experience decades ago with reality capture at NASA on that internship. Alongside an excellent mentor, I was pouring over VHS tapes reviewing step-by-step the activities completed during each of the prior Hubble Space Telescope servicing missions. Wrench turn by turn, I logged into Excel the timing so we could compare this later with the plan. This was as good as it got, for the 1990s version of “reality capture” analytics. Core data preparation is needed by any operations management professional to observe, analyze, and guide improvement. Excel and manual processes remain the go-to choice for most Construction back office tracking. Activity logs are scarce; quality and clean data: scarcer.
Better solutions are finally coming to Construction to make that easier. They are making inroads among the early adopters among GCs of all sizes with an eye for continuous improvement. Whether from the crane view,helmet view, or the wrench view, there are new ways to automate data logging, a step missing for further analyses. No wonder a range of councils have set up to explore what data we need and how to deploy it meaningfully. One of these is the Predictive Analytics Strategic Council. These are not easy analytics; but manufacturing and other sectors have led the way. Skilled people can do this; but they’re expensive. So let’s welcome more tech sector talent, to build the solutions that can help automate insights, and use mobile friendly SaaS tools to drive all the way into the field better and clearer assistance for time-constrained managers.
Legacy companies supplying technology with established brands will be vital to also bringing new digital solutions. There are so many of them. Walking the trade halls in ConExpo in Vegas last March, as we began nervously avoiding handshakes ahead of the shutdown, it would have taken days meeting just half of the manufacturers. Each of them should ask, how this McKinsey productivity curve has stayed so flat, on their long watch. A certain Robotic dog physically there and carrying a laser scanner caught a lot of spectators at Conexpo. Why? It also brings a ton of YouTube clicks: why? Perhaps one part entertainment, two parts novel use cases, and three parts inspiration that we are on the verge of more to come. In future years, we will see more Robotic machinery and further Software-equipped machines at Conexpo. Korea, Germany, Israel, and many other countries will deliver tech that wows. That’s great news for this industry.
Across others industries, we have already seen a rising wave of startups shake up and wake up sleepy industry giants. Users are impatient for more gains sooner. Talents from universities are impatient to work at companies with impact, not bureaucracy. Users investing heavily, demand more open access for APIs and tuning their Software, not buying closed systems. Tesla has woken the Big Auto boardrooms these last years, going from denial, to action; but falling behind can also be from self-inflicted mistakes. Good things will come from competition and fresh business models. WeWork got carried away and is no longer in expansion mode, but more of the sector now knows the Space as a Service trend. That’s on a one-way growth path. The incumbents have upped their game, just in time for a next battle to convince office workers to return from WFH mode.
Those knowing the industry, know how detailed and varied its sub-sectors are. No single company can disrupt an industry, when it’s actually an industry of many sub industries. Knowing that prompts us at Building Ventures to run and keep close with an industry innovation network that engages expertise from across the lifecycle. Building Ventures partners with companies for both investment, and expertise. Supporting those partners and innovators will keep challenging us to learn.
Building Ventures does not aspire to be the largest VC fund, or have its eyes on frontier tech science experiments. The team aspires for excellence as one of the most proactive community builders. We are supporting Founders inside our portfolio, and also ones not currently. We are serving as a point of advisory for our Strategic investors, and also for those in our Innovator’s Network and beyond.
While providing services and capital, I hold deep respect for the personal mission that so many Builders are on. That goes for Builders of the physical world, and for Builders of companies. Founders are courageous, and they’ve been my inspiration (thank you) to invest as an advocate and supporter of the community. Count me in as one of the backers, committed to serving this community. I am delighted to join Building Ventures, and this community’s mission for a Better Built World. Let’s connect, and let’s Build!