Last Week in ConTech - 15 July 2024
India to become 3rd largest construction market + Geopolitics impacting global investments
Last Week in ConTech is a summary of the most important construction startup funding, news, policy changes and national project investments in the last 7 days. The goal is to provide decision makers with information on technology solutions and macro-economic trends in construction to help drive innovation in the industry.
In this issue there are:
17 Startup Fundings
10 Policy and Regulatory Changes
9 New National Infrastructure Projects & Priorities
1 New investment funds
2 Acquisitions
7 News articles
87 open jobs - view here
Reading time: 15 mins
If you have any feedback or tips on information I should include in the newsletter, please provide it in this form.
Does the email get cut off by your reading application? You can view the full version online here.
Digital Twins
Buildots, an Israeli startup, raised $15m in funding. They use AI and computer vision to create a digital twin of construction sites ingesting data via 360-degree cameras to track project progress and assist with work planning. More here.
[View open jobs - 4 roles in Sales, 2 roles in Operations, 2 roles in Software, 1 role in HR, 1 role in Civil Engineering, 1 role in Support]
Notes:
The funding round was led by Intel Capital, the corporate venture arm of Intel.
This has been billed as a strategic investment as Intel is spending close to $100b to develop its own manufacturing capacity and refurbish existing.
Subcontractors
Hero Software, a German startup, raised €40m in Series B funding. They have developed an operating system for trade business owners (e.g plumbing, carpentry, electrical) to manage their core workflows such as quotes, invoicing etc and help field workers to access relevant information on site. More here.
Building Decarbonization
Scaler, Dutch startup, raised $10m in Series A funding. They have developed a tool which helps with ESG monitoring and decarbonization for real estate investors and asset managers which models the impact of decisions at a building and asset wide level. This helps them to create roadmaps and order works such as retrofitting or installing heat pumps and solar panels. More here.
[View open jobs - 4 roles in Sales, 1 role in Operations, 2 roles in Software, 1 role in Support, 1 role in Marketing]
Notes:
The solution helps investors tackle the operational carbon footprint of their assets.
Real estate as an industry contributes to ~40% of global emissions with 70% from building operations and 30% from construction.
2% of existing buildings are able to be net-zero (don’t require retrofits).
Switchee, a London startup, raised £5m in funding. They provide smart thermostats for social housing which measures humidity, temperature and pressure and analyses data allowing residents to optimize and control their energy to lower heating bills and reduce mold. More here.
[View open jobs - 1 role in Operations, 1 role in Software, 2 roles in Support, 1 role in Marketing]
Orus Energy, a Parisian startup, raised €2.2m in pre-seed funding. Their software predicts a building's energy consumption and aggregates the flexibility of groups of buildings to shift energy usage to times when electricity is cheapest and greenest, using the thermal inertia of buildings and providing flexibility to the grid. More here.
[View open jobs - 1 role in Operations, 2 roles in Software, 1 role in Other]
Smart Cities
Hayden AI, an Oakland startup, raised $90m in Series C funding. They have developed a vision AI platform for smart cities using sensors mounted on vehicles to create an urban operating system with insights on sustainability, traffic safety and accessibility to improve decision making. More here.
[View open jobs - 13 roles in Software, 4 roles in Operations, 1 role in Product, 1 role in Other]
Notes:
The solution is used by cities and transit agencies such as New York’s MTA, Washington DC’s Metro, Los Angeles Metro and the East Bay’s AC Transit.
It is used for tasks such as detecting and enforcing parking and moving violations which obstruct public transportation and road safety.
Kodifly, a Hong Kong startup, raised $750K in funding. They are using AI to improve urban mobility and infrastructure resiliency by ingesting data from cameras and LiDAR to provide solutions for use cases such traffic management, pedestrian safety and environmental monitoring. More here.
[View open jobs - 2 roles in Design, 8 roles in Software, 2 roles in Finance, 2 roles in Project Management, 2 roles in Marketing, 2 roles in Sales]
Labor
Tough Leaf, a New York startup, raised $4.5m in Series A funding. Their platform helps to connect general contractors and developers with qualified business enterprises owned by minorities, women, veterans and other disadvantaged groups. More here (SEC filing).
Notes:
Tough Leaf’s search engine allows contractors to easily match with firms based on specific job requirements such as certifications, union status, insurance etc.
They vet the data to ensure that the firms which are provided as options have the qualifications and capabilities to carry out work provided.
BIM
Revizto, a Swiss company, received minority investment. They develop coordination software for the AEC industry allowing project stakeholders to work and communicate in a unified environment. More here.
[View open jobs - 2 roles in Support, 1 role in Marketing, 1 role in Operations, 2 roles in Sales]
Notes:
They service over 260,000 users with over 2,500 customers from firms such as AECOM, Jacobs, Arup and John Holland.
Industrial Decarbonization
KC8 Capture Technologies, an Australian startup, raised $10m in funding from investors including CEMEX Ventures. They have developed a carbon capture solution which captures 95% of CO2 emissions from heavy industrial sources including cement. More here.
Notes:
Funding will be used to build a commercial demonstration plant with Cement Australia to capture 15 tonnes per day of CO2.
Cemex is seeking to test the technology in a Front-End Engineering Design study at one of its cement plants aiming to capture more than 100 tons per day of CO2 (10x more than current project scopes).
Infrastructure Monitoring / Inspections
Arkion, a Swedish startup, raised $4m in funding. They have developed an AI powered asset intelligence platform helping grid operators to complete infrastructure inspections faster and more accurately. More here.
Notes:
For many of the startups building AI solutions, an issue they face is ensuring accurate and reliable data is captured and uploaded.
To overcome this problem Arkion partners with in-house operations teams or secures a trusted external partner to gather reliable data from overhead line inspections.
They provide guides on how to ensure quality data is collected whether by drone, helicopter or ground transport.
This is an interesting approach which avoids the need to develop and sell sensors to ensure data quality.
Seismos, a Texas startup, received $15m in funding. They develop AI powered acoustic sensing which provides insights for enclosed structures such as drill-holes and pipelines and can be used for activities such as monitoring of subsurface pipelines which have leaks and enabling predicting monitoring. More here.
[View open jobs - 1 role in Software, 1 role in Sales, 4 roles in Other]
Water
ZwitterCo, a Massachusetts startup, raised $58.4m in Series B funding. They develop membranes for water treatment which improve the membrane life and performance helping to minimize costs. More here.
[View open jobs - 1 role in Sales, 7 roles in Other]
Active Membranes, a Californian startup, raised seed funding (undisclosed). They have developed an electrically conducting membrane for use in desalination minimizing the use of chemicals and consumables. More here.
Materials
Aisti, a Finnish startup, raised €26m in funding. They have developed a sustainable acoustic tile using foam forming technology for wood fiber which can be used as a sustainable material alternative for buildings. More here.
Altrove, a Parisian startup, raised $4m in Pre-Seed funding. They have developed a proprietary characterisation technology which helps to develop sustainable alternatives to critical earth materials that are used in transition technologies such as wind turbines, solar panel and batteries. More here.
[View open jobs - 1 role in Other]
Notes:
Altrove’s solution is currently focused on developing alternatives to essential materials.
Unlike other AI material startups, they do not just predict what new material could exist, but focus on finding the recipe which allows for these materials to be manufactured on scale.
Their technology has a proprietary learning process which accelerates the discovery process up by 100x.
They have initially focused on rare earth materials given their critical need and growing global demand (expected to double by 2030).
This same solution and process could be applied to the discovery of new building materials.
Other
JigSpace, an Australian startup, raised $13m in funding. They transform CAD models into 3D presentations which can be used for sales, training and marketing materials. More here.
Notes:
Their product can be used to create presentations and interactions with the Apple Vision Pro.
It is likely that the software could be used to create immersive training for construction.
Policy and Regulatory Changes
Court halts Biden pause on new gas exports
In January, the Biden administration announced it would pause approvals of new permissions to ship natural gas abroad to countries that don’t have free trade with the U.S.
They stated they were doing the pause to update criteria on whether to approve new gas export terminals and if they should revamp the environmental consideration process.
A judge has halted the pause on new approvals for natural gas exports.
Notes:
The US is the world’s largest exporter of LNG and is on track to double its capacity by 2030.
This pause has an impact on construction of export facilities.
Changes coming to NYC construction safety, permitting
On Dec. 11, the definition of a major building in the city’s building code will change from 10 stories to 7, or 75 feet.
New builds, demolition or interior demolition with mechanical equipment of buildings over 7 stories, will require a site safety coordinator and approved site safety plan.
This will affect thousands of additional projects.
Federal infrastructure projects get a (flood) raise
From September 9, new projects and infrastructure rebuilt after disaster with Federal Emergency Management Agency funding must be elevated at least 2 feet above the area flood level.
USDOT issues NOFO for third round of Reconnecting Communities Pilot Program funding
The funding provides more than $600m for both capital construction and community planning grants.
The Reconnecting Communities Pilot Program reconnects communities that are cut off from opportunity and burdened by past transportation infrastructure decisions.
The program is covered under the Justice40 initiative which sets the goal that 40 percent of the overall benefits of certain federal investments flow to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution.
The Bill provides a discretionary total of $25.131 billion to the Department of Transportation, which is $1.856 billion below the FY24 enacted level and $336 million below the President’s Budget Request.
France Approves Flying Taxi Port on Seine River Barge
Aeroports de Paris SA, the French capital’s airport operator, can build a vertiport on the river near the Austerlitz railway station in central Paris.
It is opposed by the Paris City Hall which is taking legal action against the government’s authorization on grounds that the aircraft will create noise pollution, extra greenhouse emissions and excessive energy consumption.
Notes:
As Flying Taxi technology advances, there is a requirement for specialized infrastructure.
Deployment may be opposed by affected stakeholders on the grounds of noise and pollution.
NYC’s $16 Billion Gateway Tunnel Project Locks In Billions in Federal Funding
The Federal Transit Administration will invest close to $6.9 billion.
This is the largest grant ever signed by the agency.
A controversial housing law just hit SF. This is the first major project to take advantage
A notice of intent was filed to build a 23-story apartment building.
It takes advantage of Senate Bill 423 which fast tracks new housing.
It provides benefits such as bypassing discretionary hearings and waiving environmental reviews.
San Francisco was the first city subjected to SB 423’s new rules as it failed to meet its housing goals and has the longest housing approval timelines in the state.
USDA funding to support small hydropower construction
The US Department of Agriculture is partnering with rural Americans on clean energy projects to lower energy bills and access clean energy.
A recent announcement included $16.6 million to build a 3 MW hydroelectric plant on the Kentucky River.
Counties and states are ending single-family zoning. Homeowners are suing.
Lawmakers in Arlington County have completed a landmark zoning change which replaced local laws allowing only single-family houses in certain areas.
This change allows houses to be replaced with buildings containing multiple small apartments.
Homeowners are suing against the law which could dictate the future of single family only zoning.
Notes:
States and counties are enacting legislation to increase housing density and new home construction.
These are facing litigation in the courts and homeowners do not want their suburban zoning to change.
National Infrastructure Projects & Priorities
Global
How the investment world is trying to navigate geopolitics
It was noted that over the last 20-30 years geopolitics was deflationary and created lower risk whereas now it is likely to be inflationary and create more risk, impacting investments.
Mike Pompeo, former US Secretary of State, warned investors it has become “impossible to separate geopolitical risk from capital allocation.”
Some investment firms are bringing in geopolitical expertise, via in-house or outside consultants as politics influences corporate decision making.
Key concerns include US-China tensions, conflicts in Ukraine and the Middle East, and political instability in South America (Venezuela, Bolivia, and Ecuador).
Notes:
Geopolitical fragmentation is being seen as an important risk by large investors such as BlackRock.
This could have a downstream impact on financing and funding for infrastructure projects as well as implications on supply chain and the sourcing of materials.
US
Google’s emissions climb nearly 50% in five years due to AI energy demand
Google's greenhouse gas emissions have climbed 48% over the past five years despite committing to net zero by 2030.
Electricity consumption by data centers and supply chain emissions were cited as primary reasons for the increase.
Notes:
As mentioned in this issue, Microsoft is facing a similar emissions problem due to data centers.
The need for clean electricity could increase interest in nuclear as well as sustainable materials to decarbonize the supply chain and reduce embodied carbon.
BOEM Approves Construction and Operations Plan for New England Wind’s Offshore Wind Projects
The Bureau of Ocean Energy Management (BOEM) approved the construction and operation of two wind energy projects.
These will provide a capacity of up to 2,600 megawatts of clean, renewable energy that could power more than 900,000 homes each year.
The Biden-Harris administration has a goal of deploying 30 gigawatts of offshore wind energy capacity by 2030
American Airlines, ZeroAvia step up hydrogen partnership
American Airlines entered into a conditional purchase agreement with hydrogen fuel cell aviation upstart ZeroAvia for 100 hydrogen-electric engines.
This is to power regional jets with zero in flight emissions.
Notes:
The timeline for delivery of the jets is 2029.
This shows that hydrogen could be an alternative to electric powered planes.
It will require the construction of new hydrogen fuel infrastructure at airports.
Europe
Shell pauses construction at one of Europe’s biggest biofuels plants
The plant is intended to convert waste into jet fuel and biodiesel.
Shell is temporarily pausing to address project delivery and ‘ensure future competitiveness given current market conditions.’
Notes:
Europe’s biofuels market has had weak demand growth and is under pressure from oversupply.
This could impact related construction projects in the near term.
Europe’s largest renewable producer scales back plans for wind and solar plants
Stratkaft is scaling back plans to build new wind and solar plants because of lower electricity prices and higher costs.
China
China Three Gorges Renewables to build 8GW solar PV project in Inner Mongolia
They will invest RMB79.8 billion (US$10.98 billion) in the energy project, taking a 56% stake.
The plan is to build an 8GW solar PV project which will be part of a proposed large-scale energy project also housing 4GW of wind, 4GW of coal-fired power and 5GWh of battery energy storage.
Russia
Uzbekistan SMR plant construction preparations under way
A contract for the delivery of a 6 unit small modular reactor nuclear power plant has been signed.
It is the first export order for Russia’s SMR. The land based version is currently being built in Yakut in Russia.
Turkey
China's BYD, world's biggest EV maker, invests $1B in Turkish plant
The EU increased tariffs on Chinese EVs in order to safeguard the competitiveness of the bloc’s automotive industry.
BYD now faces an additional 17.4% tariff on top of existing 10% import duty on its vehicles shipped to the EU.
Turkey is exempt from the tariffs and the new plant will allow BYD to make cars there and then export them to the bloc without the tariffs.
Notes:
Geopolitics continues to influence infrastructure investment globally.
Investment Funds
Xylem, a Washington company which provides global water technology has announced expansion of their corporate venture unit with an additional $50m. More here.
Notes:
They aim to support emerging companies and water services providers which solve critical climate challenges such as water scarcity, quality, and decarbonization.
Acquisitions
Buildvision, a construction supply chain platform (raised $3m in May), has acquired SpecFrog, a startup which used AI for automated specification comparisons. More here.
Holcim, a Global building material provider, acquired Mark Desmedt, a Beligan recycler of construction demolition materials. More here.
News
India’s Building Construction Industry in FY 2023-24: A Zone-Wise Analysis – Part 1 of 7
India’s construction industry is to become the world’s third-largest construction market within the next 3 years.
Overall construction value is projected to reach USD 1.4 trillion by 2025.
In 2023, India’s construction sector was the 6th largest recipient of Foreign Direct Investments (FDI).
German firm Nemetschek Group steps up operations in India
The group provides software solutions for architecture, engineering, construction (AEC) and media industries.
They have announced expansion into the Indian market with their efficiency enhancing offerings.
Nexii Building Solutions saga ends with bankruptcy sale
The green building company once had a valuation of $2b.
Why has U.S. manufacturing productivity stagnated for over a decade?
The article has 4 hypothesis which it discusses and provides both sides on including:
U.S. manufacturers don’t buy enough machinery.
The sector is too concentrated.
The U.S. doesn’t export enough
The end of the rainbow
This is the hypothesis that productivity growth depends on key innovations such as chemistry, electricity or steam powered (and other) and these have now been mostly fully exploited.
Notes:
Manufacturing construction is growing due to government incentives and funding.
Understanding the industry dynamics can be valuable in winning work and delivering effectively to this customer segment.
Bikies, underworld figures and the CFMEU takeover of construction
The article is related to the construction union in Australia.
This may have an impact on the deployment and funding of new infrastructure projects in the short term.
GPS runs the modern world.
The US is lagging behind with many satellites exceeding the designed lifespan of 8 to 15 years.
If it fails, critical systems such as mobile networks, power and ambulances would no longer function effectively.
Other countries such as China are building backup systems such as timing stations which broadcast signals and are laying 12,000 miles of fiber-optic cables that can provide time and navigation without satellites.
How to Design a Corporate Venture Studio
If I missed anything this week, please reply and let me know! I’ll make sure to include it next week.