Last Week in ConTech - 21 October 2024
Climate tech startups are secretly vertical construction companies + building a classification system for ConTech startups
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:
11 Startup Fundings
9 Policy and Regulatory Changes
1 US election policy updates
7 New National Infrastructure Projects & Priorities
0 New investment fund
0 Acquisition
6 News articles
32 new jobs posted - view here
Reading time: 15 mins
A number of people have reached out to me regarding finding ConTech jobs. Every week, I save the open jobs for the companies which are featured in the newsletter here. Hope this helps anyone who is looking!
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Startup Funding
Green Materials
Concretene, a UK startup, raised £3m in funding. They have developed a graphene enhanced admixture for concrete to reduce the carbon footprint. More here.
Circuland, a London startup, raised €750k in Pre-seed funding. They develop Digital Material Passports which act as a lifecycle record for construction materials supporting their reuse, recovery of value and the elimination of waste. More here.
[View open jobs - 1 role in Sales, 1 role in Operations, 1 role in Software]
Notes:
The EU is implementing legislation for Digital Product Passports (DPP).
These are digital records which provide comprehensive information about a product and its entire value chain including everything from the origin of the product, materials used, environment impact and disposal recommendations.
They will be valuable in construction as it will allow material reuse.
Currently if a material is removed from construction it generally isn’t reused due to risk - we don’t have traceability to know how long it has been in the building (e.g is it a new addition - 1 year or 5 years old) and how structurally sound it is (tests can be conducted but insurance can be an issue).
Having product passports allows for the building to be used as a ‘material bank.’
This solution is buoyed by a target from the Greater London Authority to reuse or recycle 20% of the whole building by value for all major developments.
EnviCore, a Canadian startup, raised CAD$4.2m. They produce sustainable supplementary cementitious materials from recycled and natural mineral feedstock to reduce carbon in the cement production. More here.
[View open jobs - 1 role in Sales]
Porous Lane, an Australian startup, raised funding (undisclosed). They are commercializing a highly permeable, eco-friendly pavement which captures and recycles water. More here.
[View open jobs - 1 role in Sales]
3D Printing
14Trees, a Swiss startup, raised Series A1 funding (undisclosed). They have developed 3D printing technology which is affordable, mobile, and capable of printing two-story buildings and have delivered projects such as the world’s first 3D printed school and the largest affordable housing project. More here.
Notes:
14Trees is a joint venture between Holcim and British International Investment and Amazon’s Climate Pledge Fund.
Inspections
Lamarr.AI, an Atalanta startup, raised $1.1m in Pre-Seed funding. They use drones, thermal imaging and AI for building exterior inspection automatically identifying problems like deteriorated window seals and leaky roofs helping owners save money on engineering and construction costs. More here.
Energetic Renovations
Wallround, a Berlin startup, raised funding (undisclosed). They develop a digital platform which simplifies the process of property renovations for landlords focusing on energy efficiency and decarbonization in the renovation process. More here.
Notes:
Wallround offers landlords a vertically integrated energy renovation solution for a building envelope (roof, windows and facade).
This is from first enquiry, to energy consulting, funding / grant application management, project management of the entire process to the structural implementation of the renovation.
As I mentioned last week, these companies which tend to be called ‘climate tech’ solutions so that they can receive funding from VCs with climate mandates, are actually vertically integrated construction companies combining the design and construction phase.
This is interesting as these solutions seem to target the residential (including multifamily) sector.
It could be that this owner / landlord desires an integrated and guided construction process given the scale and size of the projects.
For commercial buildings (offices), the landlords tend to have dedicated construction / project management talent in house.
As these people have specialized expertise and knowledge, to control costs they are more likely to use the more traditional ‘design-bid-build’ method for project delivery and don’t require the guidance from a vertically integrated company (plus the renovation could be more complex and less standardized).
Treehouse, a San Francisco startup, raised $16.6m in Series A funding. They provide a software enabled installation platform for electrification projects such as EV charging and home electrification to support decarbonization. More here.
[View open jobs - 1 role in Customer Success, 2 roles in Project Management]
Notes:
Treehouse self describes itself as an ‘Electrical contractor for the 21st century.’
It again appears that Treehouse is a tech enabled vertical construction company.
They allow homeowners to enter details on their project, provide quick estimates and, as a contractor, can complete the work.
The question then becomes, why are construction companies receiving venture capital funding?
My thesis behind this is formed by reading
’s Vertical Integrator series.The previous tech winners of the early 2000 were SaaS companies but the future tech winners will look more like vertically-integrated, complex monopolies which people built in the Second Industrial Revolution - think Standard Oil not Salesforce.
A reason for this is by looking at the case study of Ento (from his article).
They were a SaaS platform which used data science to help blue-collar businesses with shift-based workforces better track, schedule, and balance their labor…
The software produced 8-15% efficiency gains for its customers which is decent…except that they should have theoretically produced 50-60% gains…
The problem is, you can sell a company software, but you can’t force them to use it to its fullest extent.
But what if you owned the company (like Treehouse)?
Instead of selling a SaaS to an industry that won’t fully adopt the software, build a vertical integrator which adopts your own solution to the fullest extent allowing you to self perform at higher quality and lower cost.
It’s becoming more and more common (Roofer.com is another example which I broke down here) and VC’s see a massive opportunity - the residential energetic renovation market classed as ‘poor energy rating’ and requiring urgent renovation is worth €390b in the EU.
Weather
Perry Weather, a Texas startup, raised $15m in Series B funding. They provide a platform monitoring weather conditions and simplifying weather safety decisions. It’s used by construction firms to receive precise, location based weather information and automatic alerts aligned to their weather guidelines. More here.
[View open jobs - 1 role in Customer Success, 3 roles in Sales]
Notes:
An example use case would be for a concrete pour.
The specification may list the minimum and maximum temperatures allowed for concrete to be poured.
If the weather is predicted to be outside these ranges, contractors receive notifications allowing them to update the schedule and rebook the subcontractors.
Asset Management / Supply Chain
Mongoto, a San Francisco startup, raised $27m in Series A funding. They have developed a platform which enables businesses to manage and scale Internet of Things devices globally offering a service which connects to over 550 networks across 180+ countries through one protocol. More here.
Notes:
This is a key enabling technology for IoT supply chain tracking solutions.
For example, this solution has been used to track and manage thousands of cattle with little trackers on their ears roaming across plains covered by a mix of network technologies.
Applying to construction, if we were to place an IoT trackers on a window built in a factory in China we could potentially accurately track its movement to an Australian job site.
This would allow us to have an up to date schedule and immediately be informed of delays.
This was challenging previously as network coverage changes across geographical zones.
Renewable Energy
King Energy, a Colorado startup, raised $10m in funding. They rent unused roof or parking lot space at commercial buildings and install solar panels generating revenue by selling the energy to the building tenants. More here.
[View open jobs - 1 role in Sales]
Notes:
These solutions are interesting as they are receiving support from shifting regulation.
Two weeks ago, New York City approved legislation mandating solar panels on public buildings.
King Energy provides a way of meeting the regulation at no cost to the building owner.
Increasingly as technology is commoditized (solar panels are cheap), the companies winning have unique business models / financing offerings to customers.
This is as the challenge has shifted from technology to installation and a trend I’ve noticed is that residential clean energy generation companies are tending to vertically integrate, selling the solution, installing the solution and maintaining it.
This allows them to capture revenue from the full lifecycle of operation instead of just the initial solar panel sale.
Similar offerings appear to be rising for net zero construction site solutions e.g. companies offering financing or rental of electric or hydrogen generators as well as designing microgrids to help construction projects decarbonize.
Examples of this include Instagrid or Skoon.Energy.
Policy and Regulatory Changes
State and local governments have pledged to adopt cleaner construction materials in infrastructure projects. It includes:
New York State committed to reduce carbon emissions from concrete used in the state’s infrastructure projects by 30% by 2028.
The City of Los Angeles committed to new 15% emissions reduction targets for construction materials in all of the city’s infrastructure projects
Real estate firms committed to using cleaner materials in their buildings. This includes:
BXP (Boston Properties), the largest publicly traded real estate developer in the country, pledged by December 2025 it would purchase concrete with 15% lower emissions.
Turner Construction Company, the largest general builder in the country, will by 2026 implement at least five demonstration projects using concrete with 50% lower emissions.
Denver updating energy efficiency regulations for large buildings
Owners of buildings larger than 25,000 square feet can face up to $4.5 million in fines.
This could occur if they ignore or refuse to comply with Denver’s plan to achieve “net zero” carbon emissions intended to eliminate the use of natural gas citywide by 2040.
Denver City Council adopted a new building code in 2021.
The ordinance requires buildings larger than 25,000 square feet to get to 30% energy savings by 2030.
The ordinance also requires adoption of electric heating and cooling systems to replace gas systems over time.
Biden admin awards $2B in new grid resilience grants
38 projects received grants across 42 states.
The DOE forecasts the projects will boost transmission capacity by more than 7.5 GW and catalyze a total of $4.2 billion in public and private-sector investment.
13 green infrastructure projects get $60M across New York
The funds will support the construction of infrastructure such as porous pavement, small pocket parks and tree trenches which are rows of trees connected by an underground stormwater infiltration system.
How the White House influences transportation grantmaking
A report found that Presidential administrations influence which transportation projects get funded.
The Obama administration favored transit projects while the Trump administration prioritized road expansion
Researchers studied more than 1,200 projects awarded a combined total of over $16 billion from 2009 through 2024.
City governments received 38% of these grants while states accounted for 21% of awarded grants.
Türkiye drafting law to facilitate building small modular reactors
Türkiye plans to build at least three nuclear power plants for 15,000 megawatts (MW) of nuclear generation capacity.
It aims to complement conventional nuclear plants with up to 5,000 MW of SMRs to diversify its electricity production mix.
Building codes led North Carolina to lose out on $70M in disaster prep funds, state says
This can be partially attributed to the state's building codes, which by design, only implement new standards years after they are adopted at the international level.
In 2014, the state’s Building Code Council voted to move to a six-year revision cycle.
This means North Carolina is set to adopt the 2018 building code standards in January 2025, after which the state law will not require another update until 2031.
These delays put North Carolina behind most other coastal states vying for flood mitigation projects.
New York Power Authority seeks up to 575 MW of renewables for NYC
The New York Power Authority issued a request for proposals for renewable energy to deliver energy through the existing 660-MW Hudson Transmission Project.
New York has set a goal to develop a zero-emission electricity sector by 2040.
This includes delivering 70% renewables by 2030 and an economy-wide carbon neutrality by 2050.
Maryland DOT plans transit-oriented development along commuter rail line
The plan offers recommendations on developing 170 acres of undeveloped state-owned land around six train stations.
It will create at least 2,600 new housing units to help address the state’s housing shortage.
More Power, More Water: Solar-Over-Canal Projects Are Coming to California
California is undertaking pilot projects to place solar panels over water canals.
This allows them to generate clean energy while reducing water evaporation.
Almost 60% of California’s electricity comes from clean capacity, having built 35 GW and increased battery storage by 757% in four years.
Tribal nations want utility-scale clean energy, but upfront costs pose a barrier (US)
The Inflation Reduction Act has supported the development of clean energy projects.
However the interconnection queues remain backlogged.
A grid interconnection ties a network of local grids together at a synchronized frequency allowing the exchange of energy from local grids with surplus power to those having higher demand.
The Federal Energy Regulatory Commission can require a $5m commercial readiness deposit for projects to remain in an interconnection queue.
US election policy updates
Where the 2024 presidential candidates stand on construction’s top issues
The article summarizes down the candidates' views across energy, environment, immigration (can affect construction labor shortages), infrastructure, supply chain and others.
Donald Trump praises Elon Musk, but vows to end America's electric vehicle mandate ‘on Day 1’
In 2021, President Joe Biden set a goal for half of all new cars and trucks sold by 2030 to be zero-emission.
Trump underscored the importance of giving Americans the freedom to choose what type of vehicle they drive stating “I will end the electric mandate on Day 1 of the administration.”
Notes:
This could have impacts on manufacturing facilities construction.
National Infrastructure Projects & Priorities
US
Ørsted switches on 1.2 GWh Arizona battery
Ørsted, Denmark’s largest power provider and wind project developer and US utility Salt River Project (SRP) have switched on the Eleven Mile Solar Center, a 300 MW solar project.
The project represents an ~$1b investment in clean energy.
It’s part of Ørsted’s $20b investment in US energy generation projects.
Puerto Rico closes $861M DOE loan guarantee for huge solar, battery project
The loan will fund Puerto Rico’s largest utility-scale solar and battery storage installation.
The solar plants combined will have 200 megawatts of solar capacity while the battery systems are expected to provide up to 285 megawatts of storage capacity.
China
China's strategic infrastructure diplomacy in the Middle East
Infrastructure development serves as a soft-power tool, fostering goodwill and creating long-term dependencies.
For the states receiving support, it represents a lifeline, enabling them to pursue ambitious development goals without the stringent political conditions often imposed by Western nations or international institutions.
Notes:
Global power politics is influencing the development of infrastructure in emerging economies.
India
India Unveils $109 Billion Transmission Plan for Green Power
The project will help integrate 500 gigawatts of renewable power by 2030.
It then expects to install another 100 GW from 2030 to 2032
India also plans to increase their transmission capacity by 35% by 2032.
Notes:
Transmission constraints have emerged as a key obstacle for the growth of renewable energy across the world.
In the US alone, almost 1.6 terawatts of planned renewable power generation projects and more than one terawatt of energy storage are actively seeking connection to the grid.
India's Renewable Energy Capacity Hits 200 GW Milestone
The total renewable energy-based electricity generation capacity now stands at 201.45 GW.
Renewable energy now constitutes 46.3% of total capacity.
Google announced that it has signed a deal with nuclear startup Kairos Power to build seven small reactors to supply electricity to its data centers.
The agreement promises to add ~500 megawatts of carbon-free electricity.
It adds to Google's more than 115 existing agreements for power from renewables and storage, which total over 14 gigawatts of capacity.
Notes:
Google now joins Microsoft and Amazon in using nuclear power to power data centers.
In September Microsoft announced it would pay Constellation Energy to restart a reactor at Three Mile Island.
In March Amazon said it would directly connect a data center to a nuclear plant in Pennsylvania
Amazon signs agreements for innovative nuclear energy projects to address growing energy demands
Amazon announced they’ve signed three new agreements to support the development of nuclear energy projects.
One agreement with Energy Northwest will enable the development of four advanced SMRs.
The reactors will be constructed, owned and operated by Energy Northwest.
Notes:
Energy-intensive generative AI applications and data centers are expected to account for roughly 9% of total US power consumption by 2030.
Only two SMRs currently operate in the world, in China and Russia.
News
Construction Standardization: The Demand-Shaping Paradox (Patric Hellerman)
The article explains how standardization of materials occurs in construction.
It highlights that every sector standardizes supply based on the smallest unit of repeatable demand.
In construction, standardization isn’t about buildings or rooms, it occurs at the basic component level - bricks, cement, two-by-fours, glass, paint, rebar.
These are standardized units that can be used in virtually any project, regardless of the final design.
AI and your Org Chart (KP Reddy)
This article breaks down how AI and ‘Agents’ could transform organizational structures in construction.
Q3 2024 Industry Insights: Contech & Cleantech (CEMEX Ventures)
From July to September, investments totaled US$734 million over 85 deals.
Notes:
Last week I calculated the cumulative funding for startups which have been featured on this newsletter over the last 2 months. This came to just over $1.4b.
This is a large discrepancy between the data and I assume the reason is based on our framing and definition (I can’t speak to how they define construction tech as I haven’t seen their database).
If you read the newsletter (and got this far!) you’ll notice that it provides a broader list of solutions than what is traditionally considered 'Construction Tech.'
The reason why is the goal of the newsletter is to increase the awareness and adoption of solutions within the construction industry to improve the way we build.
As such, the target persona is the innovation manager.
Innovation managers act as the 'triage nurses' of the construction industry.
When a startup pitches a solution, they quickly review the deck to assess if and where it could be valuable to their organization, facilitating conversations / pilots.
Alternatively, if there is an internal pain point, they are often tasked with identifying potential solutions.
From what I’ve seen, innovation managers don’t limit themselves to adopting only 'construction tech' solutions - if a solution has clear value, it will be used.
This is because construction isn’t an industry; rather, it’s a set of activities and processes that apply across many sectors.
When faced with a challenge, innovation managers first work to understand the project team’s problem and process.
If an external solution is required, they’ll search their solution database for potential matches.
They may start by filtering for 'Construction Tech' solutions, but if none exist, they explore adjacent industries like manufacturing or logistics.
An example adjacent solution is Weavix:
They make smart radios for frontline workers, and would be tagged as a 'Workforce Management' (or 'HardTech') solution, not traditional 'Construction Tech.'
Despite this, Weavix has gained traction in construction due to features like group alerts, live location, video messaging, and private networks that improve site safety.
My belief is that innovation managers need awareness of solutions that provide value to construction processes.
To support this, I’ve been building a classification framework to explain how I filter and include startups in this newsletter.
I use this framework to help identify if a solution could be applicable or adaptable to the construction environment.
I’ll be sharing it soon for feedback to refine and better target the content.
Switzerland puts Sun-Ways technology on the rails
The technology installs solar panels in the unused space between two rails of a railroad track.
They use a machine which can install 1000m2 of solar panels each day.
Data Centers Unplugged: Physical Assets for the Digital Economy (Ironspring Ventures)
The article focuses on the growth of data centers and the industrial supply chain required to design, build, and operate them.
America’s New Millionaire Class: Plumbers and HVAC Entrepreneurs
Private-equity investors have purchased nearly 800 HVAC, plumbing and electrical companies since 2022.
Alpine, an early investor in HVAC companies, has rolled up more than 200 companies across 43 states into a larger service platform, Apex.
It did a combined $2.2 billion in business in the past year.
If I missed anything this week, please reply and let me know! I’ll make sure to include it next week.