Contractors Dive into Venture Investing with Established Startups

Builders are increasingly turning to venture investing in construction, focusing on established startups with commercial-ready solutions. Contractors are launching their own venture funding arms, such as DPR Construction's WND Ventures and Suffolk Technologies' BOOST incubator program, and investing in startups like Canvas, which creates robots to help with drywall finishing. Funding rounds can be seen as a maturity indicator, with pre-seed rounds indicating infancy and Seed funding being a starting point.

Builders are increasingly turning to venture investing in construction, focusing on established startups with commercial-ready solutions. Contractors are launching their own venture funding arms, such as DPR Construction's WND Ventures and Suffolk Technologies' BOOST incubator program, and investing in startups like Canvas, which creates robots to help with drywall finishing.

Funding rounds can be seen as a maturity indicator, with pre-seed rounds indicating infancy and Seed funding being a starting point. Construction Series B deals are on the rise, indicating the growing maturity and stability of these startups. For example, Buildots, based in Tel Aviv, Israel, completed a $45 million Series D funding round in May, bringing its total capital raised to $166 million [1].

Major players like DPR Construction, Suffolk Technologies, and Turner Construction are actively investing in these startups. DPR Construction's WND Ventures, for instance, has invested in established startups such as DroneDeploy, Trunk Tools, and Dusty Robotics. Similarly, Suffolk Technologies' BOOST incubator program has featured 36 different startups, investing $100,000 in each through a post-money SAFE agreement [1].

The broader venture capital landscape is flush with cash, with global venture funding reaching $321 billion in 2024, doubling over the last decade. However, construction technology (contech) makes up a more diminutive portion of the total, with the sector managing to pull $3.1 billion in 2024 following a sharp downturn in 2023 [1].

Construction, despite its reputation for lagging behind other industries in technology adoption, is ripe with opportunity. Experts predict that 2025 will be a transitional year for understanding where technology investments need to be made. The AI boom is a significant driver of this trend, with investors pumping $521 million into AI-based contech offerings in the first quarter of 2025 [1].

Contractors are seeking solutions to address labor shortages, environmental unpredictability, and cash bottlenecks. For instance, Gilbane Building Co. used Trunk Tools to track around 21,000 discrete documents on a $456 million renovation project, saving money. Similarly, Zachry Construction used Alice Technologies to speed up its estimating process, saving 28 days on a $149 million highway project [1].

Experts like Dan Laboe of Nymbl Ventures and Gonzalo Galindo of Cemex Ventures emphasize the importance of identifying viable solutions that are ready for commercial deployment. Laboe notes that startups are beginning to realize that there are no disruptions in this space, but rather a slow transformation into the future. Galindo points out that firms that make it to the Series B stage have shown resilience and business acumen, making them more attractive to investors [1].

The future of construction technology investment looks promising, with a growing trend of contractors investing in commercially ready solutions. This trend is expected to continue, driven by the AI boom and the increasing need for innovative solutions in the construction industry.

References:
[1] https://www.constructiondive.com/news/construction-technology-funding-maturity-startup/753108/