- A CB Insights study found that a record number of construction tech investments by corporate venture funds in the third quarter of 2020.
- One unlikely major investor is Salesforce, which has invested in multiple construction project management and progress tracking companies.
- Project management and collaboration is a major trend for investment in 2020 as many construction companies have had to learn how to operate more remotely.
- Visit Business Insider’s homepage for more stories.
The number of corporate investments into construction tech startups reached an all-time high in the third quarter of 2020, as investment rebounded after a coronavirus dip.
Major companies, many investing through their venture capital units, made 16 construction-tech bets in the third quarter of 2020, while in the first quarter, they invested only twice.
Corporate investors of construction tech companies are often real estate or construction companies that are looking to gain a technical edge through investing in cutting-edge technology, but a CB Insight report published this Thursday found that over the last five years, some of the most active investors in the category are seeming outsiders like Salesforce and banks.
The report also noted that project management and collaboration construction tech companies have been the “greatest focus area for corporate investors” in 2020. This is unsurprising in a year where, like in many other industries, parts of the construction industry had to embrace remote work.
The top investor is Autodesk, the construction and design software company, which has invested in 10 construction tech companies, ranging from 3D data modeling company Assemble Systems to modular housing manufacturer Factory OS. The company also tied for the most acquisitions in the time period with infrastructure software company Bentley Systems.
The other players are a bit more surprising.
The venture arms of Salesforce and Mexican building material manufacturer Cemex are tied for the second-most corporate investments in construction tech, while the fourth and fifth most active corporate investors are the venture arms of Japanese bank SMBC and German bank Berliner Volksbank.
Salesforce’s investments may seem to be far afield from the company’s work developing CRM software and analytics programs. However, a closer look shows that six of the seven investments it has made are in software companies that develop project management, collaboration, and progress tracking tools not dissimilar from its flagship products—they’re just applied directly to construction.
Salesforce has invested in project management software company ANDPAD twice this year, investing in the company’s $37.3 million Series C in July and its $18.8 million Series C add on in October. It made its first investment in the Japanese startup in 2019.
The company has also invested twice in Bridgit, a construction resource management software, and one in progress tracking software FINALCAD and drone intelligence company Kespry.
Salesforce’s 2020 investments in project management tools like ANDPAD and Bridgit are part of a broader trend towards corporates investing in project management software, according to the report.
The firms getting the most money from corporate investors
OpenSpace, which uses hardhat mounted cameras to track progress and provide analytics on the job site, was another highlight in project management funding. The company raised $15.9 million in a Series B in July.
The company’s Series B round included funding from JLL Spark, the corporate investment arm of real estate services firm JLL. Previous rounds included investments from WeWork, commercial real estate owner and developer Tishman Speyer Properties, and construction management firm Suffolk Construction.
The report also tallied the construction tech companies with the most corporate backers, an indicator that real estate and construction companies are excited and looking to access the company’s services much more directly than just as a customer.
Honest Buildings, a platform that real estate developers can use to track construction, leads the pack with investments from multiple major real estate companies, like Rudin and the Durst Organization. The company was acquired in 2019 by construction project management giant Procore.