“Construction is one of the least digitized industries…”
That’s according to Michael Wholey, an intelligence analyst for CB Insights, a firm that specializes in machine learning. Speaking to Curbed.com, Wholey describes how “many startups are seizing the opportunity to build technology that would increase efficiency within this market… As a result, funding and deal activity in the construction technology space has been increasing steadily over the past few years.” In fact, CB Insights estimates that $1.4 billion has already been invested in the global industry in 2018 alone! That’s an eye-popping number, so today we’re examining the explosive growth potential in the construction industry!!
What’s new in technology is a popular topic on the Equipment Trader blog. It’s fun to write about, and readers always seem interested, whether they’re builders, farmers, or other technicians who might one day use new tech, or dealers who might one day sell it. A sampling of past topics include:
- Self-Driving Equipment
- 3D Construction Printing
- Mixed Reality Hard Hats
- Data, Drones, & Robotics
- Getting Employees to Buy-In to New Technology
- How Technology Can Influence Sales Pitches
- Digital Advertising
It’s amazing that there’s so much new technology to talk about, and we haven’t even scratched the surface! And now, venture capitalists and investors are taking notice and betting big on architecture, engineering, and construction start-ups. Crunchbase.com estimates that funding for North American construction tech start-ups grew by a whopping 318% between 2013 and 2017, from $183 million to $582 million.
The most promising areas for technological improvement and investment within construction, according to global consulting firm, McKinsey, are in field productivity and site management. This makes sense; our industry, after all, can be known for unexpected setbacks, delays, and wasted resources, despite the best efforts of experienced professionals. With tech that facilitates collaboration, conducts constant analysis, optimizes workflow, and boosts safety, there is enormous potential for improved efficiency and maximized profits.
In fact, as described in the Curbed article, construction’s traditionally low growth in productivity is why investors see such potential for improvement via new technological solutions. Construction dramatically lags behind the progress of other industries, but closing the gap could result in an additional $1.6 TRILLION (yes, that’s “trillion” with a “T”) to the global industry’s annual output.
At the end of the day, it’s clear that our dynamic industry may be in the early stages of a major, disruptive influx of revolutionary new technology. As dollar-signs accelerate progress faster and faster, it will be fascinating to watch construction evolve over the coming years. How workers build and repair will change. The equipment and products that dealers sell will change. We can’t help but wonder if everyone in the industry is ready for all that innovation. But ready or not, investors see explosive growth potential in construction, so change is on its way.
What do you think about all this money pouring into construction technology start-ups? Is it exciting? Or is it too much, too fast? Let us know what you think in the comments below!!