Despite Covid, Built Worlds Venture Investing Tops $350 Million in Second Quarter

Second Quarter Update on the Pace of Investing

Despite concerns about the industry’s performance in the post Covid economy, investment in Built World start ups seems to running at an even faster pace than in the second quarter of last year. On our Top Deals of 2019 List, we identified $108 million in deals closed in the second quarter of last year. This year, with the second quarter not yet complete, we have seen more than $350 million in deals closed, at least one exit, and additional investments where amounts were not disclosed. With the addition of several deals in which terms were not disclosed, it is likely the total investment in the sector for the quarter is at least $400 million. That would be the fastest pace of investment in the Buildings and Infrastructure Sector since the fourth quarter of 2018 when Autodesk announced its purchases of BuildingConnected and Plangrid for a total of more than a billion dollars. (We chronicled this period of acquisitions by Autodesk, Trimble, and Oracle In our February 2019 report  M&A Activity Spells a New Future for the Built World )

In this briefing, we tracked more than fourteen deals and the associated investors to gain more of sense of the themes at play and the players involved.   Below is the list of companies we identified that raised money or exited in the second quarter of this year in the Buildings and Infrastructure Technology Sector:

April Transactions

Aurigo – On April 14th Autodesk announced it would take a minority stake in the platform for construction management solutions for public and private owners of infrastructure.

EnVerid Systems – Breakthrough Energy Ventures led a $20 million series B, along with Building Ventures, Ajax Strategies and OurCrowd in this system that reduces HVAC Energy loads while improving indoor air quality.

IFM Restoration – The Residential Rental Property Maintenance platfom Raised $10 million in a funding round led by Brick & Mortar Venture and S3 Ventures

Livly – Multifamily residential community for residents and property managers raised $8 million from Geolo Capital, OCA Ventures, and Founder Equity as well as strategic investors in the sector.

PROCORE – According to a report by Bloomberg and others, Project Management Platform, PROCORE postponed its IPO and instead raised $150 million privately from existing as well as new investors.

May Transactions

Archistar – Generative Residential Design Platform raised $6 million Series A from Airtree Ventures to fund expansion into the US and Uk.

Briq – Blackhorn Ventures led $10 million round into this blockchain based construction intelligence platform.

Join – Preconstruction planning app garnered a follow-on round led by Building Ventures.

Northspyre – Project Delivery software company focused more on owners and project managers raised $7.5 million in a series A funding led by Craft Ventures.

Quartz –  Quartz raised $7.75 million to fund construction safety and productivity improvements through perception technology. Baseline Ventures led the round.

June Transactions

Headlight – Infrastructure Start-Up raises $25.6 million series B in round led by Viking Global Investors

Notevault – Voice enabled field management app acquired by Bentley.

Presecient – Off Site Design Builder raised $90 million round  led by Eldridge.

Tradehounds – Recruiting platform and community aimed at tradespeople raised $3.2 million from Brick & Mortar Ventures, Suffolk, Corigin Ventures, and CCS Construction Staffing.

Why the Pace of Deals?

On the one hand, one might argue that record money has been raised to invest in the sector, and that money has to be invested. So, it is logical that more money would be invested. Additionally, it is certain that many of these deals were in advanced phases of discussion prior to the onset of the worst of the global pandemic. Nonetheless, the deals were likely closed after the associated investors had seen that Covid 19 would have profound affects on our industry and the world, in general. That, notwithstanding, they moved forward on the deals.  BuiltWorlds own research on investor sentiment indicated that investors were divided on whether the pace of investment would decrease as a result of the Covid pandemic, with roughly 50% seeing a decrease in investment. Perhaps the third quarter will be more telling as we gage investors appetite for entering new deal discussions this year. In the meantime, however, the industry will continue to be awash in freshly funded or refunded solutions.