$1.58T is spent annually in the U.S. construction industry, yet it’s one of the least digitized industries in the world. Paralleling the shift to digital transformation across other industries, this is beginning to change. That’s just one reason we are delighted to announce that TCV is partnering with construction finance cloud leader: Built Technologies.
Construction may be one of the least digitized industries, but that’s not going to last for long. Builders and owners are expecting digital services, just as they do in all other aspects of their lives. When it comes to financing a construction project, customers around the world should expect seamless communication, payments, and procurement through the convenience of their phone. That’s why we are excited to invest in Built, who is seeking to upgrade the functionality and user experience for everyone in the construction value chain.
Nashville, Tennessee-based Built offers a cloud-based platform solution for construction lenders, owners, developers, and contractors. Its software acts as a digital workspace to allow all parties to collaborate to get projects built and keep capital flowing to the proper destination. The software is used by more than 150 of the leading U.S. and Canadian construction lenders, in addition to thousands of developers and contractors.
Built is closely following TCV’s thesis for SaaS as a Network – combining software + payments + marketplace, and connecting all key stakeholders on one platform. SaaS as a Network is a strong model for industries lagging in digital adoption, as products are focused on driving solutions, operational enablement, and strong ROI. We’ve seen this at Toast in the restaurant space – where Toast helps businesses operate more efficiently and grow revenue by providing payments, software and services, or with Clio, where law firms are able to manage their employees, and customers, and enable payments.
We believe SaaS as a Network is markedly increasing the possible expected return and economic strength of vertical sector-serving SaaS platforms, given it takes advantage of end-to-end workflows to build “rails” direct to their merchant’s customers, suppliers, and employees.
When a SaaS provider starts serving a high enough density of merchants, it can leverage that strength to build two-sided marketplaces with the merchant’s customers, suppliers, and employees. That SaaS vendor has now created a marketplace that can enjoy powerful network effects as seen in consumer marketplaces like Airbnb and Amazon.
Built’s platform started with a Construction Loan Administration offering that improves communication and operations between banks and their borrowers. Built has grown this offering to over 150 lender customers, representing more than $80 billion of unique construction dollars and is the system of record for these lenders’ construction portfolios. In addition, builders use this system to access their capital—the lifeblood of construction.
By following the flow of money from banks into the hands of builders and owners, the Built team realized there was an even bigger opportunity within the construction ecosystem. They started to build more products around payments and value-added services like on-site inspections and other critical support to enable the construction loan process.
Built was able to accomplish all this due to its product-driven team, led by CEO, Chase Gilbert, who has construction industry experience and understands the real-world buyer pain points. In addition, Chase and the Built team have taken a customer-centric approach that informs everything that they do, especially product design. As we spent time with customers, one of the key themes we kept hearing was the operational efficiencies that Built enabled. All stakeholders involved with the Built platform felt that they were able to operate better through their use of Built.
Since its 2015 launch, the platform has been used to manage the financing of over $135 billion in construction, spanning more than 200,000 commercial, homebuilder, land development and consumer residential projects. All these were factors that led to TCV being the lead investor in Built’s $125 million Series D funding round.
TCV first called on Built in 2017, and our team took the time to build a strong relationship with the executive team.
“We appreciate the great investing experience TCV brings to the relationship. As a result of its deep customer and technical research, TCV understands our vision and can see just how big an opportunity this is for both of our companies. We’re excited for our future together.”Chase Gilbert, CEO, Built
While the recent funding is a nice milestone for the team, we are even more excited about the tens of thousands of users that access Built on a regular basis to fund their operations, and the opportunity Built has to build more products and do more to help its customers.
We view our investment as a perfect opportunity to add value. We think Built has a superb window of opportunity, as the world moves faster into a recovery being boosted by widespread embracing of digital ways of working. And, finally, we see huge potential in Built’s ability to connect key stakeholders in the construction process, connecting everyone onto a shared system. We’re grateful for this new partnership with Built and Brookfield Technology Partners, 9Yards Capital, XYZ Venture Capital, HighSage Ventures, and existing investors Addition, Index Ventures, Canapi Ventures, GreenPoint Partners, Nine Four Ventures, Fifth Wall, Goldman Sachs, and Nyca Partners among other individual investors. We look forward to supporting Built’s world-class team on their mission to transform a global market. The addressable market is not just the U.S.’s $1.58 trillion, but the world’s annual $10 trillion construction market.
We believe construction finance on a SaaS as a Network footing presents a remarkable future opportunity. Let’s get something great Built here!
If you’re interested in driving change in the construction finance market, Built is hiring!