The 2021 Top Construction Technology Firms™
No other sector has been more influential on construction industry productivity and profitability during the past two decades than technology. As cloud computing has evolved, empowering workers and management with access to real-time data for the first time, construction technologists have spent 20 years building the foundation for businesses to streamline workflows, automate routine tasks and make informed, data-driven business decisions.
COVID-19 put cloud technology to its greatest test as construction companies accelerated adoption of remote project management and collaboration solutions out of sheer necessity. This giant leap forward has been the pandemic’s silver lining for an industry facing formidable supply-chain issues in addition to a critical shortage of skilled workers.
It is technology that has provided the bridge from yesterday’s anachronistic and often redundant workflows to today’s hard-won reality of how things get done efficiently and effectively. With an army of remote employees and field workers using an arsenal of smart devices connected to real-time project data, the industry is poised for a true technological revolution.
For its inaugural list of The Top Construction Technology Firms,™ Construction Executive reached out to the top technology companies that are continually innovating to make construction the transparent and collaborative enterprise it deserves to be.
Tech Acquisitions Heat Up
Contractors are not the only companies facing competition in today’s market. Established technology providers face growing competition from a dizzying number of startups as more private equity investment firms place well-considered bets on the market potential for niche software solutions in the trillion-dollar construction industry. According to CB Insights, construction tech startups raised close to $1.4 billion in 2020, and 2021 is on track to surpass that. Construction-focused tech firms Built and Briq, for example, raised $88 million in Series C and $30 million in Series B funding respectively this year.
In an environment where announcements of mergers, acquisitions and new rounds of funding are daily fare, no tech firm can afford to stand still. Executives are acutely aware of the need to continually evolve their offerings to adapt to ever-changing industry needs and the newest technology trends.
Trimble, Autodesk, Bentley Systems and Procore are four examples of publicly traded technology companies that have evolved far beyond their early beginnings through a series of strategic acquisitions.
After its 20th anniversary in 2010, Trimble made a string of acquisitions that took it far beyond its roots in surveying and GPS solutions, purchasing Tekla, Sketchup and Viewpoint, among others. Mark Sawyer, Trimble’s director of construction industry strategy, says the company’s key areas of development “include embedded collaboration features in our applications and open platforms, purpose-built to work across software from multiple vendors.” Regarding Trimble’s future development efforts, Sawyer says, “We are focused on helping our customers build more resilient and sustainable businesses. We believe that these goals are very attainable by establishing dataflows that include open, scalable platforms, analytics insights and point tools that enable a constructible process and a connected construction approach. This will continue to be our emphasis as we build out our roadmap.”
Autodesk is another tech behemoth that has grown by acquisition over the past two decades. After purchasing Revit in 2002, it went on to acquire PlanGrid, BuildingConnected, Pype and others. Bentley Systems has acquired multiple global tech firms this year alone, including New Zealand-based Seequent in March for roughly $1 billion.
In May, Procore Technologies acquired INDUS.AI and launched its IPO, giving it a market valuation of nearly $11 billion. This followed a string of acquisitions by Procore, including Honest Buildings in 2019, as well as Esticom and Avata Intelligence in 2020. “We’ve been dedicated partners with this industry for almost 20 years and believe our platform is uniquely positioned to lead the industry’s digital transformation,” says Tooey Courtemanche, founder, president and CEO of Procore. “It’s early days, and we feel fortunate to be at the heart of transforming this essential industry.”
Private equity firms are also on the hunt for investment opportunities in the construction tech space. After selling Deltek in 2016 for $2.8 billion to Roper Technologies, Thoma Bravo purchased a majority interest in Foundation Software in 2020. In turn, Foundation was able to leverage that investment by acquiring McCormick Systems.
“McCormick is a great family company, and we’re lucky to work with another team that has similar values to ours,” says Mike Ode, CEO of Foundation. “We’ve always focused on developing products that address needs within the construction industry. We retain a heavy emphasis on increasing efficiency within and among the different teams that keep a construction company in business.”
The impact of continued investments in construction technology (aka contech) firms will ultimately drive further adoption across the board. Smaller construction firms and subcontractors will gain access to platforms that were previously out of reach.
Trial by Fire
As COVID-19 cases rise once again, collaboration technology is no longer viewed as something that would be nice to have; it’s an essential capability for contractors to remain viable in a highly competitive market.
Limited access to in-person appointments has inspired many companies to embrace electronic compliance processes, which make the idea of going back to the pre-pandemic chore of chasing down a notary seem downright archaic. GCPay introduced a remote online digital notarization tool, valid in all 50 states. “We created that in the product itself so that it’s a seamless workflow that doesn’t disrupt automation,” says Mike Milligan, head of global marketing for GCPay. “Now subcontractors and general contractors can have documentation notarized online, particularly compliance documentation, without having to leave their home offices.”
Further, surveys during the past two years have confirmed that the majority of U.S. workers who transitioned to working from home during the pandemic not only prefer to stay remote, but would seek employment elsewhere if office attendance became mandatory. “Remote accessibility is not only here to stay but will be critical moving forward,” Ode says, adding that remote accessibility between Foundation’s accounting software and its Payroll4Construction service allowed workers to keep processes flowing even when they weren’t in their usual office space. “Increasing contractors’ ability to remotely access data across all platforms is something we continue to move forward with.”
Ajoy Krishnamoorthy, chief strategy officer for Acumatica, agrees. “The new, younger workforce in construction is demanding modern solutions that allow for data access anywhere, anytime and on any device. We expect this trend to continue as more mundane tasks are automated.”
For many firms, the pandemic illustrated how much their administrative personnel relied upon in-person communication to get things done. “Before COVID-19, there was a lot of tech growing from a field-to-office communication perspective, but now our users are demanding more tools for their accounting and administrative teams,” says Ben Conry, co-founder and head of customer success at Flashtract. “They want to use less paper and communicate in real time with all project stakeholders regardless of whether they are in the office. Connecting the back office with project stakeholders, including subcontractors, makes for a more efficient project execution in addition to the field technology they are already using.”
During the pandemic, preventing the spread of COVID-19 throughout a company’s workforce became essential. More than a few tech companies rose to the occasion to ensure construction clients could easily share information as workers were screened for signs of illness. Daily tracking and notification of employee wellness became increasingly important for managing jobsites, especially for essential workers in charge of maintaining electrical grids, telecommunications, hospitals and other critical infrastructure assets.
“One of our customers had a need to track employee wellness daily and be notified of potential health risks, enabling them to proactively provide assistance when appropriate. So, we created a survey tool that integrated into the Acumatica platform,” Krishnamoorthy says.
“Early on in the pandemic, we made the decision to focus our development team on the creation of new mobile apps and enhancements designed to aid our customers in complying with COVID-19 guidelines and to help keep their staff members safe,” says John Rosch, regional sales manager for Explorer Software. “One of the first things we created was an employee time portal app, with the goal of minimizing physical contact. Field workers could easily submit data for approval from anywhere without compromising social distancing requirements by handing paper to a supervisor.”
Woody Chamberlain, president of e-Mars, says the tracking of vaccinated and unvaccinated workers alike should be taken seriously, and implemented the capabilities to do just that in its certified payroll compliance software. “The government may force contractors to know who has been vaccinated to be allowed on a jobsite. We can store a vaccine document and even prevent filing of payroll if all people on the job are not vaccinated. We are also able to create a notice that an employee is not vaccinated.”
Constantly changing state and federal mandates continue to plague the industry, and many tech providers have stepped in to help keep clients working with minimal interruptions. This proved to be a lifeline for small and mid-sized contractors that did not have a dedicated safety staff to create electronic inspection and safety forms for compliance.
“There was a strong need among users for help with the practical implementation of public health guidance,” says Peter Grant, CEO of Safesite. “We helped them streamline the practical aspect of managing COVID-19 through the digitization of safety workflows and an extensive library of templates, including many regional and industry-specific safety meeting and inspection templates.”
Construction firms continue to dig through a backlog of work from projects delayed by the pandemic even as they prepare to analyze the opportunities in the $1.2 trillion bipartisan infrastructure bill. Having access to capital is essential for contractors that are planning to bid on potential infrastructure projects even before a contract is signed.
“Everyone’s business has evolved since COVID-19, and our technology solutions are no stranger to that,” says Bobby Morrison, chief sales officer for Intuit. “In particular, we’ve put a lot of emphasis into our online ecosystem—having remote cloud access with security, all operationally available in the palm of your hand. We’ve also seen a tremendous need for access to capital. Getting access to capital is the lifeblood of any construction business, and we’ve done a lot of work getting capital in the hands of businesses so that they can continue to win in the marketplace.”
Data Access and Transparency
Interoperability is crucial for an industry that depends on many different parties to come together seamlessly to make a project work. Transparency and access to information are ways technology has driven success and profitability, but can only be achieved when all parties involved work from a single source of truth.
Originally founded as Computer Methods International Corporation, CMiC has been building enterprise software since 1974. “Our software has been fully web-based since 2000,” says Bill Gustaw, team leader for CMiC’s solutions group. “Since 2015, most customers have deployed their software in a multi-tenant cloud environment. As a result of our web-based roots, SaaS and PaaS deployment models, as well as a growing portfolio of mobile apps, our users didn’t miss a beat when it came to switching to a work-from-home model.”
“A project management solution is at its best when it unites teams in a single collaborative environment, providing all participants with the tools and integrations to collectively move the project forward,” Courtemanche says.
Jan Tore Grindheim, founder and CEO of Fonn, agrees. “Most management software tools and their pricing structures are, by nature, exclusive. For a tool to be truly effective, everyone on-site needs access to current information. The only constant is change, and that change can be detrimental to schedules and budgets if all parties are not in communication. We believe communication should take place in the same location as jobsite milestone tracking and document storage,” Grindheim says.
Contractors spend a great deal of time hunting down information and catching errors in multiple systems on projects that often undergo multiple changes. Cutting wasteful tasks is a key indicator of successful tech implementation, which can eliminate the daily frustration of hide-and-seek information and processes.
Finding that uniformity in management software can cure many issues that slow a project down, such as double entry, responding to change orders and, as Varsha Bhave, president and chief technology officer of Systemates says, scheduling. “Many times, different divisions of a project will each have their own preferred construction scheduling software, which doesn’t do project managers or owners any good. It’s essential to have a central location where all schedules are stored in a standard format to provide that at-a-glance view to spot potential problems.”
“It’s crucial for a project foreperson to keep the job moving in order to get the materials they need to keep the project on schedule,” says Matt Wagoner, CEO and co-founder of PeerAssist. “Users can digitize text messages, voicemails and emails to create a digital record, which allows material requisitions to flow seamlessly to the purchasing agent. We want to eliminate re-keying and duplicate entry and capture approvals without the process becoming bottlenecked.”
Following the Money
Tech solutions have long been available to allow contractors to capture labor costs automatically in real time. Making that data transparent to all project stakeholders helps detect problems quickly and prevent profit fade. When labor costs are recorded manually by multiple people, the potential for human error increases, leading to duplicate entry and costly mistakes. Maintaining accurate labor costs is the linchpin of effective job cost reporting.
“Being able to record time once in the field and automatically route it to relevant staff for review and approval speeds up the process, reduces errors and results in labor being posted on a daily basis,” Gustaw says. “Project staff always have a current view of labor costs and can use this information to ensure the timely completion and profitability of a project.”
A more recent development has been business intelligence technology solutions that use artificial intelligence to provide even deeper business insights.
“Pre-pandemic, most of our construction industry clients had their finance and accounting teams focused on rearview reporting of what had taken place in the business over prior periods with traditional financial and work-in-progress reports,” says Ibrahim Seif, director of sales for Prophix Software’s construction and real estate division. “During the pandemic, contractors faced a lot of pressure to closely monitor cash, profitability, costs and risk to stay agile in the changing situation. We saw a major shift in focus for these firms and a demand to leverage their data to provide more insight into forward-looking projections, scenario planning and agile forecasting. This function of the finance team isn’t going away.”
Being business-flush and cash-poor isn’t uncommon in the industry as a result of the traditional construction payable ecosystem. Contractors often start work on a job expecting not to get paid for 90 days while taking loans to cover the costs for materials, equipment and labor.
Chase Gilbert, CEO of Built Technologies, believes the process can be improved with digitization. “We wanted to fix construction lending,” Gilbert says. “Now we want to follow the money downstream and fix construction spending. With good connectivity, you could eliminate a lot of that need to borrow. The payable cycles within the industry are ridiculous, and if we digitize more of this, we can introduce new payment methods among parties to help them either pay or get paid faster.”
A common headache for contractors is the approval process for change orders. A poor system can lead to payments for unauthorized work. “When a change order from a subcontractor is submitted into an accounting system, you want to be able to track that in your payment processing system, too,” GCPay’s Milligan says. “Our users can monitor, track and act on change orders with updates reflected in both their payment and accounting systems.”
Despite a construction job growth outlook of 5% through 2029, higher than any other industry, getting boots on the jobsite has been a long-standing concern. The latest U.S. Bureau of Labor Statistics Current Employment Statistics Report saw little movement in July due to weak spending in June and a slowing in residential building permits. These factors are driving demand for data intelligence that can inform contractors if they are using their workforce in the most efficient manner.
“The pandemic saw nearly a million people leave the industry in the few months before construction was deemed an essential service. Most of that workforce has since returned to work, but with so much uncertainty and so many team members choosing to work remotely, we’ve seen the demand for collaborative tools explode. Contractors now need to keep multiple departments up to speed regarding their workforce availability to help inform their own work,” says Mallorie Brodie, CEO and co-founder of Bridgit.
The pandemic’s impact on employment and a shrinking skilled workforce has left many contractors shuffling people from one project to another to fill gaps; however, as Brodie says, “Filling gaps isn’t just about hiring more people. In a lot of cases, gaps can be filled by leveling up the current team—but doing it effectively will require greater information sharing.”
Ben Schultz, a fourth-generation electrical contractor and CEO of LaborChart, says, “Workforce management is the most neglected piece of every contractor’s business. If we can identify the people and their roles and responsibilities, then we can identify what processes they take to execute them and what resources they need to accomplish what they are trying to do. We are always looking at what is working well and what needs improvement within the industry.”
According to the Q2 2021 U.S. Chamber of Commerce Commercial Construction Index, 44% of contractors plan to spend more on tools and equipment by the end of the year, putting pressure on equipment managers to ensure that they have the right procedures in place to track and deploy these assets efficiently.
“Asset management and tracking needs to keep pace with other technologies and advancements within the industry. For contractors to get to the next level of equipment management maturity over the next decade, their tech needs to incorporate the latest business intelligence tools that can manage new asset types such as robotics, autonomous vehicles and assistive devices,” says Austin Conti, co-founder and CEO of Tenna LLC.
The infrastructure spending bill will spur purchases of new equipment, along with an increase in theft. According to the National Insurance Crime Bureau, the construction industry loses nearly $1 billion to equipment theft per year. There were more incidents of theft during the pandemic, largely as a result of unmonitored jobsites and an absence of tracking technology.
“Contractors should look for asset tracking and management system providers whose sole focus is on the construction industry with a single, fully integrated platform. They need a partner that will provide hands-on, first-class implementation and training to ensure proper set up and ongoing customer support for long-term success,” Conti says.
Use of unmanned aerial vehicles, or drones, increased during the pandemic, and investors are paying attention. DroneDeploy raised $50 million in Series E financing earlier this year, bringing its total funding to $142 million, more than any other drone company to date.
According to the Federal Aviation Administration, there are 348,769 commercial drones registered in the United States. An affordable way to manage jobsites, drones are used to manage safety protocols, ensure social distancing and capture images from high-risk areas. Drone imaging can be combined on a BIM platform to generate 3D models that can be updated, modified and shared with all the stakeholders on a project. Drones can be used to capture interior, exterior, ground and aerial data for surveys, inspections and jobsite documentation.
Traditional cameras, primarily used to monitor jobsites for security measures, are being used for a variety of other applications. Real-time imagery from cameras and drones with date and time stamps can dispel disputes between contractors and owners when questions arise regarding project delays or documentation of work completed.
The artificial intelligence market is anticipated to grow exponentially within the next few years, largely due to the pandemic—and this is good news for the industry. Using pattern recognition and machine learning, AI can stave off scheduling conflicts, prevent delays and mitigate risk.
“We’re connecting AI across our platform. This helps eliminate errors and allows you to make better decisions on the go. We’ve made a tremendous investment in that over the last few years, and you’ll continue to see us invest as we go forward,” Intuit’s Morrison says.
AI can combine large amounts of data with fast, frequent processing that allows it to learn from algorithms. Once these are learned, AI can be used to advise on projects, scheduling and more.
“We’ve been investing in AI for several years now, and over the course of the pandemic, we’ve seen significant, tangible results with enhanced AI and machine learning capabilities in our software. This evolution now gives our customers not only the ability to streamline and automate their planning, budgeting, forecasting and reporting processes but also leverage an AI engine to derive insights that enhance decision-making,” Profix Software’s Seif says.
“We’re not trying to just expose data, we want to use it to help people make better decisions,” Built Technologies’ Gilbert says. “Whether it’s the identification of new opportunities, managing risk or how fast payments are getting in and out the door, what people want now is to supplement what we already provide with other sources.
One of the underlying issues that the pandemic exposed more clearly has been the cost of siloed data. When information isn’t flowing freely between all branches of a construction project, cost overruns are usually not far behind.
“We’ve taken a data-first approach and, as such, we help companies bring their own technology and processes into a central data environment where they gain full visibility and enable continued innovation and adoption,” says Chris Peters, senior vice president, North America for Asite. “This has never been more critical than today, as we settle into the new normal. Our goal is to make it easier for organizations to collaborate across the entire project lifecycle in an open and transparent way.”
Unpredictability, economic uncertainty and risk allocated to others in the construction chain have been pain points that the tech industry sees being solved—at least in some part—by using data, not just collecting it. According to FMI’s Big Data Report, 95.5% of all data captured goes unused in the engineering and construction industry.
Schultz gives this example of a typical missed information opportunity. “If you’re an electrical contractor with 100,000 labor hours on a two-year project, there is plenty of information out there that you can reference to see how this project should be staffed to create labor plans. Oftentimes, a contractor does not know if they’re going to make money, or lose money, until the last 10% of a project. At that point, it’s too late to make any corrections. If you are creating labor plans and using your data, you will be able to know when you go off course,” Schultz says.
Solving tech and labor issues means appealing to the younger generation entering the workforce, which expects modern solutions and constant connectivity. Pew Research reports that millennials now make up the largest part of the workforce, and they have no patience for contacting multiple people separately by phone or email when a task can get done more efficiently by collaborating on one platform.
“As younger, tech-savvy people enter the workforce and the use of machine learning, artificial intelligence, “Internet of Things” and automation continues, construction companies will drive profitable and successful projects,” Krishnamoorthy says. “Modern cloud accounting systems offer access to data while connecting with other systems that are important for different users within the organization.”
The Future of Construction Tech
As tech giants invest millions in smaller, successful companies to close integration gaps without reinventing the wheel, the industry is a step closer to full integration and allowing contractors more freedom of choice. These investments shed a positive light on the next 10 years for construction, giving the industry the ability to work efficiently, stem potential disruptions and even guide other industries in the future of work. Transparent and standardized solutions not only allow contractors to gain operational efficiencies, but prepare them for potential disruptions and inform them for future projects.
“We believe in empowering construction businesses to use the best mix of solutions that address their unique needs,” says Dustin Stephens, vice president of Sage Construction and Real Estate. “This means having the flexibility to choose from our solutions as well as those of other best-in-class technology providers. We recognize that it benefits our customers when we can integrate our solutions with other solutions they are using, and we want to make it easier for technology vendors to work together.
“We want to be part of a revolution—one that takes construction from an industry that has been a challenge to evolve to one that’s leading the way in efficiency,” Grindheim says. “Thus far, we have taken a non-digitized industry and made it digital and mobile. In the next 10 years, we want our algorithms teaching users how to avoid costly mistakes before they happen.”
The pandemic changed the way the construction industry does business and forced it to scrutinize its technological capabilities and where it was letting valuable data fossilize. While the COVID-19 crisis accelerated digital transformation, the innovation that is sweeping the industry today will have to be closely aligned with product roadmaps that align with pathways to widespread adoption.
“Because construction is a key component of an economic resurgence, connected data, as well as the ability to gain valuable project insights and share those things across teams will play a key role in a post-pandemic world—especially as our industry continues through its data revolution,” says Brad Barth, chief product officer for InEight.
Construction companies no longer lag other industries in the use of technology—at least, those firms that are making the required investments to improve the bottom line. Key players in technology will continue to innovate, leveraging data from connected back offices and web-connected field workers, to create the applications that will make the business of construction more predictable and more profitable in the future.
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