We often overlook the built-world industry as a hotbed of technological innovation. Peering through the fencing of a construction site, one might be surprised to find that the scene has remained relatively unchanged for decades. Heavy machinery, workers in high-vis jackets, and good old-fashioned mud still dominate. Major construction companies lead the projects, supported by numerous subcontractors. On the surface, it seems there's little room for ambitious tech startups.
Discover the Hidden Tech Potential in the Built World
Global Figures and UK's Standing
According to global figures from European venture capital firm NOA, startups in the "built world" sector are set to secure $24 billion in investment this year, with $21.1 billion already raised. In the UK, built-world companies have raised $1.2 billion so far, with London leading in deal volume. This shows that there is indeed potential for growth and innovation in this seemingly traditional industry.The Importance of the Sector
As NOA founder Gregory Dewerpe emphasizes, everyone on the planet is affected by the built-world sector in various ways. Financially, physically, psychologically, or otherwise. It's not just about buildings; it's about the energy that goes into them and how to decarbonize it. Resource efficiency is also crucial, such as dealing with the end-of-life of building assets like batteries and solar panels.Sector Overlap and Investment Trends
There is a significant crossover between startups in the built world and those in other segments like climate. Decarbonization is a major theme, with an 10% increase in investment in electrification technologies driven by smart grid technology. Robotics, too, has seen an increase in investment, with a 61% rise in industrial automation funding and an 890% jump in capital for building operations robotics.New Technological Capabilities
There are fascinating advancements in robotics and AI. Robots are becoming smarter and more user-friendly. The emergence of 5G is also creating a technology infrastructure that makes building and scaling easier. Additionally, it can make hardware development cheaper while still maintaining an asset-light business model.Must-Have Technologies for the Industry
NOA is looking for startups that offer "must-have" solutions to the industry. These are solutions that deliver a clear return on investment (ROI) for the end user, whether it's in operational efficiency, financial efficiency, or system capability improvement. If a startup can provide one of these, there will be a budget and a willingness to adopt.Real-World Examples
Marius Westhoff, co-founder of Smalt, identified a significant labor shortage in the industry. In Germany alone, there is a shortage of around 700,000 individuals to carry out installations. Smalt raised €8 million to train unskilled workers using new age tech and education models. The trainees become part of installation squads, and the operation is supported by step-by-step workflow tools. This shows how startups can address real industry pain points.Pitching to Long-Established Businesses
Successfully pitching to long-established businesses in a conservative sector requires listening to them. Understanding their pain points and how startups can work together to solve them is crucial. It involves weeks and months of discussions with potential customers to identify key problems. Once a customer is interested, there is an opportunity to build a relationship and establish an innovation journey together.
