Future of Housing by CBInsights

Driven by a convergence of technology development and market need, entrepreneurs and technology companies alike have drawn aim at the residential construction industry. Insurgent startups are testing a variety of construction techniques, while big technology companies are participating through direct development projects.
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construct company House build House construct trend Source Sidewalk Labs real estate Initiative Source technology company developed startup trend
About Techcelerate Ventures

Tech Investment and Growth Advisory for Series A in the UK, operating in £150k to £5m investment market, working with #SaaS #FinTech #HealthTech #MarketPlaces and #PropTech companies.
construct company House build House construct trend Source Sidewalk Labs real estate Initiative Source technology company developed startup trend
Future of Housing
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Alex Paci
Alex Paci is an intelligence analyst at CB Insights covering startup and venture 
capital trends in real estate and financial services. His research has been cited 
in Wired, The New York Times, The Financial Times, and The Wall Street Journal. 
@alexander_paci   |   apaci@cbinsights.com
Intelligence Analyst
A B O U T  T H E  A N A L Y S T
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Contents
1 1
Housing & construction 
trends
1 6
Startups & new construction 
techniques
2 7
FAMGA initiatives
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Driven by a convergence of technology development and 
market need, entrepreneurs and technology companies alike 
have drawn aim at the residential construction industry.
Insurgent startups are testing a variety of construction 
techniques, while big technology companies are participating 
through direct development projects.
T H E  B I G  I D E A
B A C K G R O U N D  &  T R E N D S
Housing & construction trends
S T A R T U P S
Startups & new construction techniques
F A M G A  P A R T I C I P A T I O N
Big tech's real estate initiatives
H O U S I N G  O F  T H E  F U T U R E  F L A S H  B R I E F I N G
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2
3
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B A C K G R O U N D  &  T R E N D S
Housing & construction trends
S T A R T U P S
Startups & new construction techniques
F A M G A  P A R T I C I P A T I O N
Big tech's real estate initiatives
H O U S I N G  O F  T H E  F U T U R E  F L A S H  B R I E F I N G
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What's driving this trend? A national housing shortage
The US has a housing shortage of 7.3 million 
units.
Home prices rose 6.2% in 2017, two times more than income, and three 
times inflation. One in four Americans is "severely rent burdened" 
(paying more than 50% of their monthly income on housing) as a 
consequence.
Lack of labor, as well as limited land supply and 
strict zoning regulations are inhibiting 
construction of new homes.
In Seattle, for instance, single-family accounts for 49% of all 
"developable land mass," with 8% devoted to multi-family, and 8% for 
commercial real estate. The majority of new housing is focused on 
multi-family.
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Source: WSJ, Sidewalk Labs
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"No matter what we do to deliver more value to 
customers, the fundamental problem is that there aren't 
enough homes to buy."
M O R E  H O M E S  N E E D E D
Glenn Kelman
President & CEO, Redfin
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The US construction industry invests 0.5% of annual 
construction value in R&D. This compares to 3.7% for 
automotive, and 8.8% for computing & electronics.
This makes the economics of housing innovation hard. 
O N E  B I G  R E A S O N  F O R  T H E  L A C K  O F  N E W  H O U S I N G  I S  T H E  C O S T  O F  C O N S T R U C T I O N
Source: Sidewalk Labs
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"It's shocking how poorly things work. There's a lack of 
quality processes throughout the system."
Michael Marks
Chairman, Co-Founder, Katerra
B A C K G R O U N D  &  T R E N D S
Housing & construction trends
S T A R T U P S
Startups & new construction techniques
F A M G A  P A R T I C I P A T I O N
Big tech's real estate initiatives
H O U S I N G  O F  T H E  F U T U R E  F L A S H  B R I E F I N G
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2
3
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Offsite: modular and prefabricated
Factory production
I N N O V A T I O N S  I N  C O N S T R U C T I O N  T E C H N O L O G Y
Companies are investing in repeatable 
processes for the construction of 
modular units or component parts. 
Supply chain & BIM design
Companies that own both the design 
and construction process have 
developed standardized design to 
maximize materials efficiency and 
procurement. 
Energy & Sustainability
Builders are turning to carbon neutral 
and sustainable materials like tall 
timber and mycelium. 
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Blokable manufactures 
structured building systems 
for developers to bring small 
format residential, retail, and 
mixed-use projects rapidly to 
market.
S E L E C T  I N V E S T O R ( S )
Borealis Ventures, Jason Calacanis, 
Kapor Capital, Urban.us, Vulcan Capital
S T A C K A B L E  H O M E  U N I T S
Total Funding
$6.08M
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Katerra's integrated 
technology offering connects 
Building Information 
Modeling (BIM) tools and 
computational design directly 
to an ERP global supply 
chain. Materials arrive at 
construction sites just-in-time 
and ready to install.
S E L E C T  I N V E S T O R ( S )
DFJ Growth Fund, SoftBank Group, 
Foxconn Technology Company
O W N I N G  T H E  C O N S T R U C T I O N  P R O C E S S
Total Funding
$1.16B
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Katerra expanding via acquisitions and factories
Katerra is expanding its 
capacity. Recently the company 
acquired Fields Construction 
Company of New Jersey. Field's 
will rebrand and adopt Katerra's 
technology practices.
The company plans to open six 
manufacturing plants in 2019, 
including a timber factory in 
Spokane, Washington.
The plant will produce CLT, or 
cross-laminated timber. 
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Source: Inman, Building Design + Construction
The potential of tall timber construction
The T3 building, pictured below, is one of the largest timber buildings in North America at seven stories and 
220,000 sq/ft. Tenants include Amazon.
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Canada pushing timber forward in construction
Given the abundance of lumber in Canada, 
much of the development of timber 
construction is occurring there. 
In October of 2017, Canada's Minister of 
Natural Resources, Jim Carr, announced a 
mass timber program called Green 
Construction Through Wood which 
encouraged timber construction in tall 
buildings. 
This is the second such timber program, the 
first being the Tall Wood Building 
Demonstration Initiative, a program which 
resulted in the 18 story Brock Commons 
Tallwood House at the University of British 
Columbia, the tallest majority wood structure 
in the world (right).
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Source: Canada.ca, NRCN.gc.ca
pushes co-living as a way to repurpose space 
Starcity is an example of a company in the growing coliving space. The San Francisco-based startup is a graduate of Y Combinator and has raised 
$18.6M to date, most recently via a $16.4M Series A from Alrai Capital, Bullpen Capital, Invest AG, and Y Combinator.
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Common offers flexible 
shared housing connecting 
vetted members to private 
rooms in furnished 
properties. 
S E L E C T  I N V E S T O R ( S )
Maveron, Norwest Venture Partners, 
8VC
A D U L T  D O R M S
Total Funding
$65M
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"I'm not looking to change the way people live. I'm looking 
to solve a housing need." 
S O L V I N G  F O R  A  M A R K E T  N E E D
Brad Hargreaves
CEO, Common
Collections 
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D I G G I N G  D E E P E R
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capabilities highlighted during this briefing.
Trends
Prefab trends search
Reports & Research
Construction tech market map
Offsite Construction Companies
WeWork report
Profiles
Blokable
Starcity
Katerra
Common
B A C K G R O U N D  &  T R E N D S
Housing & construction trends
S T A R T U P S
Startups & new construction techniques
F A M G A  P A R T I C I P A T I O N
Big tech's real estate initiatives
H O U S I N G  O F  T H E  F U T U R E  F L A S H  B R I E F I N G
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2
3
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In addition to insurgent startups, some of the largest technology 
companies are driving innovation via partnerships, paid projects, 
and developments.  
+                     
While not the most significant foray into 
construction, Amazon has recently formed a 
partnership with Lennar, Shea, and Brookfield 
Homes, some of America's largest residential 
home builders and developers.
The terms of the Lennar partnership call for 
Amazon experiences centers in California, 
Florida, Georgia, Texas, Virginia, and 
Washington where customers can tour Lennar 
homes and interact with Amazon's suite of 
smart home devices. 
Amazon's smart devices will be physically 
implanted into every new residence Lennar 
builds.
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Source: Amazon, The Information
developing a presence in multi-family
Separately, Amazon has crept into multi-
family real estate as well. In October 2017, 
Amazon formed partnership with landlords 
including AvalonBay Communities Inc., Equity 
Residential, Greystar, and Bozzuto Group, to 
place package delivery lockers in buildings 
representing over 850,000 units in the US.
Greystar, for instance, which manages 
415,000 units, will install the Amazon locker 
hub system in 125 communities, and offer the 
service to all of its buildings. 
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Source: WSJ
plans for Willow Campus
Facebook has plans to expand 
its campus in Menlo Park and 
add residential housing.
The company will construct 
1,500 units housing, of which 
225 will be at below-market 
rates.
Additionally, the plans call for 
mixed-use retail, including a 
grocery store and pharmacy, in 
addition to 8 acres of plazas, 
parks, and biking/pedestrian 
paths.
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Source: Facebook
+                      build 300 homes
Google's largest foray into 
residential construction to-date 
has been its development plans 
for Moffett Field in Mountain 
View. The company ordered 300 
modular housing units, 
spending between $25-$30M on 
the order. Factory OS, based in 
Vallejo, California will fulfill the 
order.
Factory OS claims it reduces 
cost by 20% while building 40% 
faster.
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Source: Mercury News, Factory OS
In 2015, Google 
restructured as 
Alphabet.
Sidewalk Labs is 
dedicated to urban 
innovation efforts.
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and a bold plan to rewrite the city
Source: Sidewalk Labs
Sidewalk Labs lays out a vision for a highly sophisticated neighborhood in Toronto, measured by a sensor network 
and served by progressive approaches to residential, retail, energy, and transport solutions.
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Expansive plans tied together by a digital layer
The neighborhood's digital layer 
will be achieved via a net of 
sensors and cameras that will 
provide an "unprecedented 
degree of insight into the 
physical environment." The 
digital platform will have four 
main components:
 Sense
 Model
 Map
 Account
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Source: Sidewalk Labs
A blend of cutting edge construction methods
Modular or volumetric 
construction will be 
complemented by "one and two-
dimensional" components, 
similar to the kind of 
construction a company like 
Katerra performs.
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Source: Sidewalk Labs
Designing the 'Loft' for multipurpose building usage
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Sidewalk Labs is developing a building product called Loft that integrates many of the construction techniques discussed here. The product's 
thesis centers on the assumption that "ongoing and frequent interior changes" will be demanded of each building, and therefore an interior unit that 
can be reconfigured within a "strong skeletal structure" is optimal; reducing the cost of future construction. This is termed 'radical mixed use,' 
where residential, retail, office, and parking might occur within the same buildings.
Source: Sidewalk Labs
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Will large technology companies and startups collaborate further on campus housing 
initiatives? 
Will big technology companies seek to partner with existing construction players (e.g. 
Amazon expanding its partnership with Lennar)?
Will Sidewalk Labs' Toronto project lead to larger urban planning projects in major US 
cities?
Are any startups in construction or coliving potential acquisition targets?
L O O K I N G  A H E A D 
Questions?
Twitter: @alexander_paci
Email: apaci@cbinsights.com 
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