Construction Tech analysis by CBInsights

Spend into US construction has rebounded to pre-recession highs, hitting $1.1 trillion levels in 2016
About Techcelerate Ventures

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www cbinsights CONSTRUCTION CB insight constructiontech CONSTRUCTION TECH constructiontech CONSTRUCTION TECH PATENT TREND company
Spend into US construction has rebounded to pre-recession highs, hitting $1.1 trillion levels in 2016
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.
www cbinsights CONSTRUCTION CB insight constructiontech CONSTRUCTION TECH constructiontech CONSTRUCTION TECH PATENT TREND company
#constructiontech
CONSTRUCTION TECH
Examining how the multi-trillion dollar construction industry is being 
reshaped by technology
#constructiontech
The technology market 
intelligence platform.
CB Insights software lets you predict, discuss, and 
communicate emerging technology trends using data 
in ways that are beyond human cognition.
www.cbinsights.com
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#constructiontech
www.cbinsights.com
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See what other customers have to say at http://www.cbinsights.com/customer-love
A FEW OF OUR HAPPY CUSTOMERS
The most publicly reference-able customers of anyone in the industry
Pat Grady
Sequoia Capital, Partner
"Think of the fundamental value chain of venture 
capital  If we play the clock forward, the finding 
and assessing of investments will be almost entirely 
done by technology, not human beings. And the 
company that is today positioned to be the market 
leader in that evolution is CB Insights."
#constructiontech
Nikhil Krishnan
@nikillinit
nkrishnan@cbinsights.com
www.cbinsights.com
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ABOUT THE LEAD ANALYST
Research Analyst, CB Insights
Focuses on Healthcare, Consumer Packaged Goods, Industrials, 
and VC Trends
Published research and data analysis have been featured in The 
New York Times, Wall Street Journal, Financial Times, Bloomberg, 
and CNBC, among other major media outlets.
Graduate of Columbia University
#constructiontech
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What Is Construction Tech?
Macro Trends
Private Market Activity
Role Of Corporates
Caterpillar Case Study
Business Models, Approaches, and Trends
Emerging Technologies
www.cbinsights.com
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TABLE OF CONTENTS
#constructiontech
What are we analyzing in 
Construction Tech?
We'll be analyzing how private companies are 
changing the design, process, and execution of 
construction projects.
Private market funding data will be focused on 
companies that use technology as a key differentiating 
point where construction is the primary use case.
www.cbinsights.com
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#constructiontech
Construction Tech: 
MACRO TRENDS
www.cbinsights.com
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#constructiontech
TRUMP INDICATES HE'S SERIOUS ON 
INFRASTRUCTURE SPENDING
November 29, 2016
INFRASTRUCTURE IN THE SPOTLIGHT
www.cbinsights.com
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#constructiontech
Spend into construction has rebounded to pre-recession highs, 
hitting $1.1 trillion levels in 2016
www.cbinsights.com
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FRED
CONSTRUCTION SPEND HAS REBOUNDED
#constructiontech
Construction is expected to see a boom, yet we're already seeing record lows of unemployment in 
construction. This could suggest a labor shortage in the construction market.
www.cbinsights.com
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FRED
CONSTRUCTION UNEMPLOYMENT AT LOWS SIGNALS 
POSSIBLE LABOR SHORTAGE
#constructiontech
CONSTRUCTION IS ONE 
OF THE LEAST 
DIGITIZED SECTORS
Construction is towards 
the bottom when it 
comes to digitization, 
with only agriculture and 
hunting falling beneath it. 
Many of these areas are 
less complex and could 
reduce the cost of 
services if automated 
(eg., transactions, 
business processes, 
etc.).
www.cbinsights.com
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McKinsey
#constructiontech
Tracy Young
CEO, PlanGrid
www.cbinsights.com
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Construction Dive
"When we look at all industries and sectors, by and 
large, everyone has figured out how to use software 
and computing power to be more effective. When 
you look at construction, we're spending less than 1% 
of revenues on software while our counterparts in 
aerospace and manufacturing are spending closer to 
3.5% to 4.5%. Over the last 20 years, everyone else has 
figured out how to be twice as productive while 
construction has not only flatlined but declined."
#constructiontech
PEOPLE ARE LOOKING 
AT CONSTRUCTION + 
TECHNOLOGY
Interest in technology 
use within the 
construction industry has 
begun to increase 
significantly.
CB Insights Trends mines a 
massive corpus of media 
articles to enable a data-driven, 
real-time method to discover, 
predict, and plot the arc of rising 
expectations and excitement.
www.cbinsights.com
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CB Insights Trends
#constructiontech
Construction Tech Funding Trends: 
DEALS, DOLLARS, ACTIVE INVESTORS
www.cbinsights.com
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#constructiontech
Global equity funding since 2012:
$778 MILLION
across
165 DEALS
www.cbinsights.com
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#constructiontech
CONSTRUCTION TECH 
STILL SLOW
While 2015 and 2016 
have seen more deal 
activity than previous 
years, the area as a 
whole hasn't seen too 
much activity compared 
to other tech sectors. 
2015 saw a funding spike 
thanks to large rounds to 
Procore, PlanGrid, and 
OnShape.
www.cbinsights.com
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CB Insights
#constructiontech
www.cbinsights.com
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CB Insights
COMPANY
AMOUNT/ROUND
QUARTER
SELECT INVESTORS
$80M/Series D
Q3'15
Andreessen Horowitz, 
New Enterprise 
Associates, North 
Bridge Venture 
Partners
$76M/Private Equity
Q3'12
TA Associates 
$50M/Series F
Q4'15
O'Connor Ventures, 
Bessemer Venture 
Partners
$40M/Series B
Q4'15
Founders Fund, 
Sequoia Capital, Y 
Combinator
CONSTRUCTION TECH: TOP DEALS
2012-2016YTD (as of 11/28/2016)
#constructiontech
DEAL SHARE INTO 
CONSTRUCTION TECH
Deals into Construction 
Tech indicate a 
developing space. There 
has been growth in early-
stage deal share, with 
three-quarters of deals in 
2016 YTD happening at 
the seed or Series A. 
There have also been 
more mature companies 
slowly raising Series C, D, 
and E+ recently.
www.cbinsights.com
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CB Insights
#constructiontech
CONSTRUCTION TECH 
HASN'T SEEN MANY 
EXITS
Despite the fact that the 
number of Construction 
Tech exits has been 
increasing, overall the 
space has seen relatively 
few liquidity events.
www.cbinsights.com
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CB Insights
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8
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1
2012
2013
2014
2015
2016
CONSTRUCTION TECH EXITS
M&A
IPO
2012 - 2016 YTD (11/28/2016)
#constructiontech
THERE HAVE BEEN 
SOME LARGE EXITS
There have been several 
$500M+ exits in the 
space, all of which 
happened this year. 
There are also publicly 
traded Construction Tech 
companies with 
multibillion dollar market 
caps like Trimble and 
Autodesk.
www.cbinsights.com
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CB Insights
Acquired by Ritchie Bros.
Valuation: $758.5M
Acquired by Oracle
Valuation: $663M
IPO
Valuation: $321.9M
Acquired by Roper Technologies
Valuation: $663M
#constructiontech
NUMBER OF UNIQUE 
INVESTORS RISES AND 
FALLS
While the number of 
unique investors 
participating in 
Construction Tech has 
seen some volatility, 
2015 saw a peak of 87 
unique investors. 2016 
seems to be sustaining 
the same level of 
interest, with 79 unique 
investors through 11/28.
www.cbinsights.com
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CB Insights
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69
46
87
2012
2013
2014
2015
YEARLY UNIQUE INVESTORS INTO CONSTRUCTION TECH
# of Unique Investors
2012 - 2015
#constructiontech
MOST ACTIVE 
INVESTORS
Few investors have 5 or 
more Construction Tech 
companies in their 
portfolio. The only two 
that do are both 
accelerators. Some 
funds are being raised 
with a focus on real 
estate, construction, and 
design (eg., Brick & 
Mortar Ventures). There's 
also a notable absence 
of corporates investing.
www.cbinsights.com
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CB Insights
#constructiontech
Construction Tech: 
THE ROLE OF CORPORATES
www.cbinsights.com
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#constructiontech
CORPORATES SHOW 
LITTLE INTEREST IN 
CONSTRUCTION TECH
Compared to other tech 
industries which typically 
see 20% or more 
participation in deals, 
Construction Tech has 
yet to break 16%. Google 
Ventures was the only 
corporate to make 
multiple bets in 
Construction Tech since 
2012.
www.cbinsights.com
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CB Insights
88%
84%
86%
87%
84%
13%
16%
14%
13%
16%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2012
2013
2014
2015
2016
CORPORATE PARTICIPATION IN CONSTRUCTION TECH 
DEALS
2012 - 2016 YTD (11/28/16)
No Corporate Participation
Corporate Participation
#constructiontech
CONTRACTORS 
ACQUIRE FOR MARKET 
SHARE
Large contractors in the 
construction space 
typically acquire 
consultancies and other 
engineering/design 
firms. Several have made 
acquisitions or 
investments in the 
energy space as well.
www.cbinsights.com
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CB Insights Business Social Graph
#constructiontech
SOFTWARE 
INCUBMENTS ARE 
MORE ACTIVE
Incumbents in the 
software construction 
space are much more 
active, with more than 
119 transactions since 
2010 between 6 firms. 
Autodesk was the most 
active and also has its 
own venture arm.
www.cbinsights.com
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CB Insights Business Social Graph
#constructiontech
CONSTRUCTION 
PRODUCT COMPANIES 
ARE ALSO MARKET 
SHARE FOCUSED
Companies focusing on 
construction products 
also tend to invest or 
acquire companies that 
directly compete or are 
involved in 
compounds/additives to 
improve their products.  
However several have 
set up active venture 
arms including Posco
and Caterpillar.
www.cbinsights.com
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CB Insights Business Social Graph
#constructiontech
CORPORATES ALSO 
PARTNER WITH 
STARTUPS
Corporates don't just 
invest or acquire 
companies, but also 
partner with private 
companies for a variety 
of reasons, from 
sourcing potential 
acquisition targets to 
providing more 
immersive training and 
education.
www.cbinsights.com
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CB Insights
CONSTRUCTION CORPORATE PARTNERSHIPS
#constructiontech
Doug Oberhelman
CEO, Caterpillar
www.cbinsights.com
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Source:  Equipment World
"Our business runs on uptime for our 
customers. If we do it at a lower cost than our 
competitors, we win
If we don't do this, somebody else will. We 
decided that maybe we better disrupt 
ourselvesin our own way before somebody 
does an Uber to us."
#constructiontech
CATERPILLAR IS 
RAMPING UP ACTIVITY
Caterpillar is ramping up 
its activity in private 
markets, including 
setting up an active 
venture arm. The 
investments span a 
broad range of sectors, 
from autonomous 
robots, to exoskeletons, 
to energy distribution and 
storage.
www.cbinsights.com
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CB Insights Business Social Graph
Jan 2010  December 2011
Jan 2015  October 2016
#constructiontech
CATERPILLAR HAS 
INCREASED ITS 
PATENT ACTIVITY
Caterpillar has noticeably 
increased its patent 
activity in 2014 forward. 
This spike in filings 
coincides with its ramp 
up of activity in private 
markets as well; several 
patents coincide with 
investments.
*Patent filing process involves a 
significant time lag before the 
publishing of applications. This delay 
can range from several months to 
over two years.
www.cbinsights.com
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CB Insights Patent Data
66
159
285
334
752
660
913
10
43
92
246
419
610
405
2010
2011
2012
2013
2014*
2015*
2016*
CATERPILLAR PATENTS OVER TIME
Number of Patents Published
Number of Patents Granted
2010 - 2016 YTD (11/28/2016)
#constructiontech
ANALYSIS OF 
CATERPILLAR 
PATENTS
Caterpillar's patents have 
primarily been focused 
on the actual parts of the 
machines themselves. 
One consistent focus 
seems to be fuel across 
the board.
www.cbinsights.com
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CB Insights Patent Data
OVERALL TOP PHRASES BY SIGNIFICANCE
2009 - 2016
2009
2010
2011
2012
2013
2014
2015
2016
hammer
truck
pump
fuel
fuel
hood
implement
plate
exhaust
wheel loader
actuator
valve
display
filter
machine 
implement
module
treatment
wheel
valve
speed
position
component
ground
valve
cab
motor grader
circuit
truck
power
ground
track
hole
housing
grader
fluid
track
cylinder
implement
fuel
bracket
fluid
loader
seal
power
piston
position
housing
pressure
signal
motor
asphalt
transmission
operator
pressure
tip
side plate
treatment device
power
fuel
motor
tire
pump
valve
position
piston
hood
speed
position
plate
machine 
implement
plate
first end
armature
rear portion
wheel
brake
ground
track
combustion
signal indicative
mount
fuel
motor
tank
control system
fluid
body
indicative
shovel
component
pressure
pressure
body
grille
bearing
fuel
passage
track
control system
plate
valve
body
chamber
second end
#constructiontech
ANALYSIS OF 
CATERPILLAR 
PATENTS
Caterpillar's patents have 
primarily been focused 
on the actual parts of the 
machines themselves. 
One consistent focus 
seems to be fuel across 
the board.
www.cbinsights.com
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CB Insights Patent Data
OVERALL TOP PHRASES BY SIGNIFICANCE
2009 - 2016
2009
2010
2011
2012
2013
2014
2015
2016
hammer
truck
pump
fuel
fuel
hood
implement
plate
exhaust
wheel loader
actuator
valve
display
filter
machine 
implement
module
treatment
wheel
valve
speed
position
component
ground
valve
cab
motor grader
circuit
truck
power
ground
track
hole
housing
grader
fluid
track
cylinder
implement
fuel
bracket
fluid
loader
seal
power
piston
position
housing
pressure
signal
motor
asphalt
transmission
operator
pressure
tip
side plate
treatment device
power
fuel
motor
tire
pump
valve
position
piston
hood
speed
position
plate
machine 
implement
plate
first end
armature
rear portion
wheel
brake
ground
track
combustion
signal indicative
mount
fuel
motor
tank
control system
fluid
body
indicative
shovel
component
pressure
pressure
body
grille
bearing
fuel
passage
track
control system
plate
valve
body
chamber
second end
#constructiontech
CATERPILLAR'S 
INVESTMENT IN 
UPTAKE HAS 
RELEVANT PATENTS
Caterpillar is an investor 
in unicorn startup Uptake 
Technologies, which also 
has a patent to monitor 
the health of equipment 
based on different 
indicators.
www.cbinsights.com
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CB Insights Patent Data
#constructiontech
Construction Tech: 
BUSINESS MODELS AND APPROACHES
www.cbinsights.com
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#constructiontech
HARD OR SOFT COSTS?
www.cbinsights.com
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TheRealDeal
#constructiontech
PLACEMENT IN THE 
PROJECT LIFECYCLE
Understanding the points 
in the construction 
process can help sort 
who the buyers of 
software/products are 
and the specific pain 
points that they're 
solving.
www.cbinsights.com
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Design
Procurement
Construction
Operations
#constructiontech
www.cbinsights.com
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REPLACE
CREATE
ENABLE
REPLACE, ENABLE, OR 
CREATE
Do the companies 
replace a part of the 
existing process, enable 
workers in different parts 
of the chain to be more 
efficient, or create 
entirely new workflows 
that did not exist before?
#constructiontech
DESIGN TOOLS
Design software and 
tools focused earlier in 
the project lifecycle 
generally make designers 
more efficient. Some 
also create new 
processes for them by 
providing additional 
insight or design 
possibilities they may not 
have had before.
www.cbinsights.com
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CB Insights
DESIGN TOOLS
#constructiontech
PROJECT 
MANAGEMENT 
SOFTWARE
Software that helps 
monitor a project from 
start to finish as well as 
create a centralized area 
of information for all 
stakeholders across the 
process.
www.cbinsights.com
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CB Insights
PROJECT MANAGEMENT SOFTWARE
#constructiontech
EQUIPMENT 
MARKETPLACES
Marketplaces for 
equipment to help with 
the procurement of 
machinery for projects, 
typically simplifying the 
process for both sides of 
the market.
www.cbinsights.com
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CB Insights
EQUIPMENT MARKETPLACES
#constructiontech
ROBOTICS AND 
DRONES
Robots and drones can 
both replace certain 
parts of the construction 
process as well as create 
new processes that 
didn't exist before (eg., 
Drone operating and 
analysis).
www.cbinsights.com
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CB Insights
ROBOTICS AND DRONES
#constructiontech
THE DISTRIBUTION OF 
CONSTRUCTION 
PRODUCTS IS ALSO 
CHANGING
Construction products 
are also finding new 
points of sale and 
distribution methods that 
are closer to the end 
customers (removing 
nodes in the supply 
chain).
www.cbinsights.com
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CB Insights Blog
#constructiontech
TREND 1: 
DEMOCRATIZATION
Tech provides 
advantages to smaller 
construction players by 
lowering costs of large 
capital expenses, 
creating pricing 
transparency, providing 
more avenues to market 
services, offering 
verification for goods & 
services, and making the 
construction business 
less reliant on 
relationships alone. 
www.cbinsights.com
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British Columbia Law Institute
#constructiontech
TREND 1 (CONT.): 
DEMOCRATIZATION
Democratization means 
focus shifts to the 
individuals/smaller 
players. To avoid longer 
sales cycles of larger 
construction firms, many 
startups focus on small 
businesses and move 
from the bottom up (a 
similar tactic we've seen 
in other tech verticals, 
such as Slack).
www.cbinsights.com
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TOP DOWN
BOTTOM UP
#constructiontech
TREND 2: 
AGGREGATION
By providing user-friendly 
and simplified 
experiences, users flock 
to new Construction 
Tech startups, which in 
turn allows the platform 
to have better 
negotiating power when 
dealing with the supply 
side and creating 
standardization where it 
didn't exist before.
www.cbinsights.com
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Houzz
#constructiontech
TREND 3: 
STANDARDIZATION 
AND SCALABILITY
As more of the 
construction process is 
standardized, it becomes 
easier to scale up the 
goods and services and 
scale down the costs. 
This can be anything 
from standardizing 
process (like getting 
permits) to standardizing 
parts (prefab houses) 
and more.
www.cbinsights.com
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#constructiontech
TREND 4: MOBILE SEES 
STRONG FOOTING IN 
CONSTRUCTION
The number of mobile 
users in the construction 
industry is increasing, 
especially in field-related 
use cases. Increasingly 
more people within the 
industry see mobile as an 
important capability.
www.cbinsights.com
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JBKnowledge
#constructiontech
TREND 4 (CONT.): 
MOBILE FINDS STRONG 
FOOTING IN 
CONSTRUCTION
Since much of the actual 
construction process is 
done in the field, mobile 
devices and tablets have 
played a key role here 
with several companies 
going "mobile-first."
www.cbinsights.com
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CB Insights
MOBILE-FOCUSED CONSTRUCTION TECH COMPANIES
#constructiontech
Construction Tech: 
EMERGING TECHNOLOGIES
www.cbinsights.com
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#constructiontech
DAQRI BRINGS 3D VISUALIZATION TO THE 
CONSTRUCTION SITE WITH AUGMENTED 
REALITY SMART HELMET
Jan 27, 2016
AUGMENTED REALITY
www.cbinsights.com
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#constructiontech
PREFAB HOUSING SEES 
RENEWED INTEREST
While Prefab housing is 
not a new concept, new 
players are seeing 
investor interest with 
some focusing on more 
specific niches (smart 
home, sustainability, etc.)
www.cbinsights.com
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CB Insights
#constructiontech
PREFAB HOUSING HAS 
MULTIPLE USE CASES
Separate use cases in 
prefab housing could 
appeal to different 
demographics. Cheaper 
building costs for more 
affordable housing as 
well as "house-in-a-box" 
ease of setup for higher-
end homes. This could 
drive demand in areas 
that lack affordable 
housing as well as in 
more developed areas.
www.cbinsights.com
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NY Daily News, Blu Homes
WORLD HOUSING 
NON-PROFIT CAMPAIGN
BUILDING $3000 PREFAB SHACKS
BLU HOMES
LUXURY EDITION
OFFERS $1.3M PREFAB HOMES
#constructiontech
THE RETURN OF 3D-
PRINTING?
3D printing is seeing a 
resurgence of interest, 
especially in the 
construction and 
industrial areas.
www.cbinsights.com
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CB Insights Trends
#constructiontech
DEVELOPMENTS IN 3D 
PRINTED MATERIALS
Much of the interest 
could be attributed to 
developments that have 
happened in the actual 
materials themselves, 
many of which can be 
used to create highly 
customized or precise 
parts.
www.cbinsights.com
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i.materialise
#constructiontech
AUTOMATED 
CONSTRUCTION
Parts of the construction 
process that are 
predictable and repetitive 
are seeing automation 
along with machine-
based advantages (faster 
project times, higher 
precision, etc.)
www.cbinsights.com
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McKinsey
#constructiontech
ROBOT USE IN 
MANUFACTURING 
SCENARIOS WILL 
TRANSFER
Many of the functions we 
see robots being used for 
are primarily 
manufacturing use 
cases. Developments in 
material handling and 
shaping could benefit 
work on sites as well.
www.cbinsights.com
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Statista
6%
7%
9%
10%
26%
33%
66%
Automotive OEMs
Metals
Coating & Dispensing
Life Sciences
Spot Welding
Material Handling
Automotive Components
GROWTH IN NORTH AMERICAN INDUSTRIAL ROBOT SALES TO END-
MARKETS 
Q1 2015, BY CUSTOMER SEGMENT (OVER SAME PERIOD ONE YEAR BEFORE)
#constructiontech
THESE TRENDS COULD 
POINT TO ON-SITE 
TEMPLATED 
CONSTRUCTION
When we take these 
trends together, we could 
start to see preformatted 
houses that are built on-
site through a 
combination of 3D 
printing and robotics, 
making scalable and 
affordable temporary 
housing.
www.cbinsights.com
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RT
#constructiontech
QUESTIONS?
www.cbinsights.com
59
@nikillinit
nkrishnan@cbinsights.com
#constructiontech
Where is all this data from?
The CB Insights platform has the details on all the 
deals included in this report
www.cbinsights.com
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#constructiontech
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