Applying FinTech solutions to the construction space has the power to create an explosion of new possibilities for the industry. We imagine a world where more projects run on time, remain on budget, and are completed profitably. Ultimately, FinTech will help streamline inefficiencies in the construction industry by helping stakeholders manage risk across projects and their diverse, complicated relationships.
Let’s imagine this together…
Near-future technologies will allow inventory to be tracked and measured at every touchpoint.
When new supplies arrive on site, this information is sent throughout the ecosystem: workers will know which materials go to which tasks, contracts will be automatically updated, quality will be measured and tracked, construction models and project financial projections will be automatically calibrated.
From here, construction site workforces will be able to efficiently allocate to project jobs, and these jobs will be completed with more visibility, and less accidents and errors.
As workers build out the site, a wealth of data about project completion, compliance, and potential hazards will be available to all parties. Developers and lenders will be able to know the precise status of work in flight, and workers will be more safe and productive. Workers and suppliers would directly receive payments from lenders immediately after a task is completed. And for lenders, a comprehensive view of portfolio performance and management, all in real time.
We believe that financial technology has the power to address the core issues of the construction industry’s productivity challenge. In our whitepaper linked below, we explore these dynamics as they relate to emerging technologies and opportunities within payments, lending products, and insurance. Each of these sub-sectors offer a unique promise to transform key parts of the construction industry and take us one step closer to a smarter, more productive, and more profitable future.
Read the full whitepaper HERE.
Macro/Thesis: It’s no secret that the Construction sector has suffered from abysmally low productivity. Our thesis is that a big source of inefficiency stems from the industry’s poor flow of capital.
Research: Our exploration led us to diving into three key ways value is currently being exchanged — the sizing of all three are massive and the pain points are substantial:
- Payments are slow and create strain on businesses throughout the construction value chain.
- Insurance is an expensive source of cost for businesses in the construction industry with premiums expected to rise.
- Lending is a crucial lifeline in construction, and liquidity is a constant constraint for businesses.
Conclusion/Opportunities: We concluded that FinTech products in Construction need to offer verticalized solutions to drive success of adoption. Due to the industry’s unique demographic and great deal of complexities, we believe that products need to be purposely built for specific industry use cases. We also think category expertise amongst founding teams are critical to build a product that the industry accepts.
Our Summarized Slide Deck:
We provide a fun, casual and candid atmosphere to learn about innovation in the industry. CREtech is where the commercial real estate industry comes to discover all things tech. Our mission at CREtech is to connect the commercial real estate and tech sectors, bringing a new age of innovation and growth to the industry.