“We have some customers who prior to using TrueBuilt were using six to eight different software platforms to complete their pre-con workflow. Now they can do that all in one place at TrueBuilt.”
The startup’s current 11-member team is applying modern technology to pre-construction, including computer vision to read and analyze blueprints, said Sibley.
“The capital is going to be spent investing in our new computer vision product,” he said. “If you think about how pre-construction is done today, even digitally, an estimator has to come in and actually draw on their screen and trace a blueprint to measure it to figure out the volume to identify where toilets and showers are. Our software can start to automate a lot of that. We actually refer to it as augmented intelligence. We don’t want it to fully replace the workflow of an estimator, we just want it to enhance it.”
Having earned an MBA from the University of Southern California during COVID, and looking to start his own company, Sibley began to study various industries that had been affected by pandemic-driven supply chain, pricing, and volatility issues. He also looked at those that lacked software solutions, an area in which he had a professional sales background.
“Construction came to the top of the list pretty quickly,” he said. “Looking at the entire construction workflow from when blueprints are first designed to when the developer actually commissions the building and occupants enter the building, pre-construction was the one workflow area that was really neglected by the software world. There were some legacy competitors and solutions out there, but there really hadn’t been innovation for pre-construction specifically.”
Also recognizing that there was a software vacuum in pre-construction, Fifth Wall became a follow-on investor in the seed round, said Dan Wenhold, a partner at Fifth Wall.
“Pre-construction was an interesting space when we started to dig into it,” said Wenhold. “It really begins with the ROI and profitability that is driven through the pre-construction process with better data and more accurate bidding. We saw the immediate ROI for the customer here with TrueBuilt software.”
Besides the aggregation of proptech software services, which is becoming increasingly prevalent in real estate and construction, Fifth Wall saw another reason for investing in TrueBuilt.
“The other thing that we look for in investments, whether we’re looking at a consumer company or software business, and it certainly applies in this case, is network effects,” said Wenhold. “TrueBuilt actually has an interesting network effect amongst its users. Today, general contractors who use the software ask for bids from subcontractors through TrueBuilt’s platform, and, as a result, you have subcontractors that start using their software.
“So you’re able to organically acquire additional users by just having your customers use the software product today. Obviously, as the business builds and more bids are put through it, you can imagine how that can get pretty interesting over time.”
That networking effect was evident to Sibley from his first customer, who went live on the TrueBuilt platform and invited 200 different subcontractors to bid on his project, said Sibley.
“So we said, ‘Wait a second, this is this natural, organic way to get in front of more customers,’ ” he said. “It creates more selling opportunities for us. So we started tweaking the existing platform to actually fit and to help out subcontractors and trade partners as well.
“Because of that, we’ve seen these very localized networks that have developed in Dallas, Phoenix and Southern California — hubs that have a lot of builders and a lot of construction going on right now.”
