The construction is expensive. In a city like New York, the average cost of construction in 2017 was over $ 354 per square foot; in Zurich, the most popular region in the world, the price was $ 328 per square foot. Building materials and labor add up, and although real estate investments in the world's most expensive cities exceed tens of billions collectively ($ 14.3 billion in New York alone in 2016 ), funds are not always paid when they need it the most.
Billd wants to make sure that such funding gaps rarely occur. The financial technology firm, which quietly obtained $ 8.4 million in equity financing in November 2018, works with regional and national materials suppliers in the United States to provide short-term loans to entrepreneurs of construction. It appears that the demand for its services is sound: The Austin startup has announced today that it has raised $ 60 million of debt and equity financing under the umbrella of the company. a financing round led by LL Funds, an independent investment firm specializing in fixed income securities and specialized consumers. finance investments.
Billd's CEO, Chris Doyle, said the capital raised would be used to "expand product capabilities" and expand operations.
"The construction sector is known for its inefficient supply chain financing in all major sectors, and subcontractors and suppliers are the last," he said in a statement. "Billd offers solutions to subcontractors so that they can take on this additional project, expand their business and simplify their process, while providing suppliers with more payment options to share with their customers."
Typically, building materials suppliers expect a payment of building materials within 30 days, which is a much narrower window than 60 to 90 days on average for contractors to receive payment for their work. Billd solves this problem with durations of 120 days. When entrepreneurs sign up, they receive a range of financing options for item orders, which suppliers can view and approve on the same day. Contractors pay a fixed monthly interest rate – no application fees – and suppliers receive immediate guaranteed payments from Billd on their behalf.
Billd says he is currently working with "thousands" of entrepreneurs in the United States.
"LL funds focus on asymmetric investment opportunities, where we can combine our vast experience in lending, capital markets and risk management with disruptive business approaches, particularly in such important sectors. than the construction sector in the United States, "said Shivraj Mundy, LL Funds' operating partner who will join Billd as executive chairman. "We are delighted with this opportunity to significantly improve the supply chain financing in the construction sector."
Startups in the construction sector have not been so surprising: analysts estimate that the global industry has $ 10 trillion. In the third quarter of 2018 alone, construction start-ups in North America collected $ 220.7 million, an increase of 348% from $ 49.3 million in 2017. In addition, architectural, engineering and construction companies attracted $ 1.38 billion in investment. CB Insights, clearing the record of 2017: $ 882.3 million.
In July 2018, Katerra, an end-to-end construction services provider valued at more than $ 3 billion and backed by SoftBank, announced plans to open a state-of-the-art manufacturing facility in Tracy, California. Finalcad, headquartered in Paris, provides software to help construction companies manage their processes and learn from predictive analytics. He brought in $ 40 million at the end of last year. And the Tel Aviv-based Intsite freelancer company secured $ 1.35 million in pre-seed funding in September.