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Construction technology is a growing sector, which is why Brick & Mortar Ventures has raised a $97 million fund to invest in both hardware and software for construction-related industries.

The San Francisco venture fund was founded by construction tech investment veteran Darren Bechtel and is backed by high-profile corporate funding sources.

The fund targets emerging companies developing innovative software and hardware solutions for the industries of architecture, engineering, construction, and facilities management. The firm has already invested in 16 companies through an earlier fund.

Bechtel, who serves as managing director, has been investing personal capital into Built World technology startups since 2012, beginning with his contribution as the largest investor in a seed round for PlanGrid (acquired by Autodesk in November 2018 for $875 million).

“We are excited to formally announce our first institutional venture capital fund and publicly introduce our corporate strategic investors and partners,” said Bechtel in a statement. “While angel investing across a wide variety of verticals, I observed that out of my portfolio of roughly 40 companies, the Built World investments were standout performers and looked to be the start of a larger trend.”

Above: Brick & Mortar Ventures wants to disrupt construction.

Image Credit: Brick & Mortar Ventures

He added, “Whether by good intuition, pure luck, or something in between, my first four construction tech investments were into the seed rounds of PlanGrid, BuildZoom, BuildingConnected, and Rhumbix. The rapid growth, impact, and early success of these companies strengthened my conviction there was ‘gold in them hills’ and now was the time to invest and double down on our built world tech investment thesis.”

Brick & Mortar’s money came from powerhouses in the construction value chain, including Ardex, Autodesk, Cemex, Ferguson Ventures, FMI, Glodon, Haskell, Hilti, Obayashi, Sidewalk Labs, and United Rentals.

Such organizations enjoy a strategic relationship with the Brick & Mortar team so that each is able — if it chooses — to share information concerning challenges its organization faces; collaborate on opportunities it sees; and explore emerging technology solutions that might be available for proof-of-concept pilots, codevelopment, or commercial use.

The Bechtel Group — a 120-year-old multinational engineering and construction firm founded by Darren’s great-great-grandfather and run today by his brother, Brendan Bechtel — is not an investor in Brick & Mortar or any of its portfolio companies. However, due to Darren’s familial and past professional relationship with Bechtel, Brick & Mortar considers the company a preferred industry partner, along with its anchor investors.

These partners work with Brick & Mortar to identify industry challenges, explore solutions, and consider the benefits offered by early-stage companies, whether or not Brick & Mortar is an investor in the startup in question. In addition to the individual support and partnership between the firm and each Preferred Industry Partner, Brick & Mortar facilitates knowledge-sharing and direct collaboration.

“We are excited to be a Limited Partner of Brick & Mortar and support their efforts to accelerate promising startups that are developing built-for-purpose solutions for the construction industry,” said Kevin Barnes, managing director at Ferguson Ventures, in a statement. “Darren, his team, and the participating industry-leading LPs will add tremendous capability to our industry.”

Since its initial closing of its first fund in January 2018, Brick & Mortar has already built up a portfolio of 16 deals from its current fund: ManufactOn, FieldWire, Serious Labs, BuildingConnected (acquired by Autodesk), Branch Technology, Canvas, Cumulus, Connect Homes, Illumagear, SafeAI, Veerum, Ynomia, Curbio, Wingtra, Timber, and SafeSite.

The firm plans to continue to lead seed and series A rounds globally with a focus on the U.S., Canada, Europe, and Australia and to invest between $1 million and $4 million into new opportunities, with reserved capital for follow-on participation over the life of its portfolio companies.

“Brick & Mortar has shown a true commitment to creating value for their LPs, not just talking about it,” said Cutler Knupp, director of strategy and technology investments at Dysruptek, the CVC arm of Haskell, in a statement. “Industry expertise, in combination with a disciplined focus on real solutions that scale, sets Brick & Mortar apart. They have a real passion for advancing technology in the AEC industry, and it shows with the quality of investments and willingness to get a little dirt on their boots. The team works hand in hand with us (the LP’s) and their portfolio companies as a true partner to build lasting value.”

Through Brick & Mortar’s expertise and strategic LP relationships, the portfolio founders gain access to incomparable industry experience and connections to leading players in the construction value chain. Brick & Mortar provides detailed feedback on product/market fit, helps shape the product roadmap, and helps companies land an early POC or pilot with a pathway to scale.

The current team of five consists of Darren Bechtel, Alice Leung, Kaustubh Pandya, Curtis Rodgers, and Austin Yount.

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