Two big trends that continue to soar in the construction industry are M&A (merger and acquisition) activity and funding from investors—both topics we have written about quite a bit here at Constructech in recent years, but now it seems the activity is happening at a faster pace than ever before, and it could be good news for the construction industry.
While it is never this cut and dry, generally speaking, M&A and funding can be viewed as two sides of the same coin. In many instance, not all, M&A often joins one company within another, leading to fewer companies in the market and less competition. On the other side, funding from investors often give new companies the boost they need to compete against tried-and-true companies who have been serving the market for years.
One example comes from Assignar, which recently received $6.2 million in series A funding. The cloud-based SaaS (software-as-a-service) platform is built for construction subcontractors and self-perform general contractors to improve visibility into field operations. Further, it can help manage project scheduling including the workforce; assets and materials for projects; and ensure safety, quality, and compliance processes.
The company’s CEO Sean McCreanor founded the company to help solve the operational problems he faced in the construction business he owned and operated. The solution now allows other subcontractors and self-perform GCs the capability to grow revenue, gain visibility into their operations, and improve efficiency.
While this is simply one example, an infusion of funds into companies is one way to spur competition in the construction-technology space.
At the same time, M&A activity is happening at a very fast pace—just look at all the acquisitions that were announced at Bentley Systems Year in Infrastructure 2018 Conference. As another example, Hexagon AB announced the acquisition of Bricsys, a developer of CAD (computer-aided design) software that provides open, collaborative construction technology solutions. The company says this acquisition will extend its experience in building design—and it can provide an end-to-end platform.
That is perhaps one of the biggest benefits of M&A activity, spurred innovation and integration. Once acquired, many technology providers aim to create an integrated, end-to-end software platform, creating more value-add for customers. It is a great vision—one that many technology providers continue to reach for.
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