Slow Build: Construction Tech Exits Hold Steady

Since 2012, construction tech exits have seen steady growth with some slowdown in the last couple of years, following a similar trajectory to overall deals and funding to the space. The construction industry has seen 38 total M&As and IPOs since 2012, with 2015 and 2016 exits remaining stable and maintaining the annual record for construction tech exits.

We define construction tech as startups working on construction design, team collaboration, and project site-management, as well as those using drones and big data analytics primarily to transform the traditional mapping and surveying of construction sites.

Using CB Insights data, we analyzed first exits in construction tech since 2012. We also created a timeline showcasing construction tech first exits between 2015 and 2017 YTD (6/26/17).

Annual exit trends

In 2016, there were 9 construction tech exits, which were all M&A transactions, the same as in 2015. 2017 has seen 2 exits, both acquisitions, thus far.

The most well-funded construction tech startup with disclosed funding, with one of the largest exits since 2012 is IronPlanet, an online construction and agricultural equipment auction company, which was acquired by Ritchie Bros. Auctioneers in Q3’16 for $758M and raised $177M in total funding.

The industry has only seen 1 IPO to-date, which went to collaboration software provider Textura in Q2’13. The company had raised over $14M in total funding.

Construction Tech Exits Timeline (Q1’15 – Q2’17 YTD 6/26/17)

To analyze the timeline of exits and investors in the sector, we used CB Insights data to plot each startup’s respective exit since 2015 – 2017 through 6/26/17.

Key takeaways:

• Since 2015, there have been a few corporates that have made multiple acquisitions including JDM Technology Group, Trimble, and Roper Technologies.
• While the majority of exits since 2015 went to digital collaboration software providers, a diverse group of construction tech startups have exited including design technology providers, data and analytics tools, and financial management solutions.
• All 2015 construction tech exits went to early-stage companies with little or no disclosed funding while exits from 2016 onwards included a few companies that raised significant funding. For example, sustainable building company Sefaira, which raised $20M in total funding, was acquired by Trimble in Q1’16.
• While the majority of acquirers in the category are enterprise software providers for the AEC (architecture, engineering, and construction) industry, a couple of well-funded startups are beginning to make construction acquisitions including drone solutions provider Airware, which acquired drone data analytics company RedBird in Q3’16, and co-working unicorn WeWork, which acquired field management app Fieldlens in Q2’17.
• Also making strategic acquisitions are incumbents equipment manufacturer Caterpillar and location-based technology provider Trimble. As previously noted, Trimble has made 2 acquisitions since 2015, both of which went to design software solution providers. Caterpillar acquired equipment sharing marketplace Yard Club in Q2’17, which marks the company’s first acquisition in the space since 2010.