The construction industry has been always been slow to adopt new technologies. However, investors are now pouring money into new construction startups, hoping the industry is on the brink of changes.
According to the Wall Street Journal, “ Venture investment in private construction-technology companies leaped to 6.1 billion in 2018, from $352.1 million in 2016. With $4.3 billion invested as of late June, 2019 is on track to be another record year.
Construction companies have been encountering labor shortages, pushing them to look for ways to build faster and cheaper.
New money being invested in these startups are businesses looking to automate parts of the construction process and make the industry less labor-intensive. For example, Katerra Inc., a company that builds components in a factory, has raised more than $1 billion from investors.
One challenge that won’t go away anytime soon is taking new construction-technology and incorporating it into affordable housing. Unlike developers who build luxury housing, affordable housing can’t charge more for rising building costs. As the industry adopts new technology, transitioning into a more economical budget range is important for changes in affordable housing to take effect.