The construction industry has fallen behind when it comes to adopting modern technology.
According to a McKinsey study on digital transformation, construction ranks second to last - 21st out of 22 industries only ahead of agriculture/hunting. With construction representing more than $10.5 trillion per year and 16% of the global GDP, the cost of slower digital adoption is starting to compound dramatically.
One of the greatest costs has been bad data, which is estimated to have cost the construction industry $1.84T in 2020. The profitability leaks are caused by poor decision making and the fact that 14% of construction work is avoidable rework that totals nearly $89 billion annually. For a contractor with $1 billion in annual revenue, unnecessary costs could be as as high as $165M per year in avoidable rework and poor decisions. For an industry that operates on low margins already, this could be the difference between success and failure.
That is why we’re excited to announce our investment in Toric, a no-code data platform that helps construction firms aggregate, manage and visualize their project data, fueling data-driven decisions that increase the efficiency and profitability of their operations.
The software tools that construction firms have adopted like Revit, PowerBI, Dynamo and Excel, aren’t integrated with one another, and have created data silos within organizations. This results in decisions being made based on incomplete, misleading, and stale data, reflected in the vast majority of construction projects ending up over budget and behind schedule.
Toric’s data workspace solves this fragmented decision-making process by centralizing construction companies’ most under-utilized asset: their project data. Today, this data is manually synchronized through difficult-to-track spreadsheets which are often lost or not kept up to date. Toric replaces these spreadsheets by creating data pipelines between the software tools a construction firm uses, bringing their data under one virtual roof before applying a layer of automation and data analytics to automate workflows. Toric’s unique approach, employing both automation and connectivity, provides visibility into the status of a project at all phases, helping construction companies hit their two most important metrics: budget and timeline.
We’re excited by Toric’s mission of bringing modern data infrastructure to an industry historically neglected by most software companies. Construction is essential to the cities and structures we interact with each day. The extent to which such a critical industry is behind on harnessing data feels surprising: a recent study indicated that one-third of leaders in the construction industry estimate that more than 50% of their project data is bad. Bad data leads to bad decisions, and in an industry with such slim margins and tight deadlines, the cost of these decisions is unaffordable.
The legacy data infrastructure still active within most construction firms piqued our interest in Toric’s sleek, centralized approach to data management.
In addition to the market being large and the problem being mission critical (poor decisions on budget and timeline at scale can bankrupt construction firms essentially overnight), Toric’s team is highly qualified to solve this problem.
Co-founders Thiago Da Costa and Dov Amihod spent half a decade building Lagoa, a 3D mechanical CAD design and visualization cloud-based app, acquired by Autodesk in 2014. They then spent 5 more years at Autodesk working on its data and cloud platforms, where they identified outdated data infrastructure as the key problem that needs to be solved in construction.
After building quietly in stealth since late 2019, Toric is launching publicly alongside a $16M Series A funding announcement, led by Leaders Fund and Storm Ventures with participation from industry veterans like Carl Bass (Autodesk CEO 2006-2017 and board member) and Ralph Gootee (Plangrid co-founder). With their product in-market at industry leading construction firms like AECOM, Dubé, and Commodore Builders, Toric is spreading through the construction industry, reaching firms who want to reshape how they interact with their data. Learn more at Toric.com.