Katerra, a technology company redefining the construction industry, says it has raised $865 million in a Series D funding round led by the SoftBank Vision Fund. The financing will be used to fund Katerra’s continued manufacturing expansion and for further investment in its R&D efforts.
“The construction industry is ripe for digital disruption,” said Michael Marks, chairman and co-founder of Katerra. “Katerra leverages its own software platform to remove time and costs from building development and construction. This new round of funding will enable us to further invest in R&D and continue to scale the business.”
Founded in 2015, Katerra has already accomplished the following in less than three years:
- Accumulated more than $1.3 billion in bookings for new construction, spanning the multi-family, student and senior housing, and hospitality sectors;
- Amassed a global team of more than 1,300 people, attracting senior leadership and talent from groundbreaking technology brands such as Apple, Google, HP, Nokia, Sandisk, and Flextronics; and
- Opened a fully operational manufacturing facility in Phoenix, AZ with a roadmap in place for multiple additional domestic factories, including breaking ground on a mass timber factory in Spokane, WA.
“The $12 trillion construction industry is extremely fragmented with tens of thousands of companies using minimal levels of technology. While labor-productivity growth has skyrocketed in the overall global economy, the construction industry has averaged only 1% annual productivity growth over the past two decades,” said Jeffrey Housenbold, managing partner for SoftBank Investment Advisers.
“Katerra is leveraging the latest technologies to radically transform the way people build. Drawing on his experience leading Flextronics, Michael’s unique vision and talented team are taking the great lessons of electronic manufacturing and applying them to an industry that is in dire need of change. We are excited to support Katerra as they expand across markets and geographies and unleash a new wave of productivity.”
New investors in the round include: Canada Pension Plan Investment Board (CPPIB), a private investment fund managed by Soros Fund Management LLC, Tavistock Group, Navitas Capital, DivcoWest, and others.
In connection with the investment in Katerra, Housenbold will join Katerra’s board of directors.
Katerra’s service model and technology platform focus on delivering better, faster, and cheaper building projects, the company says in a news release. The company’s unique approach and tools include:
- A vertically integrated team to provide end-to-end building services within a single partner, including architecture, interior design, engineering, material supply, manufacturing, and construction. Katerra’s proprietary technology drives this integration by connecting Building Information Modeling (BIM) tools and computational design directly to its global supply chain infrastructure for ease of material ordering, manufacturing, tracking, and delivery.
- Integration between factories and construction jobsites, offering greater precision, higher productivity, and quality control. With materials and products arriving at construction sites just-in-time and ready to install, a Katerra job site more closely mirrors a process of precision-sequenced product assembly than traditional construction.
- A unique design approach combining product standardization with customization, providing the efficiency of manufacturing without sacrificing design freedom.
- A global supply chain of curated, high-quality products, eliminating middlemen and passing on the savings directly to clients.
Founded in Menlo Park, California, Katerra was started by Marks, Jim Davidson, and Fritz H. Wolff. Combined, they have decades of experience in the technology, manufacturing, real estate and private equity industries.
Existing investors include Foxconn, Greenoaks Capital, DFJ Growth, Khosla Ventures, and Louis M. Bacon, the founder of Moore Capital Management, LP.