After investing in modular construction startups, private investors are shocked to learn that many contractors are already using modular construction methods at various points in their construction supply chain. Even more shocking is that advanced thinking top tier contractors down to unsophisticated small specialty contractors are making money on modular. Savvy tech investors aren’t sure how less savvy construction business owners and investors caught on to the trend at the same time or ahead of when they decided to invest.
During a round table discussion at the local pub, various construction company leaders and owners like the publicity that the tech investment has created as they now have clients that are deliberately looking for modular construction abilities and prefer businesses with a combination of traditional and modular construction savvy. Asked to elaborate on what clients like, the construction pro said, “When a client asks me about modular, I start with saying it isn’t one size fits all but that’s ok. It’s gotta be incorporated into the contract documents at the right time and even with modular, traditional construction means and methods are required to build a complete project. You still need to be skilled at both to build great projects. Then, I drop the hammer on the startups because I can honestly say my company has been building modular in some form or fashion for over a decade. Now, all of a sudden, we have skill and wisdom with something that is supposedly innovative and cutting edge. This gives a client a sense of comfort and they almost never look elsewhere after conversations like this.” Essentially, with all the recent news and hype associated with modular construction, traditional builders with modular capabilities get free advertising. Every time a new investment round or modular success story gets published, any company with modular capabilities receives free advertising.
A quick Google search will reveal that startups have next to no modular experience when compared to many industry veterans. In fact, much of the modular experience tech startups claim is for their wealthy investors. When discussing this point, another construction pro chimed in with, “I’d go broke pretty quick if I only built projects for myself. My resume would also be pretty short and the lack of experience would be transparent.” A smaller builder added, “With a resume like theirs, I’d never be able to get work. I do have to give them credit because they’ve sold themselves as modular experts and pros with next to nothing backing their claim. If I, or any of us, could advertise and sell myself as well as these companies and their investors are able, with the resume we have, we’d have more work than people and resources real fast.”
Interestingly, at least one of these companies is starting to revert back to their tech investor roots with software. Realizing the dumb contractors they are trying to compete with actually know what they are doing, they have diversified into providing a project management software. While this may seem smart, there are quire a few advanced construction software companies and startups that are ahead of the curve on this challenge, as well. When this struggles, these firms will raise more money and more momentum by guaranteeing moon construction in less than a decade.
***This was another Fake Construction News article. If you liked it, stay tuned for more. If you did not like it, you may take your laughs elsewhere.***
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