Updated: Sep 17, 2020
It is not controversial to state that construction productivity over the last 75 years has increased slowly, at best. That almost every other major industry has seen material productivity gains over this same period. That our industries are suffering from a global skilled labor crisis. That there is a global need for new and improved infrastructure and affordable housing. And that the complexities of construction projects and fragmentation of construction stakeholders make innovation adoption difficult to address.
It is not controversial to state that the construction industry is essential and delivers products that serve as the backbone of functional societies. That the quality and quantity of construction products is highly correlated with, and likely determines, the level of sophistication and broader value-production ceilings of these societies. That government and private spending on construction will continue to increase into the future. That the foundational technologies are in place – cloud, connectivity, mobile, UI/UX – to enable more efficient development and adoption of purpose-built solutions. And that we are officially in the early innings of Industry 4.0.
Ironspring is investing in the 4th Industrial Revolution. We are life-cycle investors and look to partner with innovators in the early stages of their journey. We evaluate many form factors of technology and innovation that impact different aspects of the industrial value chain.
One of our core focus areas is automation. Automation comes in different forms and serves different purposes across the industrial value chain, but within construction, there are two major trends relevant to highlight now: (1) automation of traditional, physical tasks on-site, and (2) automation of modular construction off-site. When we zoom into residential construction, we know homebuilding is one the largest markets on the planet. There is a need for significant advancement in both on-site and off-site automation. And the global housing market has the capacity and demand to support multiple “winners” in both categories.
The U.S. has seen median home prices explode over the past 20 years. In 2016, home prices rose twice as fast as inflation. Further, housing prices exceeded wage growth in more than half of the country. The homebuilding market is also very fragmented with more than 90% of builders doing less than $5M. How can innovation scale across this fragmentation? And at the highest level, an estimated 1 billion humans do not have access to adequate housing. These are real problems. But the home building process has remained largely unchanged for the past 1,000 years! What is the definition of insanity?
Enter ICON – who refuses to do more of the same. We are proud to partner with ICON as part of their $35M Series A to accelerate their transformational breakthroughs in the future of autonomous, 3D printing construction. Led by Moderne Ventures, we are proud to join a great syndicate of investors including BIG - Bjarke Ingels Group, CAZ Investments, Citi, Crosstimbers Ventures, Next Coast Ventures, Oakhouse Partners, Trust Ventures, Vulcan Capital, and Wavemaker Partners. ICON is a trailblazer with a resume to match … from achieving the first permitted 3D-printed home in the U.S., to building the largest mobile construction 3D printer in the world, to delivering the first fully automated material delivery system, to breaking ground on a 3D-printed housing community in Tabasco, Mexico (watch their Apple TV+ episode on “Home”), to protecting our soldiers with novel DoD structures… ICON is a leader.
ICON is addressing the three critical problems to homebuilding – affordability, sustainability, and availability. They are doing so by decreasing costs of construction, increasing speed of delivery, and simultaneously improving performance of the product. We are excited about the potential design freedoms made available at scale through 3D printing. We do not believe hyper-density living will single-handedly solve the housing crisis, nor should it. Single-unit, detached housing remains the most popular and desired kind of housing on earth. Not so coincidentally, this type of housing represents one of most fragmented and inefficient construction industry sectors. ICON is positioned to drive step function construction productivity gains in detached, single-unit housing in a revolutionary way.
Being Texas neighbors, I have known Jason, Evan and Alex for many years. We will continue to repeat that the single most important investment criteria to Ironspring is sharing fundamental alignment of values with founding teams that have deep domain expertise. This is certainly the case here. These guys are what I like to call methodical visionaries. Realizing the grand vision of ICON will only be achievable through bite-sized, coordinated, technological breakthroughs. Since we began our relationship nearly 5 years ago, they have routinely exceeded expectations and executed ahead of plan. Stay tuned as their big vision will continue to unfold for the world to witness and benefit from.
You can read more information in the articles below:
ICON Website: https://www.iconbuild.com/