In the construction business, time is money. But with so many moving parts, it can be extremely challenging for construction companies to manage the administrative aspects of their finances. Adaptive, an 11-month-old startup that has set out to give construction teams better tools to manage their back offices, has raised $6.5 million in a seed round led by Andreessen Horowitz (a16z). This adds to the $750,000 the company raised in pre-seed funding last August.
Notable Investors and Backers
Notably, founders and executives from companies such as Airbase, Brex, and Ramp — which ironically all compete with one another — also put money in the round along with 3KVC, BoxGroup, Exponent, and Definition. Also among Adaptive’s backers is an unnamed construction accounting firm with 100 customers across the country.
Adaptive’s Offering
Adaptive’s offering is targeted toward general contractors, but not giant ones — think more SMBs, many of which might not have the resources to hire accounting staff. It’s being built on the premise that current methods for GCs to stay on top of spending are "time consuming, error prone, and yield very limited visibility into project performance," which can cause disputes between parties.
The Problem with Current Methods
There are many transactions conducted in any given project, and each requires multiple steps for approval and reconciliation. This process is not only time-consuming but also prone to errors, which can lead to further complications down the line.
Adaptive’s Solution
Co-founder and CEO Matthew Calvano said in an interview with TechCrunch: "I think what we’re trying to solve is a problem that’s really specific to the construction industry. We’re trying to help contractors and builders get more visibility into their costs, and make it easier for them to manage those costs."
Adaptive’s solution involves using machine learning algorithms to analyze financial data and provide insights to construction companies. This allows them to make better-informed decisions about their spending and project management.
The Future of Construction Tech
The construction industry is ripe for disruption, and Adaptive is poised to be a major player in this space. With its innovative approach to financial management, the company is well-positioned to help construction companies streamline their operations and reduce costs.
Investors Weigh In
Commenting on the investment, Calvano said: "We’re thrilled to have Andreessen Horowitz leading our seed round. Their expertise in scaling startups will be invaluable as we continue to grow."
Conclusion
Adaptive’s $6.5 million seed funding is a significant milestone for the startup, and it marks an exciting new chapter in the company’s journey. With its innovative approach to financial management and a strong team behind it, Adaptive is well-positioned to make a major impact on the construction industry.
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