Strategic buyers look to capitalize on construction data demand
The construction data industry is fragmented, and there is a growing demand for technology that will help contractors, drawing deal activity particularly from strategic buyers.
Autodesk Inc. (Nasdaq: ADSK) bought PlanGrid, a provider of construction productivity software, for $875 million. PlanGrid’s software allows contractors to access in real-time project plans, punch lists, project tasks, progress photos and daily field reports. “There is a huge opportunity to streamline all aspects of construction through digitization and automation,” says Autodesk CEO Andrew Anagnost.
“At PlanGrid, we have a relentless focus on empowering construction workers to build as productively as possible,” adds PlanGrid CEO Tracy Young. “One of the first steps to improving construction productivity is the adoption of digital workflows with centralized data. PlanGrid has excelled at building beautiful, simple field collaboration software, while Autodesk has focused on connecting design to construction.”
Autodesk and PlanGrid have complementary construction software. Autodesk’s BIM 360 construction management program connects people, data and workflows on construction projects. PlanGrid’s technology lets general contractors, subcontractors and owners in the commercial and civil industries benefit from real-time access to project plans, punch lists, project tasks, progress photos, daily field reports and submittals.
Autodesk also has a deal to buy BuildingConnected for $275 million. BuildingConnected has a network of more than 700,000 construction professionals, helping real estate owners and general contractors find contractors for their projects. BuildingConnected’s customers include Turner Construction, McCarthy, Mortenson, StructureTone, Skanska, Clark Construction, Ryan Companies and Aecom. “Bid management is a critical step in preconstruction, since bidding is the genesis of construction projects,” says BuildingConnected CEO Dustin Devan. “We are investing in digitizing and automating construction workflows,” adds Anagnost.
Along with bid management, BuildingConnected offers TradeTapp, a subcontractor risk analysis software program, and Bid Board Pro, which helps subcontractors manage and win more bids. BuildingConnected claims that it is the only bid-management platform that provides general contractors and owners with project-specific risk mitigation recommendations based on subcontractor qualification data. This helps contractors efficiently vet and make more informed decisions when selecting subcontractors.
Autodesk is not the only company seeking acquisitions in the construction data sector. In 2018, Trimble (Nasdaq: TRMB) bought construction software company Viewpoint from Bain Capital for $1.2 billion. Viewpoint’s technology helps contractors with finances and project management. Trimble says the acquisition complements the company’s e-builder business. “The construction industry is embarking on a major digital transformation," says Viewpoint CEO Manolis Kotzabasakis. "And together with Trimble we will further accelerate technology innovation and adoption to deliver even more value to our customers."