Dive Brief:
- New Orleans-based startup zlien, a cloud-based mechanics lien management company, has raised $5 million in growth equity investment in a funding round led by Altos Ventures.
- The company said this latest investment will fund expansion in sales and marketing as well as pay for software development and continued innovation.
- According to zlien, it has facilitated the construction-payment and lien-waiver-exchange processes for more than 300,000 projects and is "delivering a 21st century solution to managing mechanics lien rights" for contractors, suppliers, developers, lenders and owners.
Dive Insight:
Also active in this latest funding round is previous investor Brick & Mortar Ventures, which led the company's $1.3 million investment round in March. Brick & Mortar head Darren Bechtel said that the "construction payment process is too messy" and that zlien is making it possible for companies to "better communicate and to trust one another." Additional investors include Knollwood Investment Advisory, Operating Venture Capital and Cajun Kiwi Investments.
Technology companies like zlien are increasingly streamlining common construction industry processes like lien waiver management, blueprint organization and everyday project management tasks. This is a welcome shift considering that a May World Economic Forum study determined that the construction industry's productivity improvements have been "meager" compared to other industries during the last 50 years. The report suggested that improvement in the areas of "digitization and construction techniques" was the path to increased productivity. If the world construction industry could reduce costs by only 1% through such efficiencies, the WEF said, it would save an estimated $100 billion annually.
The WEF concluded that adoption of Lean construction techniques could cut costs by 17% and reduce production time by 30%. Digitization could not only cut operational costs by 17% but capital costs by up to 21%. None of these advancements matter, however, if the "fragmented" construction industry as a whole does not develop standards to be used by all.
