Chalk up another one for construction tech investments.
On Monday, Vallejo, CA-based Factory OS filed paperwork with the SEC disclosing it raised just over $22.7 million in an equity funding round. The filing states that 17 investors participated in the deal. Identities of investors are not disclosed through SEC Form Ds. The deal was closed earlier in June.
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Factory OS is in the business of designing and building homes using pre-fabricated, modular components. Its first customer was Google’s parent company, Alphabet, which in 2017 ordered 300 apartment units from the company, according to Wall Street Journal reporting from the time. The reported value of that deal was between $25 million and $30 million. Unnamed experts cited by the Wall Street Journal said that modular, pre-fabricated construction can reduce construction costs by 25 to 50 percent in the Bay Area.
In 2018, the company opened a sprawling manufacturing facility in Vallejo which can produce 2,000 to 3,000 units per year, according to local Fox affiliate KTVU. Describing the facility, the KTVU article states that, “[h]ouses will be moved along the assembly line by cranes and industrial air cushions. At two dozen assembly stations, 150 to 250 union employees will build the modules from the inside out. The modules, some as large as 16 feet by 70 feet, will likely contain two or more living units, studio sized to multi bedrooms.”
The housing units are then loaded onto trucks and shipped whole to building sites. Factory OS is currently working on developments in West Oakland and El Cirrito.
In a recent video produced by Autodesk-sponsored site Redshift, cofounder James Pace said the company is able to reduce construction time by 40 to 50 percent over traditional building techniques. Factory OS is an Autodesk Entrepreneur Impact partner, which grants emerging startups access to Autodesk’s design software for free. Factory OS is also working to establish an independent innovation lab within UC Berkeley’s Terner Center for Housing Innovation. According to a page on Factory OS’s website, “[t]he Innovation Lab will be housed in the penthouse at Factory OS for $1 rent per year.” The innovation program is led by Carol Galante, current faculty director of the Terner Center, who previously served as the Federal Housing Commissioner for the U.S. Department of Housing And Urban Development (HUD) during the Obama administration.
Today’s securities filing discloses the company’s current board of directors, consisting of its co-founders Rick Holliday and James Pace, as well as Peter Palmisano, a non-executive director who’s serving as a “financial partner” to the venture. The three directors each have experience in the housing and building industry. Holliday is also owner of Holliday Development, a Bay Area home builder; Pace is founder and president of Cannon Constructors North; and Palmisano is a Bay Area property developer who was also a founding board member of Mortgage.com, now known as Quicken Loans.
Illustration: Li-Anne Dias
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