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Existing backers Eniac Ventures, MetaProp NYC, and Darling Ventures participated in the investment, which brings Briq’s total raised since its 2018 inception to $16 million, according to Crunchbase data.
Briq CEO and co-founder Bassem Hamdy is a former executive at construction tech unicorn Procore and Canadian software giant CMIC. He came up with the idea for Briq after realizing the vast amount of inefficiencies on the financial side of the construction industry. His goal was to do for construction financials what Procore did to document management, and PlanGrid to construction drawing.
Briq’s construction fintech (ConFinTech) SaaS platform digitizes construction financial data by applying advanced analytics and artificial intelligence (AI) “to help power decision making and improve profitability at construction companies of all sizes,” the company said. Specifically, Briq uses automation, predictive modeling and analytics to streamline workflows, and also to identify patterns and model outcomes for more accurate financial forecasting.
Put simply, Hamdy aimed to solve the age-old problem of construction projects (very often) going over budget.
“I wanted to figure out how to bring the best of fintech into a construction industry that really guesses every month what the financial outcomes are for projects,” he told Crunchbase News. “Getting a handle on financial outcomes is really hard. The vast majority of the time, the forecasted cost to completion is plain wrong. By a lot.”
In fact, according to McKinsey, a staggering 80 percent of projects run over budget, resulting in significant waste and profit loss.
So at the end of a project, contractors often find themselves having spent more money and expended more resources than originally planned. This can lead to negative cash flow and a loss of profit.
“Our platform helps them identify outliers, and which projects are at most risk,” Hamdy explained. “The risk coefficients calculate for them based on different financial factors, such as how they are using funds such an allowance or contingency.”
A smart strategy
Hamdy enlisted Wall Street veteran Ron Goldshmidt to serve as Briq’s co-founder and COO.
Together the pair came up with a smart strategy.
Many chief financial officers (CFOs) of construction companies are accustomed to using spreadsheets on Microsoft Excel. So, why not create a platform that resembled Excel to ease people into its use and adoption? (The construction industry has historically been slow to adopt technology.)
The plan seems to be working so far.
Over the past year, ARR (annual recurring revenue) has jumped by 1,000 percent, according to Hamdy, albeit from a small base. Sales cycles are as short as nine days, he said.
“We’re catching so many errors early on that we’re getting great traction,” Hamdy said.
General contractors and subcontractors of varying sizes are among Briq’s nearly 70 current customers. They include Harper Construction, Wescor Cos. and Western States Fire Protection.
“Anybody that has to do financial forecasting is a potential client,” he said.
For now, Briq is focused on the U.S. and Canadian markets.
The 40-person company has headquarters in Santa Barbara, California, but is primarily remote with offices in Toronto and India.
Briq plans to use the new capital budgeting to expand its platform.
“Forecasting is only the tip of the iceberg,” Hamdy told Crunchbase News. “We want to digitize and modernize the entire financial stack for a construction company.”
For his part, Luke Cope, CFO of Western States Fire Protection, said his company has already saved hundreds of hours and tens of thousands of dollars by using Briq’s platforms.
Meanwhile, Wescor CFO Kevin Booth said his company processes over 450 individual field payrolls every week. Briq analyzed its labor budget transactions for variances of 20 percent or more.
“We were shocked to find the number of discrepancies,” he said in a statement.
Zach Aarons, co-founder of MetaProp said doubling down on Briq was a “no brainer.”
The startup, he said, gives construction companies a way to get a better understanding of their previously siloed data.
Ray Levitt, operating partner at Blackhorn Ventures, sees the startup as an example of how to apply business intelligence methods and machine learning algorithms to automatically integrate legacy systems “to create comprehensively integrated data pools.”
Ultimately, he sees the startup as a pathway to innovation.
“Briq’s platform allows for high-level value creation insights for project and C-level executives, allowing them to dramatically enhance the efficiency and effectiveness of both their operations and business development activities,” he told Crunchbase News. “Briq is in a clear pole position to move the construction industry towards advanced digitization paths.”
Illustration: Li-Anne Dias
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