Construction technology is a growing market because the industry is facing declining productivity, high material costs, a labor shortage and increased construction spending. Technology could solve many of those challenges.

According to a new report from Jones Lang LaSalle Inc., venture capitalists have invested $1.05 billion into construction technology in the first half of 2018 alone. That’s a record high. With six months left in the year, investment volume is already up nearly 30 percent compared to 2017’s total. Since 2009, venture capitalists have invested $4.34 billion in construction technology.

According to the report, 63 construction technology start-ups are focusing on collaboration software, more than any other technology. These types of programs allow architects, engineers, project managers, general contractors and others to share documents through a common schematic. Optimizing workflow is one way to improve the efficiency of the construction process.

Offsite construction is a major focus of 49 start-ups. This innovation allows companies to fabricate building components, such as unitized curtainwall, offsite and then ship them to the jobsite for rapid assembly.

Other areas being explored by start-ups are cloud-based and mobile programs, monitoring technology, 3-D visualizations, building information modeling (BIM), drones, building materials, robotics and supply chain management. A recent report shows that drone use is on the rise among large companies.

“Offsite construction, cloud-based software and new tech-focused hardware are capturing the largest investor dollars and customer bases,” reads the report. “Artificial intelligence and big data solutions are a close second, but are positioned to make even larger impacts.”

The top five start-ups, based on total funding, are:

  • Katerra – The company is valued at $3 billion and has $1.1 billion in total funding. Its product focuses on offside construction for the residential and commercial markets.
  • Zhaogang – The Chinese company is valued at $1 billion and has $361 million in total funding. It specializes in a materials trading platform.
  • Uptake – The start-up is valued at $2.3 billion and has $287 million in total funding. Big data analysis and artificial intelligence are its major focuses.
  • Procore – The cloud-based management software is valued at $1 billion with $180 million in total funding.
  • Blu Homes – The residential offsite construction company is valued at $527 million and has $180 million in total funding.

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