When you think about platforms in the construction industry, chances are the concrete slabs designed to support steel beams and tall pillars will come first to your mind. Munich-based startup Comstruct wants to design a different kind of platform for the construction industry — a software platform.
At its core, Comstruct is a procurement platform for construction materials. For large-scale projects, processing materials orders can take a lot of time, as materials providers still print out delivery notes and invoices. Orders are often placed over the phone, and it can be difficult to reconcile invoices and create comprehensive data reports.
“Today, the procurement process of materials in construction is very analog. You could place a phone call to order 10 cubic meters next Thursday. Then you get a physical delivery note on the site that is then typed out into an Excel sheet,” Comstruct co-founder and CEO, Henric Meinhardt, told TechCrunch. “And then they’d sometimes send it via post to the headquarters, where they then manually compare invoices to the receipts.”
Each materials supplier could build its own app to process orders, but the problem is that contractors don’t want to deal with 100 different apps to get documents. That’s where Comstruct comes in with its platform that can unify these processes.
Comstruct first contacts general contractors to understand how they get their materials, as they generally work with myriad suppliers depending on the location of the construction sites and other specific needs.
“We approach those material suppliers. We call them and ask them: how can you share the data? Do you have an EDI interface? Do you have an email where you can forward the information? Do you have a customer portal that we can scrape to find materials? And then we structure the information,” Meinhardt said.
The startup then uses machine learning to integrate each supplier on its platform. “This technical improvement enabled us to integrate 800 material suppliers over the last two years, which is quite a significant amount already,” Meinhardt said.
On top of this data layer, Comstruct has built four modules around ordering, digital delivery receipts, invoice reconciliation and ESG reporting. The startup runs on a usage-based pricing model with a simple per-document pricing strategy.
“With the [Corporate Sustainability Reporting Directive] in Europe, [contractors] need to report how much material went into construction projects. Until now, they didn’t know how much concrete they used […] that’s a number they didn’t have,” Meinhardt said.
Comstruct competes with Kojo in the U.S. and Qflow in the U.K, but each competitor has its own positioning. According to Meinhardt, Kojo “focuses a lot more on the procurement side,” while Qflow “focuses a lot on waste management.”
The company originally started working in Switzerland because Meinhardt studied there. Comstruct claims that it already has good coverage of the materials industry in that country, and it has 70% to 80% of requested suppliers on its platform already. The company is currently expanding to Germany, Austria and other European countries depending on construction projects.
Some large-scale construction sites have used Comstruct already to manage construction materials, including several tunnel projects, a highway project in Stockholm and a big train project in Munich. For instance, the Gotthard Tunnel project in Switzerland (pictured below) relies on Comstruct to handle all delivery notes and link them to invoices.
