Commercial service technology has not been historically considered “sexy”, but the need for spatial innovation is enormous.
That need has been translated into large funding for companies focused on streamlining the commercial contract process. On Friday, BuildOps, which develops software for commercial services contractors, announced it was valuing the $1 billion-after company, raising $127 million in a Series C round led by Meritech Capital.
This rating is “more than doubled” in the valuation build achieved in the last funding. The $50 million Series B round announced in May 2023 and the $36 million salary increase “top up” only existing investors say is co-founder and CEO. The latest capital injection will raise the company’s total to more than $250 million.
Founded in 2018, Los Angeles-based BuildOps has built field service management software to help commercial contractors in the US and Canada using project management, services, dispatches and billing through what is described as “powerful AI automation.” The company claims that the software helps contractors, including HVAC, plumbing, mechanical and electrical, fire and life safety, increase efficiency, reduce costly mistakes, reduce downtime and increase profitability.
“I talk to contractors every day (…). They keep running our world and crushing our backs, but the decks stack up on them with short staff, burgeoning costs and technology stuck in the Stone Age,” Chanani told TechCrunch in an interview.
Chanani previously founded a commercial real estate group known as USA Commercial. Co-founder Neeraj Mittal was previously the engineering director at ServiceTitan. I stinted for Steve Chew, the third co-founder of BuildOps, with Microsoft, Nextag and Fundly.
According to his LinkedIn, Mittal is no longer in the company.
BuildOps operates on a Software as a Service (SAAS) model with per-user pricing configured as part of an annual contract. The company includes JH Kelly, Haynes Mechanical, Dynamic Systems, Inc. , Baker Electric and more than 1,000 commercial contractor customers.
Chanani refused to reveal the tough revenue figures, but since the company launched its platform in 2020, Buildops said it has “grown exponentially” and tripled that figure in 2021 and 2022 in three years.
Chanani said BuildOps has yet to make a profit as it focuses on “future offensive scaling and investments.”
Looking ahead, BuildOps will use new capital to expand its personnel and invest in product and technology development, particularly API architecture. We also pay attention to what Chanani described as a “strategic acquisition.”
Currently, BuildOps has around 375 employees, an increase of 50% compared to a year ago.
For Paul Madera, general partner and co-founder of Meritech Capital, commercial services are “a large and important segment of an economy that is badly unserved by modern software.”
“Alok and the Buildops team saw this opportunity early and built the most complete commercial service operating system in the industry,” said Madera, who is on the board of directors of BuildOps as part of Financing. “What we’ve heard from contractors, large and small, is that Buildops is operating and economically transforming its business. Most importantly, we can better serve our customers.”
He told TechCrunch that his company is also attracted to the fact that BuildOps focuses solely on the commercial sector.
“All customers (…) do it a little differently. That means, like any other core record system, the software must be highly configurable,” he said. “Buildops nailed the balance between depth, flexibility and ease of use of this product in a very unique way.”
Interestingly, TechCrunch Editor-in-Chief Connie Loizos became one of the “famous young startups” of 2019 with this work.
New Buckers Bond Capital and Schneider Electric’s SE Ventures also participated in the Buildops Series C round and existing backers Fika Ventures, Next47, Stepstone Group and Titanium Ventures. Early investors in Buildops include 01A (known as the O1 advisor founded by former Twitter executives Dick Costolo and Adam Bain), Founders Fund, Metaprop B Capital, 137 Ventures and Liquid 2.