Japanese conglomerate SoftBank Group Corporation is throwing its hat in the construction ring with an $865 million investment in Katerra Inc.
Katerra, a young Silicon Valley startup, wants to innovate the entire construction industry by implementing an assembly line-like procedure for all housing and commercial building construction projects, according to the Wall Street Journal.
Michael Marks, the man who influenced Microsoft to become a hardware company and changed the way contract manufacturing worked in major tech firms, is now taking the plunge into construction as the co-founder of Katerra.
He envisions an entirely new approach to construction; one that would place Katerra in charge of everything. This differs from typical construction projects where the head developer subcontracts the workers they need to accomplish a job.
“We’re a fully-integrated turn-key supplier for developers,” Marks told Forbes. “So a developer comes to us with a piece of land. We design the building, we engineer the building, and we build the building.”
Since there are 7.8 million production workers in United States construction currently, there will likely be no shortage of applicants for this new and highly structured concept driven construction company.
Katerra seems to be on the right path, as the Softbank contribution just sent them cascading to a business valuation in the billions.
Customers seem to be trickling in as well, attracted by relentless good news of additional financial backers. As a risky start-up, the propensity for aversion should be high, but companies are buying the idea.
“Our customers that are rolling in — many of them are big companies, some of them are public companies,” Marks said
This could be a boon for the already growing U.S. construction economy, and could likewise mean an increased demand for construction-related jobs.
Since manufacturing is responsible for two-thirds of welding jobs, and construction employees a significant portion of welders as well, Katerra, the company that does it all, might just be a new and welcome home for many different trade workers.
Michael Marks has promised a lot to investors and consumers, yet does not feel that he’s bitten off more than he can chew. As Katerra angles to become the world’s first one-stop shop for architectural design, engineering, material supply, manufacturing, interior design, and construction, Marks has this to say:
“It is a lot, but it is what we’re doing. You look at these things individually and we think of them as all one service.”
In the next two years, Katerra expects to build four more factories in America.