Our Q&A series is an opportunity for our European team, headed up by Dilan Omari-Clark to discuss all things PropTech, Start-ups, and Career with different founders from across the continent. Each month we will ask our guests some burning questions and quiz them about their product, we hope you find it insightful and enjoy getting to know the founders as much as we have.
Vestack is based in Paris, France and was founded in 2019. Vestack seeks to disrupt the construction industry through efficient design and sustainable manufacturing processes, which are 3x less polluting, 2x faster, and at no additional cost compared to traditional construction. Incorporating their proprietary hardware and software, holistic end-to-end solution allows them to assist developers from design to delivery. Their market-leading technologies give the flexibility and agility to adjust to the requirements of any project, adapting to architectural designs, regulatory standards and environmental considerations.
Vestack ranks among the most promising civil engineering startups in France in 2021 based on criterias of innovation, growth, management and societal impact.
The construction industry is one of the most backwards industries on earth. Basically, it is facing three issues:
Soaring construction and housing prices
Slow and unreliable development timetable
Dreadful environmental footprint
Taking a step back, one of the shared features of these issues is the multiplicity of stakeholders and the lack of coordination between them. The very low penetration rate of digital tools, lack of vertical integration and poor upfront coordination are accountable for the lacklustre productivity gains we have witnessed over a century. Nevertheless, it is fastly changing since the last decade. In foreign countries, especially in the USA, where we had the opportunity to work, we noticed a fast modernisation of the sector relying on digitization and industrialization. These innovations are not widely spread yet in the European market.
Moreover, there is a strong economic and contextual opportunity for this market. The construction industry is facing increasing regulatory constraints to cut its environmental footprint (25% of global CO2 emissions). Current design and construction techniques have yet to evolve and cannot generate the significant productivity gains required to compensate for the cost increase (sustainable materials are 15% more expensive). As such, real estate developers are looking for law-abiding, eco-friendly solutions without compromising on quality or profitability.
A fundamental switch in design and construction processes is necessary to limit construction costs and allow to build environmentally friendly and affordable buildings. This allows us to provide an ambitious answer to the housing and environmental crisis. Nicolas Guinebretière, Jean-Christophe Pierron and myself created Vestack to reconcile sustainability and competitiveness, relying on a double innovation: a digital design system and an industrialized pre-assembly of the buildings. Our design software allows our partner architects to focus on tasks with higher added value while our modular construction system enables Vestack to increase its productivity. This allows Vestack to design and build timber frame buildings, assembled off-site in an industrial plant, with 3x lower CO2 emissions, 2x faster, and at no additional cost compared to traditional construction.
There are currently three challenges in Proptech which have an impact on our company.
The first challenge is to better integrate the design and construction phase. The traditional split between these two phases is mostly irrelevant in today’s world. We need to switch to design for manufacturing. The construction phase is an opportunity to integrate game-changing technologies to reduce the carbon footprint, improve comfort or maximize efficiency.
The second issue is linked to a shift from craftsmanship to industrial production. It’s shameful to see so much time and energy wasted on construction projects: workers having to start every project like a new prototype; going back and forth between multiple construction sites ; losing time to resupply; waiting for colleagues to finish their part. We need to streamline the construction process, and develop buildings like we assemble cars. This is the only way to reduce rising construction costs and to absorb the additional expenses necessary to shift to environment-friendly construction materials.
The last step is to think of the construction and building as a service. When design is vertically integrated, construction becomes a turnkey service for developers. This allows them to focus on what they do best: source projects, draw guidelines, and sell them to an end client.
At Vestack, we strive to accelerate the pace at which the construction industry is evolving. We are working hard to seize opportunities to digitize, industrialize and create new business models. We cater to the needs of our clients, real estate developers in multifamily housing, educational buildings, student housing etc. through an innovative service, ranging from the design to the construction phase.
Vestack has invested a lot in R&D over the past years. We have developed our software plug-in to streamline the whole design process around a digital twin of the building which is designed for manufacturing. This BIM model enables us to work on the architectural design, structural analysis, and to extract bills of materials and production instructions.
We have developed our own construction system, which is the right balance between the architectural flexibility and the ability to be produced industrially. We can build modules which are open on the side, with non rectangular shape, in order to tailor them to the specifics of any given project. Their facades and roofing systems are adaptable to the local prescriptions and taste of our clients.
We have witnessed good customer traction since we presented our solution to the market and signed our first contracts. We recently closed a first round of financing, and we have a strong ambition of high growth in the next few months. We will be opening a new production facility mid-2021 to accelerate our commercial development.
Our vision is to quickly and strongly develop our products and partnerships in France and then market our solution throughout Europe. We are planning to raise a second round of financing in 2022. The goal is to become an European leader in sustainable and innovative construction.
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