A few years ago, Montréal-based construction technology startup Billdr pivoted after facing what co-founder and CEO Bertrand Nembot described as a “near-death experience.”
“We didn’t get the business model right the first time with the marketplace,” Nembot told BetaKit in an interview last week. “We decided we’re going to continue, and we’re going to find a way to win. And I think that’s what we’ve done.”
“We decided we’re going to continue, and we’re going to find a way to win.”
Bertrand Nembot,
Billdr
Today, the rebuilt and relaunched company announced that it has closed $3.2 million USD ($4.4 million CAD) in seed funding to accelerate the growth of its vertical software-as-a-service (SaaS) offering for small and medium-sized general contractors (GCs) who renovate and build houses and commercial facilities. The company hopes to use the funding to deliver on its plan to become “the operating system” for construction.
Billdr’s all-equity, all-primary seed round, which closed this month, was led by White Star Capital with support from fellow new investor Desjardins Capital, as well as existing backers One Way Ventures, asterX, and Formentera Capital. This brings Billdr’s total funding to approximately $10.5 million USD. Nembot declined to share Billdr’s latest valuation, but claimed it was flat relative to its initial $3.2-million USD seed round in 2021, describing it as “a reset of the company.”
Founded in 2020, Billdr got its start building a managed home renovation marketplace that matched homeowner customers with pre-vetted GCs, handling everything from design and architectural plans to quotes and project management.
Through its marketplace, Billdr was ultimately able to help over 1,000 homeowners across Montréal, Toronto, and Chicago with their home renovations, facilitating more than $100 million in total spending through its platform.
But Nembot said cracks in Billdr’s foundation began to emerge as the startup grew and started facilitating 100 projects simultaneously, from operational challenges to a wave of abrupt interest rate hikes that began in 2022 and led many homeowners to put their renovation plans on hold. That year, Billdr closed a previously unannounced $4.2-million USD bridge round to buy itself some more time.
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But with the company’s runway drying up, a dire economic outlook, and a business model that would be tough to scale, Nembot said that in 2023, Billdr’s leadership had to decide whether to shut down or “fight it through” and pursue a new direction.
Billdr ultimately decided to do the latter, reducing its team to 10 employees and rebuilding from scratch as a vertical SaaS company. It took Billdr about 18 months to build and launch its initial software offering out of beta. Fast forward another 18 months and Billdr’s expanded product has grown to serve hundreds of GCs across Canada and the US.
During this time, Billdr has hit seven figures in annual recurring revenue, processed more than $10 million in payments volume, and achieved “real product-market fit” with what Nembot believes is a much more sustainable and scalable approach.
Nembot said Billdr’s pivot stemmed from the realization that many homeowner complaints about the home renovation process could be addressed by building better software for contractors, who had already been asking the company to provide the tools it offered through its online marketplace independently to help them run their businesses more efficiently.
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While solutions like Jobber and ServiceTitan exist for trades workers and Procore is available to enterprise GCs, Nembot argued that small- and medium-sized GCs today are underserved by the market, which consists largely of legacy providers and products that solve individual problems. The CEO claimed that most of GCs in this group are still using Microsoft Excel because existing offerings are too complicated, or piecing together a complex network of point solutions.
“They want an all-in-one software that’s modern [and] intuitive,” Nembot said.
Now Billdr is building an offering designed to help GCs save time and money managing customer relationships, estimates, invoicing, project and team management, and payments. With its seed funding, the company plans to execute on its AI strategy, begin developing more financial infrastructure (such as bill pay, corporate cards, lending, and insurance), and start helping its clients access real-time building material pricing.
Nembot said he is “most proud” of the resilience that Billdr’s team showed during this pivot. Given what the startup has learned over the past few years, Nembot said Billdr is building version 2.0 of its business in a “more capital-conscious” way. He forecast that the now 20-person company will become profitable within the next few months.
Feature image courtesy Billdr.