The Future of the Field: PlanGrid's CEO talks turning construction high-tech
Tracy Young, 31, CEO and co-founder, PlanGrid, San Francisco
Construction had a paper problem, and Tracy Young had a high-tech solution. Young, 31, co-founded PlanGrid in 2011 after seeing the inefficiencies around using paper plans for big projects while working in the field as a construction engineer.
Young, who now serves as the company's CEO, and her four co-founders devised a way to put that information in the cloud, keeping track of all the details required to complete a construction project while meeting a team's need to collaborate on the go and reducing the volume of paper waste a big project can amass.
Today, the mobile construction platform boasts tens of thousands of contractors, owners and architects among its users. The PlanGrid team has grown to around 250 people, and it has garnered $62 million in funding from groups including Sequoia Capital, Tenaya Capital, Northgate, Founders Fund, Box, GV (formerly Google Ventures) and Spectrum 28.
We talked with Young about the challenge of launching a construction tech business, what the tablet meant for the industry and what’s next for PlanGrid.
This interview has been edited and condensed.
What was the inspiration for launching PlanGrid?
YOUNG: We were in the right place at the right time. The cloud was becoming more popular, stack software was taking over the enterprise, and then Steve Jobs announces the first-generation iPad. These three things together made PlanGrid possible, and so we quit our jobs to build it.
Did everyone else on the team know as much about construction as you did?
YOUNG: PlanGrid was founded by two construction engineers, me being one of them, and three software engineers. We were two domain experts who were super lucky to have three incredibly talented hacker friends.
It’s funny how different talents can marry together.
YOUNG: When we saw the first-generation iPad, we knew we wanted to use it for the field. It was really the first time you could take a fully powered computer that's lightweight enough and with battery life that lasts long enough out to the job site. And so we tried to load blueprints onto that device and a box comes up and says "out of memory." We looked at each other and were like, well someone knows how to solve this, and so we went through this period of what my co-founder Ryan [Sutton-Gee], the other construction engineer, called the saddest story in Silicon Valley: Two domain experts with a pretty good idea and no technical co-founders to build it. We eventually convinced our friends that there was a market for this and it was a worthy problem for them to solve with us.
How did you pitch it to potential customers?
YOUNG: We went back to the people we used to build with and said, "I would like to build this thing for you, do you want to try it?" Our old colleagues were our first 40 users.
What were the responses like early on?
YOUNG: It was just like, "Of course, this is obvious," and I think that's still the response today. It's a very simple problem that we're solving. We're taking all the construction information, which is incredibly fragmented on foremen’s clipboards, the office and the truck, and we put it on our platform. To give you an idea of how bad the paper problem is, on a hospital project I worked on [as a construction engineer] we started off with something like 3,000 sheets of blueprints, and over the course of three years we were at 15,000 sheets — and that's just the blueprints. There’s a lot of information required for projects to be built.
Construction has a reputation for being slow to adopt new technology. What impact has that had on your business?
YOUNG: When we look at all industries and sectors, by and large, everyone has figured out how to use software and computing power to be more effective. When you look at construction, we're spending less than 1% of revenues on software while our counterparts in aerospace and manufacturing are spending closer to 3.5% to 4.5%. Over the last 20 years, everyone else has figured out how to be twice as productive while construction has not only flatlined but declined.
Why do you think that is?
YOUNG: The hardware just didn't exist. Most people who work in construction work on a job site. Only about 5% of people in construction work in the back office. Well, all the enterprise software servicing the space was desktop Windows-based, and so it was only written for that 5%. When Apple announced the iPad, it was really the first time anyone could write software for construction field workers.
Initially, what was the environment like for funding construction tech?
YOUNG: Early on, no one bought. They would say things like: "There's no way construction field workers would ever use software, they don't need it. There's no way they're going to be able to hold an iPad and not break it." These people are constructing in some of the most extreme conditions and are using incredibly dangerous tools, and they know how to go home safe every night. They're going to be able to hold onto an iPad and not drop it. We got a lot of nos early on, a lot of skeptics, a lot of doubters, and we so believed that it would completely revolutionize the construction industry that we just kept working. We just worked with people who supported us.
Who were some of those people?
YOUNG: The first people who believed in what we were doing was Y Combinator. They said they didn’t really understand construction, but it looked like mobile was going to be the future of construction and that we were the right team to solve it. We were able to raise a small seed round after Y Combinator and its "demo day" [in 2012].
Part of the initiation at PlanGrid is a construction boot camp. What does that entail?
YOUNG: We’ve compressed everything you need to know to be a project engineer into one week and everyone goes into that training. It’s really cool. The team comes out of it able to walk onto a job site and have a productive conversation about what problems they’re experiencing and how PlanGrid can help.
What are some of the topics covered?
YOUNG: Lots of construction 101: the people involved in building, the regulations and the contracts around it. My favorite part of training is having the teams look at blueprints and then [add] in a change order. Version control just doesn't work and so the whole time, our developers especially just cannot believe it. Their minds are blown at what status quo is. The paper training portion of the old way — what we are physically replacing with PlanGrid — is incredibly valuable for our team members.
How do you describe PlanGrid to others in the Silicon Valley tech community, given that most of them are not construction-specific?
YOUNG: If it's tech hackers or coders we usually say we're GitHub for construction. If they're Googlers, we say we're Google Docs for construction. There are lots of different ways we explain PlanGrid to non-construction people, it just depends on the profile.
What about in the construction industry?
YOUNG: The way I explain it is we put all your documents in our platform and then you hit publish and it appears on everyone's mobile devices in the field, and you can all go in and edit a document. It’s the software that your foremen will actually use.
What's next for PlanGrid?
YOUNG: PlanGrid has made a huge impact in helping increase productivity and collaboration in the field. But there are still a lot of challenges that we can help solve with technology and good software. It’s a privilege to be able to build great tools for the hardest-working builders in the world, and we want to keep doing this for a very long time.
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