Subscribe
Share
Share
Embed
“Slices” on the people and organizations in construction via news, thoughts, podcasts, spotlights and more!
Hey, everyone. Thanks for joining me on the Slice of Construction podcast. I'm your host, Jared Taylor. Joining me today is Robert Salvador, the CEO at DigiBuild. Robert, how are you today?
Speaker 2:Doing good, Jared. Happy to be here. Thanks for having me, and, excited to get into it.
Speaker 1:Let's dive in. Tell the audience about yourself.
Speaker 2:Sure. So I am the cofounder and CEO of DigiBuild. We are an artificial intelligence software in the construction industry. We help big developers and contractors basically get the best pricing on their building materials, you know, save money, do predictive analytics to keep their lead times and material on schedule getting to the job site, and then automate a bunch of other, these paper laden processes that seem to dominate our industry. Before that, I owned a commercial construction company, specialized in a lot of, you know, big commercial hotels, apartments, things like that for the better part of 10 years.
Speaker 2:And before that, I had been a project manager, worked in many different stakeholder positions in the construction industry. My dad had a small drywall company that, contractor that, I worked for when I was growing up. So I always make this terrible joke that all of the modern day, you know, safety coordinator positions are made because of me, the 11 year old who was running around, you know, hanging drywall and mixing buckets of mud. So construction has been a big part of my background for a long time and now building technology in the industry.
Speaker 1:My father's been a a laborer for probably, like, 30 years now. And before that, most of my fam or or bricklayers or building, like, homes. And then I remember my dad's buddy said, you know, if if if you're deciding on college or something else, let me take you to go hang dry, sheet rock with me for for a day and see how you like it. I couldn't make it through half that day. It is the most awkward thing.
Speaker 1:You and you wouldn't think it's heavy. It is so heavy. And all of them end up having, like, a shoulder surgery eventually. Right? Because it's it is such a strain.
Speaker 1:So, yeah, that was that was my intro to it. But, construction's been all me, that's why I wanted to start this show, even though I haven't been directly in the space. It seems like everyone I know is. So, really excited to chat with you here today. Thanks for that intro.
Speaker 1:Let's say you're running into someone on the side of the street. They say, tell me everything about DigiBuild. Give me that overview. What do you tell them?
Speaker 2:Yeah. I mean, so most simply, we help big companies to manage and purchase the building materials that are necessary to build their project. So everything in the built environment that gets installed has to be purchased or procured at some point, you know, from your drywall, like we've mentioned, to, you know, all of your MEP, equipment, to your FF and E, your furniture fixture and equipment, even to things like, you know, porta potties and whatnot on-site. So, you know, the construction industry in many ways is one big supply chain. And so in artificial intelligence, the latest advances in artificial intelligence really allow you to do a lot of the things that are currently done manually, currently done by brute force, currently done by Excel spreadsheets and, you know, overburden project teams.
Speaker 2:Those things can be automated or made much easier using artificial intelligence. So that's one of the things that we do. We'll get involved on hotel projects, on apartments, on casinos, you know, anything that has, you know, a big or complicated supply chain, even mid tier, you know, semi large projects. And so, we moved our company to Miami during COVID. We were originally in Chicago, and came down here, moved everything, you know, things got really well.
Speaker 2:And then also started to get involved in disaster recovery during hurricane Ian a few years ago, obviously, a a really serious, you know, impactful hurricane. We were able to interface with the governor and his office in the state of Florida and, ended up we ended up donating a bunch of recovery materials and building materials and whatnot. And that ended up, you know, kinda creating a relationship where we help the state out. Now, we get involved trying to, you know, save them money on their projects and really deliver those big government projects as on budget and, on schedule as possible. So, yeah, it's been, you know, obviously, construction is an industry that's really trying to make the leap into more of technology based.
Speaker 2:So I think our background in the industry and the fact that, you know, myself and so many of our team members come from the industry has been a big advantage for us.
Speaker 1:What would you say one of the most difficult parts is, though, of trying to innovate in this space? It is a very, you know, it is a space that people are tend to be set in their ways. Right? This is how things have always been done. It's an industry that could like like a lot of industries, it could use some additional innovation.
Speaker 1:How how do you push back those kind of blockers that exist in the this is how we always have done things. I'm assuming it's it's helping to to educate first and foremost, but, you know, how do you address that?
Speaker 2:Yeah. I mean, I think the first thing is, you know, you hit the nail on the head in that this industry has a very specific way of doing things, and and there's a reason for that. You know, it's not easy to succeed in construction. And the companies and the project managers that do succeed, you know, they've put process and processes in place for a reason. So the biggest thing that we say and we try and do is meet the customers where they're at.
Speaker 2:You know, build our workflows, build our tools in a way that meets their workflows. You know, I always make this joke on on LinkedIn and online, and I think, you know, you and some of your audience may have engaged with it before. And that, you know, these project managers aren't looking for a soil testing app. Right? They don't need an application for every single thing they do.
Speaker 2:They're overburdened and under technology, you know, savvy. So what we do is we allow them to receive the benefits of our technology in a way that's very familiar to them. So they can interact with our AI via email. Just send us an email, say, hey. I need better pricing, or I need a substitution for this item that has too long of a lead time.
Speaker 2:And our AI will be able to pick that up by itself and get those results, track down, you know, a better price or track down a substitution or like item, and then email it right back to them. So that construction manager, that PM, is able to receive communications and answers and benefits in the same way they would do right now without having to change their behavior. So I think that's one of the big things is knowing the industry, knowing the people, knowing the decision makers, and building your company and the benefits that your company or your product might give them, you know, be able to give it to them in a palatable way because you're not to your point, you're not gonna get these, you know, 50 year old project managers to log in to a soil testing app to try and, you know, get some soil testing results that they're waiting on, but eventually has to go to the city and to the architect and, you know, it it's a big siloed process. So I think one of the keys is while it's important to build incredible technology and things like artificial intelligence can really, you know, make a big difference in our industry, equally or more important in construction is how you go to market, how you get your tool to the end user in the most simple way possible.
Speaker 2:And, you know, that's what we're able to do at DigiBuild.
Speaker 1:And talk me through the importance of customer feedback. You know, how are you taking that feedback? How serious do you take that feedback? And, you know, how do you decide you get a lot of feedback. Right?
Speaker 1:How do you decide what's, like, okay, that is actually something we should build, or that is something that this person is venting. They want I remember when I was building, I was building a credentialing, for for health care, an app. And we used to have people that are like, I want the application so that, like, your application doesn't connect with every insurance company in the US, so I can apply and then have, and I said, is there an app out there that does that anywhere? Well, no. It, like, you know, people always they they ask for maybe sometimes, above and beyond.
Speaker 1:But I guess to circle back, how do you take that feedback and decide, okay. This is actually really good feedback. Let's implement it.
Speaker 2:Yeah. You know, I I think one of the things is, you know, capturing enough data and then trying to see the patterns in that data to see, you know, okay. What is, like you said, a project manager just kinda telling you there would be nice to haves versus, you know, what pattern can we see in customers who are, you know, paying customers who utilize us a lot in they're saying the same thing, you know, across, like I said, a pattern. So one is just capturing the data to do that. I mean, there's a lot of tools that that allow for that.
Speaker 2:2 is just making sure you find the time to speak to those customers regularly. So one of the things that we do is we have these customer savings metrics that we provide to all of our customers, usually monthly. Just saying, hey. Here's what we did for you this month. You know, here's how many here's, you know, the dollars that we saved you.
Speaker 2:Here's the hours that we saved you. Here's the tasks that we were actually working on. You know, it might just be pulling down some submittals or something. And then when you have those data points to show to the customer, it allows you to really focus your discussion on where you could improve that even more. And, also, it allows you to focus, like, solely focus on key areas that you want to grow with your customer base.
Speaker 2:Otherwise, you know, if you just have kind of these random discussions with customers, it's really easy to get off, you know, off track. Right? To get into features and things that might be great for the future, But, you know, as a business, it's really important to, like, hyper focus. So, you know, I think the customers because construction people are so busy anyways, you know, usually the feedback we get is pretty valuable because it's like pulling teeth to get the feedback. Right?
Speaker 2:They're too busy. No. I don't have a time for a call right now. So when they do actually have the time for a call and tell us these things, usually, it's something that, like, affects them on the day to day and, you know, can can be applied pretty applied pretty quickly. But, generally, if you talk to enough people, you know, pattern match a bit, you can tell what is useful in your product short term versus what might be a longer thing that customers want.
Speaker 1:And I know you mentioned that you you see a lot of different projects come through. Right? What type of projects have you been seeing the most of? Let let's say let's say this year. Because this kind of this kind of showcase a signal of kind of where the industry is, right, for a snapshot.
Speaker 1:So what type of projects have you been seeing this year more than others?
Speaker 2:Sure. So, I mean, I think you've seen a little bit of an up we've seen a little bit of an uptick in hotels and hotel development because a lot of those struggled during COVID. And so they got all this funding together, and there was a lot of hotels that were planned to be built. And many of them got paused last year, obviously, when there is the super fast rise in interest rates. So we've seen a decent amount of those I feel like start to get going this year just because I think the tailwind of COVID and because I think hotels are kinda making a comeback.
Speaker 2:You know, I think you're seeing the scales balance kinda with Airbnb type companies a bit. So we see a good amount of hotels. Government work, obviously, is still very busy. You've seen a bunch of spending bills that have injected a good amount of, you know, money into those markets to where, like, a lot of government projects are going. Manufacturing, again, you saw the infrastructure bill and you're seeing kinda top down money, attempting to, you know, reshore a lot of this manufacturing.
Speaker 2:So I think those medical, obviously, like, you know, after COVID, there's just this tailwind of of the importance of medical and medical, infrastructure and things like that. And then on the on the other side of that, I think, because of interest rates, you know, the whole market is a bit slow, either delayed or slow. You see a lot a decent amount of projects canceled or pushed back. You know, multifamily was a little bit overbuilt, so I think you've seen that slow down a bit. And then I think in certain big cities, you're seeing a bit of a slowdown.
Speaker 2:So yeah. But, I mean, overall, I think the market has relatively I mean, it it's struggled, but I I think because there's so much spending money that came in, the market stayed somewhat active. Hopefully, as you've seen the Fed start to signal that they might lower rates later this year, You know, once that happens, hopefully, you see some of these projects get get kicked back into gear. But yeah. So, I mean, it's still obviously, it's, you know, a big market in the US.
Speaker 2:So there's always gonna be some work, but definitely slower lately.
Speaker 1:Well, it's like, so I'm in Saint Pete, Florida. So, yeah, total total other side of of you. And we have a project nearby, a residential project where my apartment complex, they wanted to buy they so they ended up buying the lot next to us and with the expectations they were gonna build on it. And this was kind of before the the pandemic. And the cost got so out of hand.
Speaker 1:They planted some trees. They put a fence around it, and they said, we'll take a look at it in a couple of years from now to see if we wanna because if there are some projects, right, that you just can't even make financial sense of doing even if you wanna do them. And, I think that's kinda where we're at is that's gone into the decision making maybe more than in prior years where it was like, the cost is there. Let's just go and build this thing. Right?
Speaker 1:It's too much of a risk now.
Speaker 2:Yeah. And I think you kinda got, you know, back to back punches, so to speak. You know, you already had supply chain disruptions because of COVID. Right? So that, you know, made everything more expensive, made everything harder to get.
Speaker 2:You know, global supply chains are very much still in a moment of reset, you know, after COVID tried to move away from just, like, solely Asia, trying to reshore things and whatnot. So that was already driving both lead time and price issues. And then, yeah, you see the, you know, super fast hike in interest rates. So when you add those two things together, I know a developer who had a big property similar to what you're saying, multifamily pad up in I think it was Fort Lauderdale or maybe somewhere up there. And they're a big company, you know, a a very large developer, and they basically said, yep.
Speaker 2:We'll come back to this in a few years. We're just gonna sit on it for now. And, you know, unfortunately, construction does have longer tailwinds. You know, we saw that in 2008. It did take a couple years to clear clear everything out.
Speaker 2:But, so, yeah, we see that a lot. But, again, I think because the Internet has penetrated so much more of the world now than in 2008, there is so much bigger and broader access to capital than there ever was. Like, I I was just down in in South Florida and, one of the big, hotels and resorts I love to work at that's isn't far from me is the Saint Regis in Bell Harbor. And, I'm told that they have a new owner, I guess. And I it's the country of Qatar, like, the sovereign wealth fund or something like that.
Speaker 2:Right? And it just kinda goes to show how far and how much access there is to capital nowadays. And so I think because of that, you may not see as long as a prolonged downturn in construction even though we have a a little bit of a downturn right now. Hopefully, we come out of it faster, you know, maybe later this year.
Speaker 1:Speaking of, like, construction projects, if you haven't been on that site, check out the the NEOM project in Saudi Arabia with the. It is unbelievable what they're building over there. And to your point, right, with, like, the sovereign wealth fund and the amount of money, because because money is no object. Right? They'll just in their case, it might not have to make as much financial sense.
Speaker 1:They'll do it, and they're gonna they'll probably still end up making a return off of it. Right? It's just it's a different ballgame, over there. But but yeah. Yeah.
Speaker 2:I mean, so we're expanding into Saudi Arabia right now. We're doing a $1,000,000,000 mall project out there, which first of all, as you as you allude to, like, who else is doing a $1,000,000,000 mall of anything right now. Right? Like, no one's building malls that are that big. And so, just seeing what's happening with the capital from the top down to your point, you know, where a real estate project might have to hit its numbers right away in the first couple years out here in the US.
Speaker 2:Where in Saudi Arabia where it's coming from the sovereign wealth fund, they don't care if they don't make money for the next 10 years. They'll eventually make money on it. So, they are really pushing some big projects, you know, to your point in those situations. Yep.
Speaker 1:Yeah. And it's they're they have the luxury of being longer term thinkers than a lot of the developers over here can. Right? And that's not a knock on the it's just it's a it is so much more money. It's it's incredible.
Speaker 2:Yeah. I mean, I wrote about this on LinkedIn before. You know? Obviously, I would never push, like, a top down government. But in the construction industry, it's a really interesting case study because in the US, we have these free markets.
Speaker 2:Right? There's a 1,000,000 different ways where projects come together. There's different, you know, partner types, LVs, blah blah blah. That's good, but that makes it really hard to standardize or force anything, which is one of the big reasons because, you know, construction technology takes a while. On the flip side of that, you have places like Saudi Arabia where they could just jam it from the top down, and they could say, you're going to build this.
Speaker 2:Here's the money. You're going to use technology because we say so. And so it is you know, again, I would never push for this in the United States. You don't wanna top down government, but it is interesting how the construction markets react because of the ability from the top down to just push these initiatives and build some whatnot.
Speaker 1:100%. Yeah. It's it's super interesting. It it'll be interesting to see how it continues to play out over here and and what we do. Because I also see them investing, like, from over there and a lot of a lot more projects over here.
Speaker 1:Right? Because it's the same thing with the longer term thinking. They they have that luxury. It it's been interesting, though. You know, when we looked at before the pandemic, all these, these buildings were going up pretty quickly, and then we had that that supply chain issue where it went a bit slower, and you you weren't having people necessarily working 7 days a week to to finish jobs up fast on multiple shifts.
Speaker 1:Right? And I've seen such a change in in Saint like, Saint Petersburg over the last couple years, like, a suffix building, this massive building over here, which I think is gonna be the high like, the tallest building on, like, the West Coast of Florida. And, the speed at which they're going is just it's it's like a floor it's like a floor every few days. It it's wild. It's we've really we've really sped up the process.
Speaker 1:And, like, maintaining safety, still going fast, like, what do you think the I guess this is what I'm alluding to. What do you think the future of construction looks like if we're continuously streamlining? Like, you're doing your part to streamline the whole process. There's equipment that's helping to to, you know, fabricate the different parts of the building more quickly. What are your thoughts on the future of construction and where we're heading?
Speaker 2:Yeah. I mean, I definitely think you're going to see a lot more tech introduced. I do think it'll be market based, though. Kinda to your point, You know, there's some markets that will just fight technology for a lot of different reasons. Right?
Speaker 2:That could be the incumbents, that could be policy. You know, here in Florida, they're the the governor and the state is they actually just had a big press conference where they had a big sign that said, was it on time and under budget or on time on budget? And they were talking about these new construction projects, like, there's a big highway project here in Florida and expansion. And the expectation from the state is that, you know, they they get these done, you know, on time and save money. So the state is now starting to try and provide, you know, coverage on technology and and support it.
Speaker 2:So I think policy definitely matters. I think you will you'll see more and more construction technology be integrated. I do think just because I do think there's a little bit of a bubble in construction technology. Listen, there's going to be a ton of tech and there already is that's that's penetrating and succeeding and and helping the industry. But I think because construction is such a big market that has been typically, under you know, didn't have enough technology usage, you're seeing a lot of, like, venture capitalists and a lot of firms that, like, don't really know construction kind of try to come in and just fund anything.
Speaker 2:So I do think there'll be a little bit of a balance. Like, all these some of you know, many of these won't succeed. You're seeing this in PropTech now. Like, you know, it's not easy to deal with the sales cycle in the market, but I do think that we have a future of you're gonna see a lot more modular building in my opinion, like off-site construction of some sort. I think you'll get eventually some, like, robotics, you know, you see the brick laying robot, you see a a a drywall finishing robot now, you see autonomous, you know, equipment and things like that.
Speaker 2:I think those things will happen. Again, AI kind of things like we do that are easy to introduce to project teams where they just click a button and they say, wow. You saved me money or you made sure my my materials here on time. So I think you'll see technology like that over the next 10 years really start to penetrate, but, you know, I definitely still think, you know, there's no day where, like, robots are doing all of the work and there's no human on the job site. Like, there's just too many small data points to put together to ever, like, fully maybe not ever, but, like, anytime in the near future fully automate this industry.
Speaker 2:So, you know, one of the things I got asked on a a big program one time was, you know, do you worry about artificial intelligence, you know, taking people's jobs? And I go, no. We use AI to empower, not replace. We are very far away from, you know, an industry that's being replaced, and we're an industry that needs help. So I think over the next few years, you're gonna see more and more technology introduced and succeeding on projects.
Speaker 1:That phrase is so true. Like, it's so true. If you went up to people on the street, there's 2 types of people with how they react to AI. There's the people that think you can automate everything with AI. They're not right.
Speaker 1:And there's the people that are dead set against it saying it's going to take all these jobs. It's going will it get rid of some jobs? Sure. Was there a case to be made that those jobs were probably going to be gone in the future anyways even if we didn't have AI? Yes.
Speaker 1:Like, we're I always tell people, we're not gonna stop innovating. Like, that's human nature is to keep innovating on a process. But, yeah, people don't real some people don't realize that, like, everyone should be learning how to leverage AI in some way because those are the people that won't have jobs in the future. If you have no knowledge of it or you refuse to, you know, learn about it yeah. But it's it's meant to empower.
Speaker 1:You're a 100% right. Can someone do their job, with less stress or effectively, you know, faster? Like, it it changes the game for sure.
Speaker 2:Yeah. And and that's a good point. Like, the way you even present it, like, as a narrative. Right? Instead Instead of just helping you to save money, can you do your job with less stress?
Speaker 2:You know, as you probably are aware, construction has the 2nd highest suicide rate in the country of any industry. So things like AI helping you to succeed more, to be less stressed, to be less overwhelmed, you know, there's gonna be a lot of ancillary benefits that, like, unfortunately, people in this doomerism or, like you said, kind of the polarity of every issue that happens nowadays, you know, may overlook. But, no, I'm excited for the industry. I think more and more people, like, are already waking up to the potential of it and to the need for it. And so I think, you know, people like us, like yourself and and us, if we continue to push this, we'll we'll get where we need to be.
Speaker 1:I love it. Well, Robert, thanks so much for joining me on the podcast here today, and look forward to continuing the conversation.
Speaker 2:Yeah. Jared, thank you for what you're doing for pushing these messages of technology and progress and everything like that. I really respect it, and I think we're doing doing God's work in construction, if you will.
Speaker 1:I love it. Thanks so much.
Speaker 2:Thanks for having me.