Meet Adam Zobler, General Partner at Global Venture Fund: Foundamental

Foundamental is the only venture fund, that is global, investing in construction tech.

This comprises all technologies that aim to help automate and augment the myriad of processes in the built environment, empower field workers and small businesses to be more productive and work more safely + all technologies that make construction cleaner and more sustainable.

We aim to find and partner with the bold and bright who strive to make the built-world autonomous and clean through technology and science. It’s about time we rewire its archaic, analogue workflow steps to make it fit for purpose for the digital era.

We started investing at the end of 2019 and have, to date, 61 companies in our portfolio, representing $5.4bn in aggregate valuation; one firm generating $1bn+ in revenue, having become the fastest company to reach unicorn status in India, and six other companies with $100mn+ in run rate.

We aim to be the first institutional investor in the companies we partner with, and our firms have raised in excess of $1bn, which is double that of our closest sector focused peers who have been deploying capital for twice as long as we have.

We are lucky to have worked with top founders from across the globe, and it has just validated our excitement for this space.
 
 

 

How did you come up with the idea for the firm?

 
There are two main North Stars that helped us initially to chart and navigate the direction that we chose for Foundamental.

In an era of change, construction has been left at the altar by the efficient frontier. Construction is the biggest, undisrupted market in the world – an 11 trillion-dollar market (10% of the world’s GDP), which employs 1 in 14 workers globally. Yet the construction industry is massively inefficient and getting worse. We have recently seen a severe productivity decline of -23% from 1990, whereas manufacturing and agriculture grew 240% and 290% respectively during the same period.

In 2019, the “why now” that helped navigate our decision was that the construction industry was starting to go through a teething phase of a much-needed evolutionary growth spurt. At the time of formation, we were – and remain today – fervent believers that the industry will become an orchestrated economy. This added to our belief that construction was during a Renaissance funding cycle. In terms of venture funding and supporting innovative founders, by observing other sectors and their patterns, we noticed that it generally takes sectors ~five years to scale from $5bn (in venture funding) to $50bn.

As such, by the end of 2018, the construction industry achieved $5bn in funding…we are now at $20bn year to date. It’s therefore likely that we will see three times this in the next two to three years.
 

How has Foundamental evolved over the last couple of years?

 
Global benchmarking and early trend recognition – our verticalized model has given us pattern recognition on a global scale. Over the past years, we believe this has given us a severe advantage over our sector-focused peers.
We have become increasingly more agile at identifying companies with the greatest potential for scale, whilst also alleviating the most prevalent deep tissue pain points that the construction industry is suffering from on a daily basis.

For example, through our investment in Infra.Market, a material marketplace and one of the fastest growing tech companies in India, we gleaned the salient variables/ingredients necessary to produce a successful material marketplace within the built-world. It enabled us to develop and refine our thesis and ultimately hunt other regions that would be fertile ground for growth to support fast adoption and outsized growth, which led us to TuL, a now Latin American category leader.
 

What can we hope to see from the firm in the future?

 
As mentioned, the pain-points are real, costly, and painful. We’re at the S-Curve of innovation and adoption, the market is inflecting due to pull-in demand by industry stakeholders for solutions that will buoy productivity and efficiency.

Over the last ~six months, whilst others are on the back foot, finding refuge on the sideline, we are increasing velocity and electing to double-down on our thesis and our model, and the exceptional “maverick” founders innovating within the built-world industry.