Investment in technology within the built world is poised for a significant leap, with projections indicating a potential reach of US$24 billion globally in 2024. This surge, as highlighted in the latest State of Built World Tech report by noa, underscores a pivotal moment for the construction and infrastructure sectors. The report reveals that while many industries grapple with a downturn in venture capital, the built world tech sector has managed to soften the blow, experiencing only a 7% decline. This is particularly noteworthy against the backdrop of fintech and broader climate tech, which saw declines of 18% and 23%, respectively.
One of the standout trends from the report is the remarkable growth in industrial automation, which skyrocketed by 61%. This is largely fueled by a staggering 895% increase in building operations robotics. It’s clear that the built world is embracing automation, and the implications are profound. As we face labor shortages and a growing demand for efficiency, robotics in building operations may not just be a luxury but a necessity. The advances in AI have slashed costs and accelerated the time it takes to bring robotics to market, making it economically viable for construction companies to adopt these technologies.
Electrification also stands out as a key area of investment, with total funding up by 10%. This increase is driven by a 40% spike in venture funding for grid technologies, underscoring the urgency of addressing grid congestion amid soaring global electricity demands, which are expected to double by 2050. However, it’s not all smooth sailing; funding for building electrification hardware and installation has dipped by 30%. This decline can be attributed to the European energy crisis and the failure of regional electricity market reforms in 2023 to materialize as anticipated.
The report emphasizes the essential role of technologies like grid electrification, labor upskilling, and robotics in reshaping industries and achieving decarbonization goals. Gregory Dewerpe, founder at noa, aptly noted, “Built world tech is at the forefront of our fight against climate change, and the sector has continued to attract investment, even in a challenging funding environment.” His words resonate deeply as they capture the dual challenge of modernizing infrastructure while also combating climate change.
The implications of these investment trends are far-reaching. As the built world continues to innovate, we can expect a ripple effect across related sectors. Increased automation could lead to more efficient construction processes, reducing waste and improving project timelines. Meanwhile, advancements in electrification and grid technologies could pave the way for smarter, more resilient infrastructure that can adapt to the demands of a changing climate.
In essence, the built world tech sector is not just weathering the storm of a global funding downturn; it’s positioning itself as a leader in the fight against climate change. As we look to the future, the integration of advanced technologies will be crucial in creating a sustainable built environment that meets the needs of both people and the planet. The stakes are high, and the time for action is now.