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COMPANY: Materially
YEAR FOUNDED: 2021
INDUSTRY: Vertical SaaS, Fintech
HQ: NYC
FOUNDER: Ozan Yalniz, Christian Carollo
FEATURE
31 Oct 2023

Setting the Scene

  • Despite living in a digital era, the construction materials industry remains so archaic, it hardly needs Wi-Fi.

  • When materials are purchased:

    • Builders place orders on the phone— bound for miscommunication. 📞

    • Material suppliers manually track sales, orders, and management. 📠

    • Upon delivery, haulers collect easy to loose, physical paper tickets that are critical for billing and tracking fulfillment. 🧾

  • This process leads to poor communication, errors, and plenty of billing disputes.

  • This week’s company offers an end-to-end platform to digitize the construction supply chain, eliminate errors, and push this industry into the 21st century.

In a Sentence

Materially is a construction material management platform that streamlines efficiency and communication between suppliers, buyers, and haulers.

  • Suppliers: Materially’s paying customers utilize the platform to digitize sales, track orders, manage analytics, dispatch, and more.

  • Buyers: Building companies use the app to order materials as well as track dispatch and billing, which limits order disputes.

  • Haulers: Truckers use the digital platform to increase efficiency in drop-offs, leading to higher productivity.

Bulleted Version

  • Materially is like the Shopify for construction materials, digitizing, centralizing, and managing the buyer and supplier experiences. 🛒
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The Basics:

  • Headquarters: NYC
  • Employee Count: 4 FTEs
  • Investors:

    Picus Capital, various angels

  • Funding amount: $2.5M in pre-seed
  • Currently raising: $1.25M bridge round
  • Business model: B2B SaaS, charge suppliers a software fee
  • Early traction: 3 paying customers (suppliers), 35 active builders (buyers), $10M GMV, 60% MoM volume growth, 23k+ truckloads delivered

Due Diligence

WHAT WE LIKE
  • 💥 Disrupting the market: The bulk construction materials industry is massive, yet one of the most overlooked verticals in construction with suppliers, buyers, and 3rd party truckers relying on legacy software, phone calls, and paper tickets.

    • Materially is well positioned to accelerate into the market due to a GTM strategy focusing on one of the largest categories in bulk materials called aggregates.

  • 👩‍💻 Customer acquisition: By onboarding suppliers as clients, Materially is able to acquire the other two sides of the market place with little CAC.

    • Materially looks to focus on mid-sized aggregate producers, tapping into a sector that's large enough for significant revenue potential, yet nimble enough for shorter sales cycles.

  • 📊 Expansion Strategy: Materially's roadmap includes leveraging AI for truck route optimization and expanding into waste management, demonstrating a forward-thinking approach to scaling its platform's capabilities and market reach.

POTENTIAL RISKS
  • ↪️ Learning curve: Materially faces the challenge of educating a traditionally non-digital market, requiring significant time and training.

  • 🤔 Market resistance: The conservatism and existing relationships in the construction industry could hinder rapid adoption.

  • 🏗️ Reliance on the supplier: Since Materially doesn’t monetize as a marketplace, the success of the company hinges on growing the customer base rather than transaction volume.

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Founder Profile

Why Materially

By digitizing the antiquated construction materials supply chain and offering a unified platform, Materially is breaking new ground in how suppliers, buyers, and haulers interact. 🚧

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