Major builders sub-contracting out works to specialty trades is a vast problem in the construction industry. ProcurePro helps solve those procurement problems.
I spoke to co-founder Alastair Blenkin to learn more about the tech, the journey, and the company’s global growth plans.
Alastair grew up in Brisbane, Australia’s third-largest city, and went to the Grammar School there. When considering what to study at university, Alastair was close to forging a career in medicine but thought it was too conservative for him. His uncle encouraged him to consider commercial law, so he sat for a BA in Law and Commerce at the University of Queensland.
During his time at university, he spent six months at Leeds University in the UK. He later spent six months living in the Greek Islands before starting a Graduate role at the international law firm Minter Ellison. Law was never meant to be a long-term solution, and Alastair developed more interest and obsession with efficiency, achieving better, faster results than the law itself. After three years as a lawyer, he was just about to go traveling again when he had the idea of starting a tech company.
Alastair had developed a habit of writing down ideas for businesses. With one such idea in mind, he saw that the UQ ilab Accelerator applications were closing imminently. Before going to bed that night, Alastair spent an hour doing the application and was invited to attend their Bootcamp for a weekend. He took a Friday off work and was then offered a place to join the accelerator for three months.
At this point, Alastair was planning to offer an AI-powered contract negotiation and management tool for commercial landlords in the real estate and development industry and had called the business Hyra iQ. The problem Alastair had identified was a very real one, with the work involved being hugely inefficient, heavily reliant on people (charging hourly rates), where a software solution seemed ideal. However, lawyers proved less enamored by the idea of anything that separated them from their clients, so changing the legal industry proved challenging.
As real estate and construction are inherently intertwined, Alastair was discussing similar challenges in construction procurement with his long-time school friend, Tim Rogers, who was living overseas. When Tim returned home to Australia at the start of the Covid pandemic in April 2020, ProcurePro was founded. The team was established with Co-Founders Tom Newby, Nathan Dench, and Jesse Dymond, who were able to take those learnings from Hyra iQ and apply them to ProcurePro.
Alastair had seen how complex procurement processes were slowing down construction projects and the immense cost of poor-quality contracts. ProcurePro provides solutions to both problems with digitized solutions for sub-contractor procurement.
Main contractors can compare sub-contractors’ costs, select and approve accordingly. They can then draw up contracts, populate them quickly, compile annexures, and send them over for signature with DocuSign, all on the same platform. ProcurePro integrates with key construction technologies such as Microsoft Office online, project management platforms Procore and Aconex, and financial systems such as Jobpac.
Contactors can then track work they have subcontracted, giving transparency at every stage and ensuring work is kept on time and within budget for everyone involved.
The procurement tech means less time and money in paperwork, fewer errors, better quality, increased efficiency, and profitability. The entire trade procurement system is simplified to ensure site work can start as soon as possible and is then monitored all in the one central workspace.
The construction procurement tech company’s journey
Initially, they were able to launch their construction procurement tech with friends and family funding. Being founded in 2020 meant facing COVID almost immediately and its associated problems. COVID for ProcurePro had both challenges and advantages, but it certainly exacerbated all of the issues within the construction industry, as lockdowns caused significant disruptions to job sites. Sales were challenging, though this was at a time when most efforts were being put into R&D, with Government grants and subsidies helping to cash roll the company.
For someone with a high awareness of time and efficiency, the move to zoom was hugely beneficial for Alastair. Instead of continually flying between Sydney, Melbourne, and Brisbane, zoom meetings mean less cost, most time to sleep.
By October 21, ProcurePro announced a $2.6 m seed round. Alastair says that he had learned so much from his experiences with Hyra iQ, which helped enormously when it came to putting the new product together and achieving that product-market fit with the procurement platform. That fit immediately made fundraising comparatively easy, and everything became easier to move forward. Seed-funding came from several locals within the construction industry, Australian and US entrepreneurs, and investors.
The first time around, Alastair says he was also convinced that he could manage bootstrapped and was under-capitalized for the size of the opportunity at hand. He approaches things very differently now. But he describes the journey as one where he is constantly learning and says that the moment you know how to do something, you have to hire someone else to do it.
What’s next for ProcurePro?
They have proven there’s a market demand for the construction procurement tech, that it solves a real problem, and that customers are willing to pay. They now have big plans and will complete their Series A round before the end of 2022.
Having established that they have the right problem and the right solution, now it is all about scaling. This Series A round is to continue investing in the product and fund their growth, both at home in Australia and in the UK and US. They have already validated both US and UK markets and found that the problems in construction procurement are indeed similar overseas.
They have been thoroughly researching both the US and UK construction procurement markets to ensure that their product is as good a market fit and to find out what tweaks they need to make to ensure it fits locally. Some of those tweaks, for example, lie within language used in procurement. For example, the word “tender” is the same in Australia and the UK, whereas they replace it with “bidding” in the US. The different markets also have some different software integrations they need to fit with. While all these will be minor adjustments, these details matter.
Alastair says that the expansion will also mean a change of continent for him as his base, through which one is as yet undecided. The UK is a more similar market to Australia, given its British colonial history. It, therefore, will have a more immediate product fit, though the US is a much bigger market. He loved his time in Leeds, despite the weather, and still has friends over in the UK.
Long term, ProcurePro aims to become the industry standard software for procurement in the construction industry.
When people ask Alastair for advice, he always tells them to read The Lean Start-Up by Eric Reiss. He then says to connect with him on LinkedIn and let him know what they thought of it. Finally, he tells them to let him have their thoughts within a week. He says if people are serious, they will read a book in a week.
He gets a 10-15% follow-through rate. It’s a litmus test to understand whether someone is wholly committed to an idea or changing their circumstances. If they are, then there is a possibility to develop a relationship further. Most people only need help on something small, a next step. He has kindly permitted me to link to his LinkedIn profile if any reader wants to take him up on this challenge.
If you have enjoyed this, you might enjoy Andrew Barnes’ story of Go1, another huge success story, started in Brisbane and going global.