The team at ALICE Tech knows that the construction segment can be slow to adopt new technology and the tools that many use for project scheduling and management. Excel and Microsoft Project are decades old and are not purpose-built, making ALICE an industry breath of fresh air.
Through AI, ALICE enables customers to create millions of potential schedules at once, and then analyze those options to find the path that best suits their business goals. Companies can reduce risk and save months of production time and millions of dollars in costs.
So yes, the technology is cool, but so is their CEO, René Morkos. In addition to running ALICE, he is a professor at Stanford. He’s also a sharp, funny guy with a plethora of stories to tell, and he’s an engaging interview.
M.R. Rangaswami: Artificial Intelligence has brought big changes to market segments that range from manufacturing to customer service. How can it now help to improve the performance of the construction industry?
René Morkos: Many construction industry decision makers and influencers have been using the same tools and processes and technologies for decades, and thus convincing them to try new things is not always easy. That said, construction is a huge industry — $12.6T annually worldwide — that is chock full of inefficiencies, and it is ripe for tech-powered disruption.
AI is at the heart of some of the most influential changes happening within the sector. For example, several innovators are harnessing AI to help companies track the progress of their projects over time and monitor progress vs. plan. At ALICE Technologies, we’re using AI to help general contractors during the early stages of a project to create extraordinarily efficient construction schedules, as well as to revise those schedules during the building process to avoid costly delays if circumstances change along the way.
M.R.: Why is AI particularly well-suited to infrastructure construction? How can it help the U.S. to make the most of our big new commitment to infrastructure spending?
René: Large infrastructure projects — think bridges, highways, and railways — are extraordinarily complicated. Building them requires a complex synchronization of people and resources, and AI is ideally suited to help general contractors to create an optimal construction plan — and to tune that plan along the way to account for the changes that will inevitably arise during construction. With this country poised to spend more than $1.2 trillion on infrastructure projects, taxpayers deserve to get the most value possible from this enormous investment. By applying AI to these projects, general contractors can build them as efficiently as possible, ensuring that the public gets the most for their money, and that the roads, tunnels, and other infrastructure elements are ready when promised.
M.R.: The construction technology market has seen a recent influx of venture investments. Why now?
René: Venture investors are realizing that not only is the construction market huge, it has also been chronically underserved by technology companies until the last few years. The opportunity to drive significant change in a large industry is alluring, and savvy investors have started to back promising players. According to the market intelligence firm CB Insights, the contech sector received $5.1 billion in funding for startups between 2015 and 2019. And 2020 will be a record-breaking year for the industry, with $1.3 billion in total funding and growth of 56%.
Looking ahead to 2022 and beyond, we believe that the emphasis on improving national infrastructure will further accelerate interest and investment in the contech space. Not only is infrastructure investment heating up in the U.S., but we’re also seeing the same on a global level. In the U.K., for example, where the country is making a substantial investment in infrastructure, that expenditure represents almost 1% of the country’s GDP. In South Korea, that figure is 1.65%. And in China, it’s a stunning 5.57%. In short, this boost in infrastructure spending will serve contech companies well, and investors know it and want to profit from this large-scale, global trend.