- The COVID-19 pandemic has highlighted three common demands from the start-up tech community: peer-to-peer support, access to funding, and knowledge about banking services available to the start-up community
- Rather than looking for start-ups that package their solutions for COVID-19, the big players in the construction industry are innovators who are versatile, and offer sustainable business solutions
- When it comes to surviving and thriving in an environment such as the COVID-19 pandemic, start-ups need to have identified an adequate market need for their solution or the correct product fit
What start-ups and corporates want?
The COVID-19 pandemic has highlighted three common demands from the start-up technology community, which includes the construction start-up community. The first is the need for peer-to-peer support during uncertain times. The second is the desire from both founders and corporate employees, who were feeling insecure about their job situation or job prospects, to improve their knowledge about the business canvas and to know more about the funding landscape. Thirdly, many start-ups and entrepreneurs are showing an interest in knowing more about banking services during COVID-19.
What has also become evident over the last three months is that many start-ups are now trying to package their solutions for COVID-19. However, large corporates in the construction industry are not looking for start-ups that only offer solutions that are valid during COVID-19. Instead, they are looking for versatile innovators that offer sustainable business solutions that compliment diversified business operations in the long run, irrespective of COVID-19.
Rethinking your ideas in order to survive
Many start-ups have been severely affected by COVID-19 for reasons such as not being able to find the correct ground to export their products, for example. However, many of these companies have had the privilege of having the time to rethink whether they can survive a further pandemic or crisis by reiterating and considering all of the options that they might have in front of them.
The reality is that up to 40% of start-ups are doomed to fail within the first four years of their existence, and 25% of those cases are related to the fact that there is no market need for their solution or a lack of product fit. When it comes to surviving and thriving in an environment such as the COVID-19 pandemic, this situation has undoubtedly played a role in eliminating some of those companies that position themselves as the “next innovator”, using trending words to explain their solutions, rather than providing a solution or a service that is of real value to the industry.
The pandemic has also shown that there is a need to rethink the way we live and work. For example, we should consider whether construction should be moving away from building apartments in high-rise buildings to building standalone units in rural areas that are self-sufficient and sustainable in terms of growing food and creating energy. Start-ups that can capitalise on this type of mindset and maintain agility in these types of situations are the ones that will play a part in moving the industry forward.
The role of start-ups in the construction market of the future
In the mid-to-long term, there is a positive outlook for the construction market in the Middle East. Firstly, because of the construction opportunities in oil and gas, and secondly, because of the demographic growth in the region which requires considerable infrastructure and housing. There will also be an important mindset shift within the construction industry when it comes to the use of technology in the post-COVID-19 landscape.
The start-up community has a huge opportunity to innovate and play an influential role in shaping the technological mega trends in the infrastructure industry. These include critical areas of focus such as the rise of new material and substances; the increase in green energy sources; the growth of smart infrastructure and Internet of Things (IoT) sensors; autonomous driving and new transport modes; as well as digitisation such as BIM or contact tracking.
We are also in an era of significant change that is moving towards sustainability and smart construction - for example, the use of new construction materials that comes from waste. While there may be a lot less profit out there for start-ups, this is an opportunity for them to think clearly about what they really want to develop and to check whether our ecosystem is giving them any kind of opportunity to realise this in a smart way.
As a result of COVID-19, the construction industry is experiencing the positive outcomes of cross-industry convergence and, as a result, we are seeing more and more non-construction and non-Proptech start-ups emerge to serving the industry with new solutions and technologies. Dubai, in particular, is very well positioned to deal with digitalisation across all sectors, and this should be viewed on a positive note, not only in the construction industry but also for Dubai as a whole ecosystem.
During uncertain times, the role of peer-to-peer support for start-ups has proved to be invaluable. Not only are issues such as access to funding, training and banking brought to the forefront in times of crisis, but the sense of belonging to a community where founders and entrepreneurs can count on the community to offer support and solutions is critical for start-ups to survive through situations such as COVID-19. For start-ups to thrive and play an influential role in a post-COVID-19 environment, they need to be able to capitalise on the construction technology megatrends by thinking smart, thinking sustainable and providing solutions that can collaboratively be used across industries, rather than in isolation.