Construction SKU Cost Model

A startup that helps construction companies get real-time material pricing data through an API, transforming offline construction cost estimation into a structured digital system.

Core Problem & Market

• Construction cost estimation is highly variable (can vary by millions)
• Material costs are one of the biggest variables in construction
• $1 trillion+ market just for construction materials
• Currently done mostly through pen and paper processes
• Annual printed "blue book" is outdated quickly due to price fluctuations

Product Solution

• Upload construction plans to get accurate real-time cost estimates
• API provides current pricing data for materials
• Helps contractors bid accurately on jobs
• Converts all construction materials into structured SKUs
• Tracks price changes over time
• Allows "what if" scenarios by swapping materials

Technical Innovation

1. Data Structure Creation

   • Converting all construction materials into SKUs
   • Similar to retail product SKUs (different sizes = different SKUs)
   • Building comprehensive database of all possible materials

2. Price Feed System

   • Gathering real-time price data across suppliers
   • Handling vendor-to-vendor price variations
   • Converting unstructured offline data into structured online format

3. API Development

   • Creating queryable interface for price data
   • Enabling real-time price checks by location
   • Providing price change notifications

Business Model & Traction

• Selling directly to builders and cost estimators
• Already achieving 7-figure ARR
• Series A valued at $50M+
• Future potential to add marketplace functionality
  • Add "buy" buttons to estimates
  • Enable direct material purchases
  • Connect suppliers with buyers

Challenges & Risks

• Construction industry is traditional and slow to adopt tech
• Converting offline processes to online is difficult
• High valuation at Series A stage
• Need to maintain accurate, real-time data across many variables