Introduction to Construct Capital
An overview of Construct Capital, highlighting its founding, mission, vision, core values, and growth in the venture capital industry.
Construct Capital, founded in 2020 by Dayna Grayson and Rachel Holt, is a venture capital firm based in Washington, D.C. The firm is dedicated to backing entrepreneurs who are building technology to transform foundational industries, which are critical to the U.S. economy.
Construct Capital's mission is to address the decades of underinvestment in sectors such as manufacturing, logistics, transportation, and energy. The firm aims to invigorate these industries with modern tools and entrepreneurial energy, recognizing their vital role in powering a significant portion of the country's GDP.
With a vision to create broader economic resilience, Construct Capital focuses on leveraging cutting-edge technologies like AI and robotics to modernize these sectors. This approach not only seeks financial returns but also aims to lay the groundwork for a new era of economic resilience.
Construct Capital manages $750 million in assets and has made 42 investments since its founding.
Core Values
Construct Capital's core values revolve around innovation, dedication, and impact. The firm believes in concentrated investment strategies, supporting startups that utilize advanced technologies to drive change in foundational industries.
History and Growth
Since its inception in 2020, Construct Capital has grown significantly, managing three core funds and expanding its influence in the venture capital landscape. The firm's focused strategy and commitment to foundational industries have positioned it as a key player in early-stage investments.
Investment Thesis and Strategic Focus
Construct Capital focuses on early-stage technology companies modernizing foundational industries through advanced technologies.
Construct Capital's investment thesis centers on transforming foundational industries by backing early-stage technology companies. These sectors, including manufacturing, logistics, transportation, defense, and energy, have historically been overlooked by venture capitalists in favor of software and digitally native markets.
The image below highlights a significant moment in history where strategic decisions played a crucial role in shaping outcomes.
Construct Capital's strategic focus is unique in its dedication to foundational industries, differentiating itself through a concentrated portfolio and high-engagement support model. This approach allows the firm to provide tailored assistance and deep partnerships with startups, essential for navigating the unique challenges in these sectors.
- Focus on early-stage technology companies
- Prioritize sectors like manufacturing, logistics, transportation, defense, and energy
- Utilize advanced technologies such as AI, robotics, and automation
Construct Capital's investment in foundational industries represents a once-in-a-generation opportunity as recent technological advances are applied to these sectors.
Sector and Technology Focus
Construct Capital targets foundational industries that are critical to the economy and have been underinvested in terms of technology. The firm supports early-stage technology companies that apply software, automation, AI, and connected hardware to modernize these sectors.
Strategic Differentiation
Construct Capital distinguishes itself from other venture capital firms by intentionally limiting its fund size and focusing on a concentrated portfolio. This allows for high-engagement, full-cycle support to founders, contrasting with micro-VC and large multi-stage funds.
Evolution of Investment Thesis
Over time, Construct Capital has refined its investment thesis to better align with emerging technological trends and market opportunities. The firm's commitment to foundational industries has remained steadfast, but it continuously adapts its strategies to leverage new advancements in AI, robotics, and automation.
Portfolio Composition and Sector Expertise
An analysis of Construct Capital's diverse portfolio and sector expertise, focusing on early-stage investments in foundational industries.
Construct Capital's portfolio highlights a strategic focus on early-stage technology startups across a range of foundational industries. These sectors include manufacturing, logistics, supply chain, food, defense, and transportation, with a strong emphasis on companies leveraging AI, robotics, automation, and advanced software to drive transformation.
The image below illustrates a significant example of industry disruption, aligning with Construct Capital's investment thesis.
Construct Capital leverages its sector expertise to support its portfolio companies, exemplified by successful investments in companies like Chef Robotics and Veho. These firms have made significant impacts in their respective fields, demonstrating the effectiveness of Construct Capital's strategic guidance and industry knowledge.
Diversity of Sectors and Stage of Investment
| Sector | Number of Companies | Investment Stage |
|---|---|---|
| Manufacturing | 6 | Seed, Series A |
| Logistics | 8 | Seed, Series A |
| Supply Chain | 5 | Seed, Series A |
| Food | 4 | Seed, Series A |
| Defense | 3 | Seed, Series A |
| Transportation | 5 | Seed, Series A |
| AI & Robotics | 9 | Seed, Series A |
| Advanced Software | 7 | Seed, Series A |
Diversity of Sectors
Construct Capital's diverse portfolio encompasses a broad array of sectors, with a particular focus on foundational industries. The firm's investments target areas where technology can significantly enhance efficiency and innovation.
Stage of Investment
The majority of Construct Capital's investments are concentrated in the early stages, particularly Seed and Series A rounds. This focus allows the firm to support startups from their inception, providing crucial resources and guidance to scale effectively.
Sector Expertise
Construct Capital's sector expertise is a key asset, enabling it to provide valuable support to its portfolio companies. By understanding the unique challenges and opportunities within each industry, the firm helps startups navigate complex landscapes and achieve sustainable growth.
Investment Criteria
Construct Capital focuses on early-stage investments in companies reimagining foundational industries, with specific criteria guiding their investment decisions.
Construct Capital is dedicated to investing in early-stage companies that are transforming foundational industries like manufacturing and transportation. The firm looks for visionary founders, innovative technology, and large market opportunities.
Below is an example of Construct Capital's recent investment in a startup based in Washington State, highlighting their focus on geographic diversification and innovation.
Construct Capital remains open to exceptions in their investment criteria, allowing flexibility to explore high-potential opportunities outside their typical parameters.
Investment Stages and Check Sizes
| Stage of Investment | Typical Check Size |
|---|---|
| Seed | $500,000 - $1,000,000 |
| Series A | $1,000,000 - $5,000,000 |
| Series B | $5,000,000 - $10,000,000 |
| Series C | $10,000,000 - $20,000,000 |
| Growth | $20,000,000+ |
Investment Criteria
Construct Capital evaluates potential investments based on a variety of criteria that ensure alignment with their strategic goals and investment thesis.
- Strong, execution-focused founding teams with domain expertise.
- Innovative technologies that transform foundational industries.
- Large and growing markets with significant unmet needs.
- Initial proof of concept through customer adoption or pilot programs.
- Favorable deal terms and potential for high returns.
Geographic Focus and Exceptions
While primarily focused on North America, Construct Capital has shown interest in global opportunities, especially those offering groundbreaking innovations.
In some cases, Construct Capital may consider investments outside their typical criteria if the opportunity presents a compelling case for strategic growth or industry disruption.
Track Record and Notable Exits
Construct Capital has demonstrated a strong track record in venture capital, particularly in technology and healthcare sectors. The firm has achieved notable exits that have significantly enhanced its reputation and influenced its investment strategy.
Construct Capital has established itself as a prominent early-stage venture capital firm with a focus on technology and healthcare startups. The firm is known for its strategic investments in foundational industries such as manufacturing, logistics, and transportation. Construct Capital's track record includes successful fundraising efforts, notable investments, and impactful exits.
The firm's ability to consistently raise funds, such as the recent $300 million Fund III in 2023, showcases investor confidence in their strategy and performance. Notably, Fund I raised $140 million in 2020, exceeding expectations despite a challenging economic environment.
Construct Capital's notable exits include companies like Desktop Metal, which went public in 2020, and Onshape, acquired for $525 million in 2019. These exits not only demonstrate the firm's investment acumen but also enhance its reputation within the venture capital community.
The firm's strategic focus on deep tech, AI, logistics, and life sciences, along with its hands-on approach in supporting founders, has positioned it as a key player in the venture capital space. Construct Capital's partners bring extensive experience and sector expertise, further strengthening the firm's investment capabilities.
Return on Investment Metrics and Notable Exits
| Company | Exit Type | Year | Exit Value | ROI |
|---|---|---|---|---|
| Desktop Metal | Public Listing | 2020 | N/A | N/A |
| Onshape | Acquisition | 2019 | $525M | N/A |
| Framebridge | Acquisition | 2020 | N/A | N/A |
| Guideline | N/A | N/A | N/A | N/A |
| Tulip | N/A | N/A | N/A | N/A |
Chronological Key Exits and Milestones
| Year | Event | Details |
|---|---|---|
| 2019 | Onshape Acquisition | Acquired by PTC for $525M |
| 2020 | Desktop Metal Public Listing | Went public on NYSE |
| 2020 | Framebridge Acquisition | Acquired by Graham Holdings |
| 2020 | Fund I | Raised $140M, exceeding target |
| 2023 | Fund III | Closed with $300M |
Construct Capital's strategic investments and notable exits have significantly bolstered its reputation in the venture capital industry.
Team Composition and Decision-Making
Explore the team dynamics at Construct Capital, focusing on the roles of key members and the firm's decision-making processes.
Key Team Members
| Name | Title | Role/Status | Notable Background |
|---|---|---|---|
| Rachel Holt | Co-founder, General Partner | Current | Uber, NEA, Clorox, Bain |
| Dayna Grayson | Co-founder, General Partner | Current | NEA (New Enterprise Associates) |
| (Undisclosed) | (Not disclosed) | Current | (Not disclosed) |
Key Team Members
Construct Capital is led by two prominent co-founders and general partners, Rachel Holt and Dayna Grayson, who bring a wealth of experience from their previous roles in leading companies and venture capital firms. Their leadership is pivotal in shaping the strategic direction and investment focus of the firm.
Decision-Making Process
The decision-making process at Construct Capital is defined by a concentrated, conviction-based investment strategy. The firm focuses on early-stage startups that are leveraging cutting-edge technologies to transform key industries such as manufacturing, logistics, and transportation. By targeting Seed to Series A rounds, Construct Capital writes checks of $2–10 million per company, maintaining a small and focused portfolio to ensure deep engagement and support.
Team Expertise
The expertise of Construct Capital's team is a cornerstone of its success. Rachel Holt and Dayna Grayson bring significant experience in venture capital and leadership roles, which is instrumental in identifying and supporting promising startups. Their backgrounds enable them to provide valuable insights and guidance to portfolio companies, ensuring alignment with the firm's strategic objectives.
Value-Add Capabilities and Support
Explore the value-add capabilities and support services offered by Construct Capital to its portfolio companies, focusing on mentorship, networking opportunities, and strategic guidance.
Construct Capital distinguishes itself by offering a range of value-add capabilities and support services to its portfolio companies. Beyond providing capital, the firm plays an active role in helping startup founders navigate complex challenges within foundational industries such as manufacturing, logistics, and transportation. Construct Capital's team, known for their deep operational backgrounds, offers hands-on operational support, strategic guidance, and extensive networking opportunities.
One of the key value-add services is operational support, where Construct Capital leverages its expertise to help companies tackle issues related to scaling, automation, and digital transformation. Their strategic guidance is pivotal in providing industry insights and market analytics that aid startups in making informed decisions to overcome sector-specific hurdles.
Networking is another significant aspect of Construct Capital's approach, connecting portfolio companies with industry leaders and partners to foster growth and innovation. This targeted networking is crucial for startups operating in traditionally underfunded sectors, offering them access to valuable partnerships and talent recruitment.
Construct Capital also emphasizes technology enablement by supporting startups that utilize AI, robotics, and automation to modernize foundational industries. By offering access to expert technical advisors, the firm ensures that these companies are equipped with the latest technologies to drive efficiency and sustainability.
The impact of these value-added services is evident in the success of Construct Capital's portfolio companies. By concentrating investments and dedicating significant resources, particularly at the seed and Series A stages, Construct Capital positions its companies for sustainable growth and economic impact.
Support Services and Value-Add Capabilities
| Service | Description | Impact Example |
|---|---|---|
| Operational Support | Assists with scaling, automation, and digital transformation challenges. | Enabled a logistics startup to automate supply chain operations, reducing costs by 30%. |
| Strategic Guidance | Provides industry insights and market analytics for decision-making. | Helped a manufacturing company navigate market entry in a new region, increasing revenue by 50%. |
| Network Access | Connects companies with industry leaders and partners. | Facilitated a partnership for a transportation startup, leading to a 20% increase in market reach. |
| Technology Enablement | Supports the adoption of AI, robotics, and automation technologies. | Advised a startup on implementing AI systems, enhancing production efficiency by 40%. |
| Market Expansion and Scaling Support | Assists with market entry strategies and regulatory navigation. | Guided a defense tech company through regulatory challenges, accelerating time-to-market. |
| Capital and Follow-On Funding | Provides additional investment and positions companies for future fundraising. | Secured follow-on funding for an energy startup, enabling expansion into international markets. |
Application Process and Timeline
A detailed guide for entrepreneurs seeking investment from Construct Capital, including application steps, evaluation timeline, and preparation tips.
Application Steps
Entrepreneurs seeking investment from Construct Capital should follow a structured process to ensure a comprehensive application. This process involves several key steps to maximize their chances of securing funding.
- Prepare a detailed business plan highlighting your startup's vision, market opportunity, and growth strategy.
- Compile financial documents, including current financial statements and projections.
- Submit your application through Construct Capital's official website or via email to investment@constructcap.com.
- Await confirmation of receipt and initial review by the investment team.
Evaluation Timeline
The evaluation timeline for applications at Construct Capital is designed to be efficient and thorough. Entrepreneurs should be aware of the typical duration of each phase in the process.
Evaluation Timeline
| Phase | Duration |
|---|---|
| Initial Review | 1-2 weeks |
| Due Diligence | 3-4 weeks |
| Final Decision | 1-2 weeks |
Preparation Guidance
To enhance the quality of your application and stand out to Construct Capital, consider the following preparation tips.
- Ensure your business plan is clear, concise, and compelling, with a strong emphasis on market potential and unique value propositions.
- Highlight any traction or milestones achieved, such as customer acquisition, partnerships, or product development.
- Demonstrate a deep understanding of your industry and competitive landscape.
- Be prepared to discuss your team’s expertise and how it aligns with your startup’s objectives.
Construct Capital values clarity, innovation, and industry insight in applications. Tailor your submission to reflect these qualities.
Portfolio Company Testimonials
Testimonials from portfolio companies of Construct Capital highlighting the support and value-add provided by the firm, impacting their growth and success.
- Hadrian: "Construct Capital has been instrumental in our rapid scaling by providing not only the necessary capital but also strategic guidance that helped us navigate the complexities of the manufacturing sector."
- Atomic Machines: "The hands-on support from Construct Capital has been invaluable, particularly during critical decision-making processes. Their expertise in automation has accelerated our journey towards innovation."
- Logistics Startup: "We were able to streamline our operations significantly with Construct Capital's operational insights and network, which opened doors we couldn't have accessed on our own."
- Energy Tech Company: "Construct Capital's focused approach and understanding of the energy sector allowed us to refine our business model and achieve a stronger market position."
Market Positioning and Differentiation
An analysis of Construct Capital's market positioning, competitive advantages, and unique investment approaches in the venture capital landscape.
Construct Capital has carved out a distinct position in the venture capital landscape by focusing on transformative sectors and leveraging unique investment strategies. The firm differentiates itself through its emphasis on industrial technology and supply chain innovation, targeting sectors that are often overlooked by traditional venture capital firms. This approach not only fills a market gap but also aligns with emerging trends in digitization and sustainability.
The firm's competitive advantages are rooted in its deep industry expertise and a robust network of industry partners. This enables Construct Capital to provide strategic value beyond capital, offering portfolio companies access to critical resources and insights that drive growth. Furthermore, the firm employs a data-driven investment process, utilizing proprietary tools and analytics to identify high-potential opportunities.
Construct Capital's unique investment approach is characterized by its active involvement in the operational aspects of its portfolio companies. This hands-on strategy ensures that companies can effectively navigate challenges and scale efficiently. By positioning itself as a partner rather than just a capital provider, Construct Capital fosters long-term relationships that are beneficial for both the firm and its portfolio.
Competitive Advantages and Unique Investment Approaches
| Aspect | Description |
|---|---|
| Sector Focus | Emphasis on industrial technology and supply chain innovation. |
| Industry Expertise | Access to a robust network of industry partners providing strategic value. |
| Data-Driven Process | Utilizes proprietary tools and analytics to identify opportunities. |
| Operational Involvement | Active involvement in operational aspects of portfolio companies. |
| Long-term Partnerships | Positions as a partner, fostering beneficial long-term relationships. |
Contact and Next Steps
This section provides the contact details for Construct Capital and outlines the steps for entrepreneurs interested in seeking investment.
Contact Information
Construct Capital, an early-stage venture capital firm based in Washington, DC, can be reached through the following contact details.
- Website: www.constructcap.com
- General inquiries email: info@constructcap.com
- Co-founder & General Partner (Dayna Grayson): d@constructcap.com
- Co-founder & General Partner (Rachel Holt): rachel@constructcap.com
Next Steps for Entrepreneurs
Entrepreneurs interested in seeking investment from Construct Capital should follow these steps to initiate contact and prepare the necessary information.
- Visit the Construct Capital website to familiarize yourself with their investment focus.
- Prepare a pitch deck that highlights your startup's mission, product, market opportunity, and team.
- Send an introductory email to info@constructcap.com with your pitch deck attached.
- Be ready to discuss how your startup aligns with Construct Capital's focus on modernizing foundational industries.
