VC Foundamental Closes Second Fund at $85M as It Seeks to Disrupt the Multi-Trillion Dollar Construction Industry

After raising $65 million for its first fund, construction-focused venture capital firm Foundamental has raised $85 million for its second fund to increase its dry powder for start-ups in what it sees as a $12 trillion market opportunity.

The portfolio from Foundamental’s first fund is getting rave reviews on the heels of its aggregate $5.4 billion valuation, three exits, including the unicorn-valuation InfraMarket, and seven further companies Foundamental says have cleared a $100 million+ run rate.

In the past three years the portfolio has amassed more than $1.2 billion in venture capital, and about 81% of its investors subsequently clinched follow-on fundraises.

Many new funds and initiatives have emerged to support entrepreneurs, with Building Ventures recently closing a $95 million fund for construction tech and real estate startups, while Agya Ventures announced a $32 million fund. Brick & Mortar Ventures, meanwhile, launched an early-stage accelerator billed as the “Y Combinator of construction tech.”

Founded in Berlin in 2018, Foundamental counts three general partners, each focused on distinct regions. Patric Hellermann covers Europe, while Shub Bhattacharya is focused on Asia-Pacific (APAC) and Adam Zobler centers on North America.

“Construction is the biggest, undisrupted market in the world,” Zobler. “It’s a 12 trillion-dollar market — 10% of the world’s GDP — which employs one in fourteen workers globally. Yet the construction and built-world industry is massively inefficient, and it’s getting worse.”

It noted that it’s aiming for a “larger portfolio” of around 40-50 companies, and plans to invest across pre-seed, seed, Series A and Series B rounds, with check sizes amounting to nearly $3.5 million.