A Chicago startup working on technology to power the smart buildings of the future raised $6.5 million on Thursday.
Cohesion, which makes a SaaS platform for building managers, raised the seed round from Hyde Park Angels, Singapore-based multi-national real estate group Frasers Property Group, investment firm CMT and a host of individual angel investors. Angels include Raj Gupta, the executive chairman of Environmental Systems Design, Ken Griffin, the founder and CEO of Citadel, and Michael Sacks, the CEO and chairman of GCM Grosvenor.
Cohesion’s technology was originally built by Chicago-based Environmental Systems Design (ESD) to manage operations at 151 N. Franklin St., a downtown building home to Facebook’s Chicago headquarters. But in August 2018, co-founder and CEO Thru Shivakumar launched Cohesion as an official ESD spin-off venture.
Shivakumar, who has a background in corporate finance and real estate, worked at World Business Chicago, Hyatt Hotels and Baxter before launching Cohesion.
The startup’s software bundles operating tasks into one platform for building managers, allowing them to distribute mobile keycards to tenants, facilitate waiver signings, and give tenants an easy way to book building amenities and make maintenance requests, among other things.
“Let’s say there’s a happy hour that a tenant is throwing or a corporate event a tenant is throwing, they could go into our platform and book it themselves without having to send emails,” Shivakumar said.
Through activity on the platform, Cohesion also gives building managers useful data, such as how and when tenants are using building space, which can help managers decide when and where they need more staff on site.
Cohesion mainly sells its SaaS platform to Class A office buildings, which tend to be newer and larger downtown buildings with several amenities. It currently has seven individual clients, but combined, they represent 10 million square feet, Shivakumar said. Clients include The John Buck Company, Transwestern, Frasers Property and Riverside Investment & Development.
Besides Chicago, Cohesion works with building managers in Boston, Montreal, Toronto and Singapore.
Though the Covid-19 crisis has kept many office workers at home, Cohesion’s business hasn’t struggled, Shivakumar said. Instead, because of Cohesion’s ability to give building managers insight into how tenants use building spaces, the platform can be useful in helping them know where to sanitize and prevent the spread of Covid as workers begin coming back to offices.
“What Covid has shed light on is that buildings have to adapt and be flexible to this evolving environment,” Shivakumar said. “And they need to invest in technology to do so.”
A Fortune Business Insight report in January estimated that the global smart building market will reach $109 billion by 2026, up from $43 billion in 2018.
Cohesion employs 11 people in Chicago, 14 people in India, and is looking to fill 25 full-time positions across its product development, sales, marketing, implementation and customer success departments.
“What we’re forging the path towards is autonomous buildings,” Shivakumar said. “That, I think, is the future of buildings.”
