A 10-year-old Greater Cincinnati startup is planning to use a recent multimillion-dollar raise to further expand its team and fuel a pair of new acquisitions as it continues its years-long double-digit growth streak.
Stack Construction Technologies, a Blue Ash-based construction tech startup, landed $17 million in new funding, led by Level Equity, a New York and San Francisco-based private investment firm. The raise was disclosed in a recent Securities and Exchange Commission filing and confirmed by Stack this week.
The funding more than doubles Level Equity’s initial backing of the company; the firm was Stack’s original institutional investor when Stack raised $7 million in growth equity in 2018.
Phil Ogilby, Stack’s co-founder and CEO, said the raise allows the company, one of the region’s fast-growing firms over the past five years, to further accelerate its efforts, including fueling a pair of acquisitions that will allow it to expand its software platform.
“We continue to broaden our footprint in the industry, and people are really starting to pay attention,” Ogilby told me. “It’s really an exciting time for all of us.”
Stack Construction Technologies, a SaaS, or software-as-a-service provider, caters largely to subcontractor community. Its cloud-based preconstruction software initially allowed for blueprint measuring and takeoff, or the process of determining how much of each material is needed to complete a job, but has since expanded into cost estimating and more.
“The size of the market is enormous; it’s part of what makes us attractive to investors,” Ogilby said. “Historically, the industry has left subcontractors behind; subcontractors are harder to find, and they have a high fail rate. But that focus makes us unique, and it’s been one of the drivers to our success.”
The additional capital will be used to further accelerate the company’s tech and fuel new product development.
Ogilby said Stack will soon be announcing two acquisitions to that effect — one that will allow the company to double-down on the preconstruction side of its platform and another that will further expand its reach into construction management. Stack last year acquired Montreal-based SmartUse Solutions, a construction collaboration software, and the company plans to add to that capability.
Stack has been in high-growth mode for several years. The company is one of the region’s fastest-growing firms with $8.9 million in revenue in 2020, a 86% increase from 2018. The year prior, the company reported 72% revenue growth. The company also ranked No. 2,696 on the Inc. 5000 in 2021.
Ben Levin, Level Equity co-founder and CEO, said Stack's “consistently high and increasing growth” was a big factor in the firm’s repeat investment.
“Stack continues to demonstrate its deep domain expertise. Delivering a platform that addresses the specific needs of the subcontractor is something we’re incredibly excited about,” Levin said in a release. “We think the next wave of innovation will aim specifically at subs. There is no more capable provider to knock it out of the park than Stack.”
Ogilby said Stack will increase its hiring efforts in the Cincinnati area, as well as its remote work opportunities. Stack, which was a team of three in 2015, currently employs 140. The goal is to increase that count to 200 within 12 months.
“We’re literally hiring as fast as we can,” he said.
“I am extremely proud of the team we’ve built,” Ogilby added. “We’re all dedicated to continuing to deliver a platform that provides the best preconstruction and construction solutions in the market and empowering our customers to bid, win and build more profitable work.”
