Construction tech firm Veev raises $100 million through new Israeli exchange for equity in private companies
- Construction tech builder Veev raised $100 million through a new Israeli stock exchange platform.
- Tel Aviv’s TASE UP allows investors to invest and trade equity in private companies before they IPO.
- Veev uses panelized construction to build everything from micro homes to multistory buildings.
- See more stories on Insider’s business page.
Construction tech developer Veev announced Tuesday that it has raised $100 million in new funding through a new Israeli stock exchange that allows private companies to raise funds from accredited investors without an IPO.
The company, which began as a real estate development company in 2008 before pivoting to innovative forms of construction in 2015, uses panelized construction and 3D printing to build everything from tiny homes, formally called accessory dwelling units (ADUs), to large multifamily, multistory buildings.
The company raised funds through a new platform of the Tel Aviv Stock Exchange (TASE) called TASE UP, launched last year to create liquidity for shares of private companies, becoming one of the first companies to raise funds through the platform.
The company, based between the Bay Area and Israel has now raised nearly $200 million in total funding after last year’s $97 million funding round, led by Zeev Ventures and Lennar Ventures, the venture capital arm of leading homebuilder Lennar, which also included backing from Khosla Ventures.
Raising capital in new ways
Veev cofounder and CEO Amit Haller is no stranger to novel forms of fundraising.
In 2006, Haller took IXI Mobile via a special purpose acquisition company, or a SPAC, a financial instrument used to go public that was then a rarity but is now peaking in popularity — especially among real-estate technology companies. But the TASE UP platform which offer some investors shares in private companies, is a more unusual way to provide liquidity for early investors and employees in a company.
“A secondary market exists in the private market all day long, but the problem is that you and I can’t benefit,” Haller told Insider. “It’s only for the rich and connected people.”
So far, TASE UP only allows accredited investors and institutions to invest, but the pool of potential investors is still much wider than the venture funds and private growth funds who typically invest in technology startups.
What Veev does
Haller told Insider that the Veev turned to new methods for construction after dealing with frustration over the slow pace and high cost of labor and materials needed to build houses and apartment buildings.
Veev’s solution is prefabricated, panelized construction, which involves building panels that make up the walls of the building off-site in a factory that can then be put together quickly on-site. Haller cautions that the technology is not new, even if Veev’s current take on it might be.
“Even the Eiffel Tower was semi-prefab,” Haller said.
Veev’s innovation is to make panels complete with electricity, plumbing, and wireless smart devices already inside, making for a “Lego-like” building process on-site. The panels themselves are made with fire-resistant steel and high-performance surfaces that are antibacterial and can be fashioned into any color or design.
Putting together the panels on-site means that Veev can build four times faster than traditional processes, Haller said, and at competitive prices. The cost of replacing standard drywall with more expensive materials is offset by reduced labor costs because construction takes less time.
The company uses the same type of panels across construction sites: even in a homeless shelter the company built in San Jose, California. A recent story in the San Jose Spotlight, a nonprofit digital news site that covers the Bay Area city, alleged that the company’s shelter-building site was fraught with hazardous conditions and wage theft, even prompting one lawsuit.
“Our team takes these allegations very seriously, and we are looking more closely into the matter. It’s our initial observation that most of the accusations are inaccurate and are misreported. We’ll have more details to share once we’ve gotten to the bottom of the claims with relevant parties on our team,” A Veev spokesperson told Insider in an email.
The developer is also looking to add property management to its range of revenue possibilities. The smart devices inside of Veev’s panels doesn’t just allow occupants to control lights, but it monitors heat and moisture levels as well to help Veev recommend preventative maintenance or to detect a fire.
Veev manufactures buildings in California, the epicenter of the housing crisis. The company plans to build 800 units of housing this year, and according to its website.
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