It’s no secret that home prices are on the rise of late, but this is due to more factors than some may think to consider. Aside from the increased costs of land and labor, part of the reason housing has become more costly is due to the price of the construction materials that comprise the buildings we live in. Ultimately, this is the issue that procurement platform Agora is aiming to solve, and the company just landed $33 million in fresh funding to get to work.
“American cities are facing a huge affordability crisis. Just between May 2020 and May 2021, home prices saw their biggest increase in more than two decades, and construction material prices increased by 24 percent year over year,” Maria Rioumine, Agora’s CEO and co-founder, told Built In. “The cost of renting has risen faster than renters’ incomes have for 20 years now, and specifically in [San Francisco], the median rent for a one-bedroom apartment is now $2,720 a month, which is the highest in the country, and construction has a huge role to play in fixing this affordability crisis.”
The company raised its Series B round to further its mission of making construction a faster and more efficient process to help address this crisis. To do this, it operates a platform that digitizes the construction supply chain for commercial trade contractors. Likening itself to Amazon, Agora offers an app that features 400,000 cataloged parts that are easy to find. Instead of writing out a list of parts needed for a project and risking costly incidents like over-ordering or receiving the wrong pieces, users are able to find and order exactly what they need in a matter of seconds.
Additionally, the platform works to drive transparency and seamless communication between office and field teams. It automates tasks like data entry, quote requests, order tracking and issuing purchase orders, saving office teams up to 75 percent of time spent processing orders and field teams 38 percent of time managing materials.
“Construction is an industry that’s historically been underinvested in technology, it’s also an industry that’s been very slow to change,” Rioumine said. Despite the industry’s $10 trillion value and 200 million workers, structured labor has only increased by 0.1 percent since 1947, according to the company. “That’s really changing, especially after the Covid-19 pandemic and [now that] a lot of companies realized they need to have a system of record that is cloud-based.”
Agora’s industry-specific solution has garnered plenty of positive attention from customers and investors alike, leading to its rapid growth since the time of its seed round in 2018. The company currently processes over $140 million in annual materials orders for its customers, and has increased its revenue by 760 percent in the past year. Agora has also expanded its services across 30 states and tripled the size of its team to 47 people.
Tiger Global led the latest round of funding for Agora, and the company is planning to invest most of it in building out its team even more. It’s hiring across all departments with roles available in customer success, sales, design, product and engineering with hopes to triple its headcount again next year.
The company is also heavily investing in R&D. Agora is building out new features like inventory management as it looks to expand its product into new verticals. Currently serving electrical trade contractors, it’s planning to grow into the mechanical trade sector in the future.
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