By Eve Gumpel, California Business Journal
Every construction company has the same horror story: Embroiled in a dispute, they hire a team of lawyers at great expense to go through their day-by-day onsite documentation – and the documents turn out to be illegible or incomplete.
Launched in 2014, Raken is a mobile software application designed for construction superintendents and job foremen to document daily progress in just minutes a day, onsite, using a cell phone.
The app struck an immediate chord: Raken (from “rakentaa,” Finnish for “to build”) has over 3,000 customers in 92 countries around the world.
Named the top daily reporting software and one of the top five mobile apps for construction in 2015 by the Associated General Contractors of California, Raken is also an investor’s dream. Last year, the company raised $2 million in a seed round. This year, in June, it raised another $10 million in a first round of venture capital funding.
“It allows us to do what we want to do a little faster,” says founder and CEO Kyle Slager. “The money will go toward delivering additional features and workflows our customers are asking for.”
Until Slager created Raken, construction superintendents and job foremen typically completed documentation onsite at the end of the day, using pen and paper. That created a twofold problem for companies. First, management in the office couldn’t access the reports quickly. Second, supervisors in the field had to spend over an hour compiling their report at the end of the day while everyone else is heading home. Over time, the quality of the reports naturally diminished.
Raken solves all of these problems. With the innovative app, workers in the field can compile their reports a few minutes at a time throughout the day, rather than stay on site after the day’s work is complete. And project managers and engineers in the office can view updates from the job site in real time.
“There is so much incredibly valuable data in these reports that could allow these companies to catch very small problems before they become big problems,” Slager says. “Catching delays when they happen. Catching safety incidents so they’re handled properly by human resources.”
What makes the app so universal – and what has allowed the company to advance so quickly – is that a one-person carpenter working on a bathroom remodel has exactly the same workflow as commercial construction contractor Webcor does while building the $1.3 billion San Francisco Transbay Transit Center.
“Commercial does it the same, residential does it the same, plumbers do it the same, general contractors, electrical – they all handle workflow the same,” Slager says.
“We’re pretty much building things the same way the Romans did,” says Sergey Sundukovskiy, who joined the company in 2015 as Co-Founder, Chief Technology and Chief Product Officer.
In addition to the Transbay Transit Center and the $1.1 billion Salesforce Tower, both under construction in San Francisco, Raken was used during construction of the Atlanta Falcons’ Mercedes Benz Stadium.
Sundukovskiy, who is a mentor for Google, recently walked to Google’s San Francisco campus from his hotel a few blocks away. “While walking the four blocks, I counted five projects we’re on. That was super exciting,” he says, adding with a laugh, “It took me an hour to get to Google because I stopped at every job site.”
Raken is a common requirement in postings for construction jobs, Slager says. The app has also helped clients win bids. “Companies will show off how they handle their daily reports in Raken, which helps them stand out to the owner,” Slager says.
Recently, a client bidding on a project in Houston, Texas, told Slager: “We always show off Raken – but now every company we’re bidding against is using it too.”
That’s fine with Slager, who sees it as proof Raken is providing value to companies across the country. Typically, Sundukovskiy says, construction software gets selected in the office instead of the field. As project management software, it’s often too cumbersome or complicated to use in the field.
By contrast, Raken’s software is designed specifically for the field. “The office can consume it any way they want – but the field has to be very specific. It has to be simple, and it has to be useful,” Slager says.
Slager and Sundukovskiy have both worked in the construction industry – in fact, Slager’s father was a home developer, so he spent summers and his college years on job sites. But neither of the two men is an industry insider. So when Slager decided to focus on the construction industry, he interviewed more than 120 construction companies of all sizes.
Getting in to see them was a challenge. He got his first three introductions from people in his network. From there, he says, “Every meeting, I had to ensure I was providing enough value that they would introduce me to someone else. “I told them, ‘I’m going to build this directly off your feedback for free. And then when I’m all done building what you’re asking for, you can decide whether to pay $30 per month.’ I’d come back two weeks later and show them all the updates on the screen. So it made them happy to make those other introductions.”
Raken has been translated into Spanish and Portuguese. People in countries around the globe are using it because, as Sundukovskiy says, “You can keep track of daily activities using whatever language you like. The labels are going to be in English, for now. But that’s all the English you need to know.”
Sundukovskiy and his team are actively working on localizing the app into additional languages. Sometimes foreigners learn about the application because someone based in the U.S. is working on a project a foreign country. Sometimes they simply find Raken in the App Store or Play Store. “After all,” Sundukovskiy says, “They build projects just like we do in the U.S.”
Where does Raken plan to be in two or three years? “We want to be the field solution that empowers the construction field,” Slager says. “So when they think of all of those high-frequency workflows they have to handle, they think of Raken.”
That requires two things, according to Slager:
Sundukovskiy adds, “If we lose touch with the customers, they stop recommending us – and we stop expanding.”
Raken presently has 53 employees, and Slager expects to reach 100 by the end of the year. The office is located at the MAKE complex in Carlsbad, Calif., a collaborative work environment for tech companies, including GoPro and Verve Wireless. The complex, which is walking distance from the beach, boasts a gym and fitness facilities, along with surfboard racks, outdoor showers and bikes tenants can use whenever they want. “When you need to take a break, you can sign up for a workout,” Slager says. “Or simply grab a bike.”
Raken’s company culture is well-defined, with new hires expected to be in alignment from the get-go. “We use an inverted pyramid management philosophy. There’s no HiPPO (highest paid person’s opinion) policy,” Slager says. “Customers are at the top. Anyone who interfaces with customers is one step below. Managers and senior staff are to empower and support those people who interact with our customers. And then the CEO empowers senior staff. It’s very intentional because, at the end of the day, the people who are going to have the greatest feedback are the people spending the most time closest to the customer.”
“If you’re always right,” Sundukovskiy says of Slager and himself, “that means hiring standards have diminished; you’re not hiring people as capable as you are – which is the opposite of what you want to be doing.”
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