Autodesk adds to its construction offerings, acquires BuildingConnected

Just when I think/hope the year is winding down, up pops another newsworthy item.

This time, it’s a twofer: Autodesk announced that the Plangrid acquisition is a done deal and that it’s signed a definitive agreement to acquire BuildingConnected to add tools for bid management, risk analysis and other preconstruction activities to its construction portfolio. This is a good thing, bringing to Autodesk more tools that bridge the gap between design and construction, helping contractors and owners run projects more efficiently and with lower risk.

BuildingConnected also brings with it a huge network of 700,000 construction professionals, all of whom present their services via the platform, creating a digital marketplace in which real estate owner/operators and general contractors can find qualified (sub)contractors. Autodesk says BuildingConnected’s customers include Turner Construction, McCarthy, Mortenson, StructureTone, Skanska, Clark Construction, Ryan Companies and AECOM — a who’s who of construction in North America.

The logic behind the acquisition is clear. As BuildingConnected CEO Dustin DeVan said in the announcement. “Together with Autodesk, we can expand the platform’s capabilities and scale globally.”

Autodesk CEO Andrew Anagnost said, “Autodesk’s goal is to connect construction processes across design, build and operations. BuildingConnected, along with Autodesk BIM 360, Revit, AutoCAD, and our acquisitions of PlanGrid and Assemble Systems, gives us a comprehensive construction offering and go-to-market capabilities. We look forward to integrating our recent acquisitions and making construction Autodesk’s next billion-dollar business.”

And that’s the challenge: these products do tread on one another’s toes a bit, and Autodesk will have to winnow through it all to remove the overlapping bits while keeping legacy customers and their businesses cranking over.

Autodesk is paying or $275 million (net of cash acquired) for BuildingConnected. The transaction is expected to close quickly, before January 31, 2019, and Autodesk says it will have no material impact on fourth quarter and fiscal year 2019 revenue or, for that matter, on fiscal year 2020. See Autodesk’s presentation about the deal here.

I have no solid data on BuildingConnected’s revenue but think it’s on the order of $10 million/year. Crunchbase says the company had raised $53 million in funding as of earlier this year, including from a large customer. So it’s not big — but that list of customers means it’s on to something good.

Autodesk has the pieces now for a concept to construction workflow that ends just before building operations — I wonder if that’s the next logical step for Autodesk.