Around two-thirds of construction businesses fail in their first five years because they have nowhere to turn for help when it comes to ensuring payment. Startup Levelset aims to help these contractors by providing money management for contractors in construction, TechCrunch reports. The New Orleans-based start-up recently secured $30 million in funding.
For now, Levelset is focused on digitizing billing and payments and providing insights into who is actually on a job site and the responsibilities that those workers have on site, according to CEO Scott Wolfe.
“There’s a ton of investment that has gone into the field,” says Wolfe. “What has seen a lack of as prolific an investment are things behind the scenes outside of the field that happen in the office. This is the accountants and administrative workers who have to take the information that’s in the field and turn it into money.”
In a recent survey of contractors by Levelset and T-Sheets by Quickbooks, more than half of contractors stated they were not paid on time and had significant cash flow challenges, and more than 75% craved more transparency in the payment process. This is no surprise, given PWC’s working capital studies in the past decade demonstrating that construction industry payment speeds are the slowest of all (83+ days).
“The effort required to get paid, and the cash stress put on contractors is unbelievable,” said Wolfe, in a statement. “The world’s biggest industry is full of small and medium businesses who are the fabric of our economy. It’s crucial that they can do their work without worrying about cash.”
Read More
