NUMBER FIVE – More than 70% of construction work placed in the US is done by companies with less than 4 employees. These companies are mostly our subcontractors. Most do not have the strong financial wherewithal that the GC does. The materials they procure account for ~40% of their cost. Few earn anything close to the best prices available at risk-wary material providers due to most subs’ limited financial wherewithal and history of slow payment. At the same time, for the same reason, trade credit is constrained to these subs, making it difficult to keep enough material ahead of productive crews; especially if any project is paying slowly. Although everyone reading this pays their bills on time, there are many others who – from time to time – do not or cannot. Draw schedules from banks and other funders are not designed to optimize construction efficiency. They are designed to protect the funders against any performance issues (which their hardened draw schedules tend to contribute to). The disadvantages of subcontractors become the direct burdens that projects carry. Why couldn’t financial technology be used to satisfy the predefined conditions required to protect all the participants, reduce the unnecessary project cost/schedule burdens and elevate buying power to the owner or even funder levels?

What is BuildPay?

BuildPay uses financial technology that connects the entire payment chain, enabling fast, direct payments, quicker build times (encouraged by better payments), and better material pricing (made possible by guaranteed payments). Construction the way it should be. #GotPaid

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