Gearflow raises $ 3 million to create must-have construction market

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Critical equipment and parts constantly break down when used in the construction industry. The downtime of these broken machines not only impacts the contractor who depends on them, but it can also prevent the entire construction project from being completed on time and on schedule. Securing replacement parts or equipment is mostly done using spreadsheets and personal relationships, which can be too slow given the urgency of the immediate delay. Luke Powers and Ben Preston rectify this archaic, relational process with their Gearflow solution. Gearflow is the first all-in-one window for contractors in need of equipment and parts. The Chicago-based startup raised $ 3 million in a funding round led by Watchfire Ventures, with participation from Newark Venture Partners, Liquid2 Ventures, Path Ventures, Harvard Business School Angels and CNH.

Frédéric Daso: In the event of a critical equipment failure, what options or redundancies do construction companies have in place to ensure they can complete their project on time and within budget?

Ben Preston: This is best told through the lens of a fleet manager of a mid-sized entrepreneur in Omaha, NE, whom I recently interviewed who manages a fleet of 1,000 units.

When a piece of equipment fails, the equipment operator notifies the equipment superintendent. There are about 60 superintendents on the team, with up to 15 on a single job. The superintendent then calls the shop foreman, a single point of contact overseeing fleet maintenance and a team of 8-10 mechanics. The shop foreman sends a mechanic on-site who diagnoses the problem, locates the required parts, fills out the work order that ties the costs to the unit number and the job, and repairs the equipment. Finally, the fleet manager makes a maintenance and repair report at the end of each month to aggregate all the costs of the fleet, compares them to the budget and tries to identify the reasons for the budget overrun. This process, since everything is done offline, causes countless headaches for the fleet manager.

He has mechanics chasing parts for 2-3 hours a day which is driving him crazy as it should be time to go to “turning keys”. It has 1,000 work orders generated per month, making it difficult to identify where the delays occurred, where they overpaid for parts, where there might be operator error and when the costs. should be “billed at work” instead of being paid for. All of this activity is monitored retroactively in monthly reports, so even if the fleet manager identifies a problem, it is often six weeks too late.

This workflow is the common model. But, unfortunately, there are many employees and suppliers relying on fleet maintenance, so productivity suffers from hundreds of micro-lags when sourcing parts.

It is death by a thousand cuts.

We set out to solve the most basic needs first and bring all the great parts suppliers together in one place so that contractors can quickly get all the parts they need from trusted suppliers so they can get back to work.

Streamlining parts supply allows us to eliminate all of the other productivity issues that come with it.

Daso: What are the dynamics that lead to long lead times for ordering, manufacturing and delivering spare parts?

Preston: Entrepreneurs generally rely on mixed fleets of equipment of different ages to do their jobs.

Most dealerships want to minimize parts inventory to keep costs down. Meanwhile, every year OEMs manufacture new equipment with different part numbers and arrangements. Therefore, pieces of equipment are a very long tail category. Long lead times arise from the dichotomy between the number of parts required by fleet owners to keep their equipment running and the number of parts readily available at the local dealership.

Contractors need a wide range of parts to run their equipment that is not on the shelves of the local dealership. Unfortunately, this means fleet owners and their technicians are either subject to the lead times of a single parts supplier or have to spend hours a day trying to find the parts they need.

Daso: What are some of the attractive characteristics of SME entrepreneurs that make them an attractive beachhead market?

Preston: Construction has the highest concentration of SMEs of any sector, with the top 5 construction companies accounting for only 2.5% of the total market. Larger subcontractors have procurement teams, OEM OEM white glove service, and enterprise software to streamline fleet maintenance.

For the vast majority of the industry, this is not the case. We believe productivity suffers in construction because the majority of the industry is underserved. So we decided to help entrepreneurs who just want to buy the parts they need from trusted suppliers so they can get back to work. Because we can solve this most basic need today, we can now address the fleet maintenance issues experienced by owners of larger fleets.

Daso: How did Gearflow build its marketplace to solve the connection issues between manufacturers and sellers of equipment parts and buyers of construction companies?

Preston: Gearflow is designed from the ground up to be a seller-aligned marketplace. The one who creates and strengthens the supplier-buyer relationship, not the one who shifts that relationship. A marketplace that adds a thin layer of technology to the existing parts supply chain, not one that disrupts it.

We do this by continuing to build the tools our suppliers need to grow their business independently through the platform, whether they sell direct to consumers or through their existing dealer network.

As a result, contractors have access to all the parts they may need, transparency of the status of all their orders, and increased efficiency of their entire parts procurement process. Our vision is not simply to be another source of parts, but rather to be the parts purchasing platform that entrepreneurs can rely on to eliminate the wasted time, money and productivity that stem from today’s fleet maintenance process.

Daso: Beyond being a marketplace, does Gearflow help construction companies and parts manufacturers develop predictive analytics when parts fail and need to be replaced?

Preston: We see ourselves as being in the productivity business, not just in the parts business. A good supply of parts opens up additional opportunities to increase the productivity of job sites and fleet teams across North America.

Our number one goal is to enable contractors to quickly get all the parts they need from trusted parts suppliers so they can get back to work. In doing so, we create a unique data engine that can be used to inform many functions, including preventive maintenance and fleet management.

Daso: What behaviors did your co-founder, Luke Powers, learn while running the family business that shaped the culture of Gearflow?

The number one lesson Luke inherited from the family business he brought to Gearflow was the importance of trust in the construction industry. Trust has created generational relationships that are hard to find in other industries. But, unfortunately, there is also a lot of mistrust in the construction industry, especially of technology.

Trust is a prerequisite for our success. Parts suppliers must trust us to participate in the platform. Likewise, entrepreneurs must trust us to find their parts through the platform. Unfortunately, this trust takes a long time to build and can be lost very quickly.

Therefore, the decisions we make about building the platform, how we market and who we hire are all designed to strengthen the trust we’ve built in the industry and the relationships we’ve built. with our clients.

Daso: How do you rate subject matter expertise when interviewing potential Gearflow employees?

Preston: We value expertise in this area, in particular for our customer support roles. However, we value entrepreneurship more.

The entrepreneurial spirit is accompanied by independent motivation and a thirst for learning, making our team a successful team. We found that people who have a side project, have founded businesses themselves, or have some sort of independent activity such as music, art, athletics, or thought leadership had lifted the whole team. There is a willingness to act quickly, to be comfortable with ambiguity, and to stay motivated independently, which is inherent in these kinds of people. As a result, we are all energized by this huge problem that we are solving for people who do real work.

Someone who comes up with this mindset can quickly become an expert on it. However, this heartbreak is a difficult thing to learn and develop.


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