Why We Invested: Green Badger
Green Badger is the most comprehensive construction sustainability platform and the leading SaaS platform for automating sustainability in the built environment.
At Hamilton Ventures, we are taking time this spring to share some of our earlier investments and introducing these portfolio companies to our expanded network.
First up is Green Badger.
As an investor, it's always exciting to meet with a company that is uniquely positioned for success in a growing market. When we were introduced to Green Badger in early 2022, the company certainly fit these criteria.
Green Badger serves general contractors, developers, design professionals, and sustainability teams with two main products:
LEED Documentation: This is a SaaS tool that automates the LEED application and reporting compliance process. This software, akin to TurboTax for green building projects, streamlines the process of taking a project through LEED, a generally cumbersome, analog, and time-consuming ordeal. Real estate organizations can save hundreds of man-hours per year on a project by implementing Green Badger’s solution. One customer we met stated this tool is “the single best way to streamline LEED project data within an organization.”
Construction ESG Platform: This product features Measure, Benchmark, and Report modules that allow firms to satisfy ESG and Corporate Social Responsibility (CSR) requirements. What we like about the platform is that it is NOT a generic ESG dashboard. It is customizable, intuitive, and leverages integrations to enable data transfer to other software and third parties. In particular, the platform includes a strong focus on social metrics in construction, including minority and women participation, project philanthropy and wellness monitoring. As construction labor shortages approach crisis levels, we think this focus is particularly compelling.
Our early-stage investing philosophy at Hamilton focuses heavily on the team managing the company. This is due to the fact that 99% of the time the product(s) will evolve significantly from Seed to Exit. With over 20 years of domain knowledge in LEED compliance Green Badger's Founder & CEO, Tommy Linstroth, is just the type of leader we like to invest in. Given that LEED v.1 launched only slightly before Tommy entered the industry, there are very few people better suited to build this company.
Couple Tommy’s passion and expertise with two high-caliber construction technology investors, Shadow Ventures (lead) and Groundbreak Ventures, who have many strong ties with Green Badger’s target customers, and we saw a blueprint for success.
One of our focuses from the beginning was assessing the future of LEED. Was LEED in danger of losing market share to competitive Green Certifications (i.e., BREAM, WELL, etc.)? Is there an economic return for building a LEED compliant building? Our due diligence confirmed that LEED is very much alive and growing. Cushman & Wakefield recently released a report showing that a LEED rating can significantly boost rents and occupancy in buildings, an important factor important in today’s challenging real estate development market. In 2021, ENR reported that the Top 20 green building contractors alone did nearly $50B in green design revenue. Significant industry tailwinds include a) California’s commitment to a net-zero built environment and b) the Inflation Reduction Act’s +$2B and streamlined permitting process dedicated to energy efficient building initiatives. All things considered, we became convinced that the domestic TAM for GreenBadger is north of $1B. With reports ranging from 11%-22% for the green building industry’s CAGR through 2028, and the substantial opportunity for Green Badger to expand internationally, we continue to see a compelling growth story in an underserved market.
Building to Net Zero
Any investment thesis is only as valid as the results. Since we have invested, Green Badger has maintained its demo-to-conversion rate at nearly 5x the industry average for B2B SaaS (which is 10%-25% depending on customer and industry). This is an eye-popping demand signal. The company has also continued its strong organic revenue growth and is working through strategic integrations with Procore and the AGC.
The investment capital in 2022 was used to enhance Green Badger’s LEED Documentation capabilities, update their mobile app, increase marketing efforts, and launch Green Badger’s ESG platform. At the time we invested there was no direct competitor for LEED compliance, and minimal options catering to the construction and development market with a comprehensive ESG reporting tool that went beyond a generic dashboard.
We are happy to report the successful launch of the ESG platform and are excited to continue partnering with Green Badger as they enable an increase in sustainable and net-zero development world-wide.
At Hamilton Ventures we take great pride in our mission to help portfolio companies scale their businesses.
If you, or any real estate developers you know, are interested in Green Badger's offerings, please don't hesitate to reach out.
To learn more contact us directly, visit getgreenbadger.com, or schedule a demo by contacting email@example.com.
About Hamilton Ventures
Hamilton Ventures is a seed-stage venture capital firm investing in proptech and real estate tech startups. Today, real estate and technology are at an inflection point: AI, machine learning, data and analytics, and software-as-a-service are on the verge of wide deployment in real estate. Our definition of real estate is broad – covering residential, commercial, construction, climate technologies, and hospitality. Hamilton’s mission is to help proptech founders accomplish their goals by leveraging the collective expertise and network of our investors –former real estate CXOs, entrepreneurs, and financiers. Learn more at hamiltonventures.io.
Connect with Hamilton Ventures
If you are a proptech entrepreneur looking for guidance or capital please apply via our website, or contact TJ Fleming: firstname.lastname@example.org
If you are interested in investing in our portfolio opportunities, reach out to Prashant Kothari: email@example.com