Green building is growing, but researching and evaluating the numerous green-building products available — and calculating which ones can help buildings rack up the most points toward earning coveted LEED certification — can cost the construction industry hundreds of hours per project, says Green Wizard CEO Adam Bernholz. “This is a pain,” he said, adding that contractors view the challenge of doing such research as “the No. 1 problem in green building today.”
Green Wizard, one of several companies that were looking for funding at the Cleantech Forum in San Francisco this week, hopes to help solve the problem with a cost-comparison platform that it claims will better enable architects, engineers and contractors to figure out the cheapest way to get the certification they want. Green Wizard plans to help contractors maximize every dollar they spend. “We empower our users to build greener structures for less money in less time,” Bernholz said.
The Charleston, S.C.-based startup, which has raised $250,000 million and is now seeking $4.5 million, is developing an online marketplace that it describes as “akin to Expedia meets Lending Tree” for green materials.
At a presentation this week, Bernholz said the company would offer its service for free to its users, and plans to make money by charging suppliers a 2 percent commission on the sales they make through the Green Wizard site. Clearly, getting a wide range of suppliers to ante up to participate in the site — without passing higher prices on to Green Wizard’s users — will be key to the company’s success. Users might not believe they are getting the best deals and the best advice if Green Wizard only suggests solutions offered by their customers and if only a few suppliers participate.
There’s some evidence that the construction industry is already interested, however. The company has a pipeline of projects with purchasing budgets totaling approximately $150 million that plan to use its software, Bernholz said. Green Wizard forecasts that it will see revenue of $11.8 million in 2011, when it expects it will need to raise a second round of about $2 million, and reach sales of $69.2 million — with an operating profit of $36.6 million — in 2013. That may sound like rapid growth for a tiny startup, but it represents just a tiny sliver of the overall green building market.
McGraw-Hill Construction in October released a report predicting that the green building market would grow from $36-49 billion this year to $96-140 billion in 2013, and Green Wizard says that the commercial buildings it’s targeting are expected to make up 25 percent of the 2013 total. So the business it’s counting on winning represents 0.1-0.15 percent of the predicted $24-35 billion commercial green-building market that year. Green Wizard is also one of our Green:Net 10 companies — check them out on March 24.