🦄 Unicorner Special Edition

✍️ Notes from the Editors

Today’s article is brought to you by Konexi. Learn more about how they’re revolutionizing hiring remote technical talent.

It’s always a fun week when we have a special edition at Unicorner. We have to re-imagine what the article is going to look like, and then we get to deliver content in a special way. It’s like Christmas, but the present is unique content.

Derek Wong is back this week with one goal: to make the world of construction sexy. He wants to get your thoughts on his deep dive. Reach out to him on Twitter with your questions and comments on the article.

- Arek and Ethan 🦄

The construction industry is like Chuck E. Cheese — Kids love it, but adults hate that it even exists.

When I was young, I fawned over the towering presence of a crane, the powerful strength of a bulldozer, and the seemingly infinite cycle of a cement truck. Their grand size and power ran rampant in my imagination. I know I’m not the only one. Many people reminisce on a childhood filled with legos, Lincoln logs, and wooden blocks. 

Growing up, walking by a construction site was cooler than a Chuck E. Cheese. Those animatronics had nothing on a crane that lifted supplies hundreds of feet in the air. 

But somewhere along the line, construction became nothing more than a reason why I’m late. It backs up traffic and takes parking spaces away. It’s loud, annoying, and at best, inconvenient. 

But construction matters more than I thought. Not only is it one of the biggest markets in the world, approximately $12 trillion a year, but it has a significant impact on our lives. 

Every sidewalk, road, and building you occupy was built and maintained by a construction company. These structures, which we interact with every day, lose their luster because of the simple fact that it’s boring. We overlook the world around us.

This invisible nature hides the immense value and importance that the construction industry holds. And this makes it a sleeping giant. 

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Silicon Valley Solves Hard Problems, Right?

In the last few years, Crypto and AI have taken the world’s attention and held it hostage. Suddenly the greatest fear is that AI is going to take all our jobs and kill us all, or that AI is going to bring us a utopia of peace, prosperity, and joy. While some of the hype may be true, a lot is just that — hype. Silicon Valley runs on hype (and Patagonia vests). While construction might not be hype, it is crucial to solve the important problems in our lives. 

While AI may bring a generation of technological change, it does little to solve the major problems in our everyday lives. We face a national housing crisis. The perennial problem of our generation involves a basic human need: having a place to call home. 

In the Bay Area, where I live, you can ask anybody what their biggest concerns are. Chances are, you get something along the lines of “rent is too high!” or “there’s too many homeless people out on the streets.” Is it any surprise that these two are connected? The root problem is a lack of housing. 

It’s not just residential construction that needs a boost. The U.S. government has committed to spending $1.2 trillion to help with crucial infrastructure around the country. Everything from highway transit and rail programs to clean water and electric grid renewal. But this isn’t enough. We need to see more investment and innovation from Silicon Valley to accelerate progress in the construction industry, as it has with many other industries.

Around the world, technology has completely revolutionized our lives. From the internet being able to allow us to call our girlfriend in Tokyo, to the smartphone giving us a computer more powerful than NASA’s computer for the moon landing in the palm of our hand, our lives seem unfathomable to anyone living 50 years ago. Entire industries have been overhauled — except for construction. In the world’s technological innovation hub, someone can solve this problem, right?

The Construction Landscape

The construction industry has minimally changed in the last 100 years. By any metric you could measure productivity, construction has become worse over the 30 years. It is expected for projects to run late and go over budget. 98% of megaprojects (projects with an initial budget of $1 billion and span several years) are delayed or over budget. There’s a 21.4% industry-wide turnover rate, making it one of the most volatile. These problems hamstring any progress we make in building homes, schools, and hospitals.

The more challenging we make it to build, the more unaffordable it is to live. San Francisco is the most expensive city in the world to build, coming in at $440 per square foot. San Francisco (rightfully so) received a lot of criticism for their treatment of the homeless population during the Asia-Pacific Economic Cooperation. They tried to sweep away the problems before guests arrived. 

But these problems have much deeper roots. The home price to household income ratio has never been more expensive. What does this mean?

It means that it’s become more and more expensive to live. The cost of housing has increased to such a point that living a normal life has become unattainable to all but a select few. More and more people who are evicted due to a sudden increase in rental prices are left to fend for themselves. Having a place to call home is just the first step in making the world a better place. 

With all these problems, there is huge potential for growth and change. The whole basis for starting a startup is creating new technologies that solve a real problem. Investing in these companies means there are opportunities to be a part of impactful change while reaching for venture capital multiples. 

So what’s the hold-up? Why hasn’t there been a seismic change in the construction industry? Simply put, construction isn’t sexy. 

How do we make it sexy?

We Need a Construction Champion

The construction industry needs its own Elon Musk.

Regardless of how you might feel about Elon Musk, he’s accelerated the electric car and space industry by decades through Tesla and SpaceX. Auto manufacturers from Ford to Hyundai to Toyota have poured money and engineers to accelerate their electric car creations just for a chance to compete. With Tesla’s sleek design and Musk’s radical presence, electric cars were suddenly cool. Companies like Rivian have followed in Tesla’s footsteps, adding their flair to the market that Tesla has captivated. 

Other industries have also seen similar shifts after a figurehead has emerged. Take Palmer Luckey, the founder of Oculus (which sold to Facebook for $2 billion), and Anduril, a national defense contractor worth about $10 billion. He’s flipped the script with Anduril by changing the incentives for defense contractors. The incumbents, Lockheed Martin, Boeing, General Dynamics, Raytheon, and Northrop Grumman have all been forced to innovate and accelerate their progress at risk of being caught swimming naked.

More importantly, Luckey has made working in national defense sexy. 

How so? He’s 30, wears Hawaiian t-shirts and flip-flops, is a big cosplayer, and wins billion-dollar contracts from the gray-haired suits in Washington. 

Consciously aware of his persona, he’s fought back against the traditional notion that he should dress in a suit and be serious all the time. He knows that he can inspire other young, smart, and energetic people to start their own defense companies.

Both electric cars and national defense were unsexy endeavors until they had a champion leading the way. If these industries can be transformed by a champion, why can’t construction? 

What would a champion in construction look like? Maybe they’ve already been successful in another industry. For example, Musk had Paypal, Luckey had Oculus. Perhaps, after being successful in another industry, they pivot to construction. He, or she, would most likely be a tenacious engineer, who would be able to tackle problems unbothered by other people’s opinions. With an obsession with solving inefficiencies in the world, the construction industry would be a playground to them. 

By bringing in a charismatic champion, the construction industry could attract investment and talent that would otherwise go elsewhere. The investment and talent would help accelerate the rate of building around the world.

By accelerating the rate of building, we can solve what should be a  simple problem – housing. Bringing down housing costs is only the first step in building an equitable world. With it, we can take on more and more challenges that plague our society. 

Putting the Awe back in Awesome

Construction is awesome. Whenever I stand back in awe of a skyscraper, I’m reminded that there are challenges that we’ve tackled before and we can tackle again. Building something great is a part of every child’s dream, but somewhere along the way, we lose that dream. 

Regaining that dream and solving the hard problems in construction demands time, money, and grueling work. But if we can treat construction with a childlike wonder and excitement, we’ll do just fine. 

Thank you to Steven Foster, Ann Hagedorn, Ethan Keshishian, CansaFis Foote, Mohammad Khan, Gianfranco Filce, John Laing, Tommy Zhao, Cissy Hu, Oliver Zou, Rebecca Isjwara, Michelle Varghese, Sandra Yvonne, and Maymie Chan for providing feedback on this piece.