How Do Construction Firms Identify and Vet New Startups?
A framework for identifying, shortlisting, and piloting new solutions.
Originally published by Bhragan P. on Last Week in ConTech on Mar 13, 2025
Across the industry, new technology solutions are constantly being vetted and piloted by construction companies.
The challenge for startups is that this process varies from company to company due to their needs, available resourcing and how the vetting process was set up. It makes standardization of sales and implementation challenging.
Having spent over a dozen years in construction, both managing the adoption pathway at Suffolk and now as an independent Construction Technology consultant, I've seen there are a set of core principles or best practices for how contractors should engage with startups and adopt new solutions.
This process involves careful consideration and input from a wide range of internal stakeholders to ensure objections are preemptively addressed and the solution aligns with the needs of the field.
In this article, I'll be breaking down how we move from problem statements to shortlisting, vetting and piloting new solutions.
The goal here is to help construction companies understand how to identify and adopt new solutions and to help ConTech startups understand how this works behind the scenes.
Before we jump into the adoption process, lets first examine how innovation programs are set up and how they identify their focus areas.
Contents
- Scope of an Innovation Program
- How to identify and vet solutions
- Step 1: Understand the requirements
- Step 2: Create a shortlist of solutions
- Check the internal App Store
- Complete a Market Scan
- Do we need a custom build?
- Considerations for AI startups
- Step 3: Review shortlisted solutions
- Sandbox Testing
- A note on real life!
Reading time: 9 mins
Scope of an Innovation Program
When a construction company sets up their innovation program, the size of the firm will dictate how many resources will be allocated and what the solution vetting process will look like.
A small firm will be able to steer solutions faster while a larger firm, which has more internal stakeholders, can have a more time consuming and cumbersome process leading to longer sales cycles for startups.
For this article, we will examine the vetting process through the lens of a large organization, as it is the most complex and contains elements that apply to all construction companies. In this case, the large organization will already have business departments established which the innovation team must engage with and align their activities to.
The vision and goal of the innovation program should be based on achieving the organization's strategic priorities. These strategic priorities should be based on stakeholder feedback and developed each year by the c-suite using a goal setting process and be funneled to the business departments.
Once these are defined, the innovation team will strategically pull the listed priorities from across the organization and do a matching exercise with new technologies they are seeing.
The scope of the priorities that the innovation program is servicing is dependent on who they support. They can support either:
Only Operations (the field)
Innovation for operations in construction is complex as you are dealing with differing:
- Project requirements
- Owner requirements
This creates a guaranteed scenario of variability as you don't know if what you are building today will be built the same way as your last project. It means that the innovation landscape for operations is going to have a wider breadth of solutions to explore and this characteristic is why the operations team usually has its own focused innovation team.
All business functions (including back office such as HR, accounting, marketing)
Across the business, every department desires to improve the way in which they work. Back office business functions such as HR and Accounting usually know what they need to upgrade their function. This is unlike the field as their role requirements do not change significantly between projects. It means they may be able to self manage their innovation process with support from the IT department.
Depending on the above focus, the innovation team is able to filter the strategic priority list helping to identify where to focus their short to medium term innovation efforts.
The priority list is a mechanism to prevent or de-risk the business from taking on too much work at once.
Now you have identified problems and created a priority list, what's next?
How to identify and vet solutions
At this stage, the business has an innovation team setup, scope identified and priority list established.
From this priority list, the innovation team will identify the highest priority focus area and undertake an evaluation to identify how to improve processes.
This involves talking to the affected team(s) to understand the root cause of the problems they face.
For example, if the problem is a rise in the number of safety incidents or 'close calls' between equipment operators and workers on sites, the solution may not require tech and involve additional training or the implementation of a culture change program.
However, if it is identified that the problem is critical and a technology solution is required, then the innovation team will propose technology solutions which meet the team's use case such as a solution to automatically power off mobile equipment when a worker enters the 'Equipment Exclusion Zone.'
Let's break down the process of how the team identifies and vets new tech solutions.
Step 1: Understand the requirements
The first step is to create a checklist to identify the key requirements the solution needs. This involves talking to key stakeholders including:
- The project teams / site personnel facing the challenge
- IT
- Legal
- Anyone else affected
For each one write down their minimum requirements. Additionally, for the project team only, ask for their wishlist items of what they would love to see.
As you are early on in the process, we don't know yet what the market is offering and the wishlist items might be readily available from a provider, impacting the final buying decision.
Some common examples of checklist requirements might be:
- IT requiring single sign on or SOC 2.0 certification
- Legal may want the contract to stipulate who owns the data
This process is valuable as IT and Legal, which typically aren't involved in the evaluation process are aligned with concerns addressed early. It helps to prevent last minute vetoes by preemptively addressing issues and concerns.
Additionally, by engaging with key stakeholders, each feels like their requirements were heard, helping to create internal advocacy for the final chosen solutions improving the chances of successful adoption.
Step 2: Create a shortlist of solutions
Expanding software search process
Now that the requirements have been clearly articulated, the innovation team is to complete a detailed review process to identify potential solutions.
Check the internal App Store
The first step is to determine if there is an off the shelf product which meets the requirements.
Most large organizations have an internal app store or software marketplace where staff can easily download approved applications like Revit or ProjectWise. These apps might be dated, or not targeted enough, and in fact the cause of the issue.
Nonetheless, these must be checked to determine if there is a readily available, supplementary feature set currently not being used, which could meet the checklist requirements.
Complete a Market Scan
If a solution is not readily available on the App Store, the next step is to scan the market for potential solutions.
These solutions could be sourced from an online search query, asking within the team's wider network or knowledge of the industry, from the affected project team's awareness of solutions, or from the innovation team's database of potential solutions.
From this, a list of startups which could meet the checklist requirements is established.
Do we need a custom build?
If the results of the market scan are not fruitful, the team may need to consider if they need to build a custom or unique software. This can also occur if the company's tech stack is very unique and not easy for a new solution to integrate with.
An intermediary and cheaper measure to a full custom build, is to identify if a shortlisted solution could integrate with the company's tech stack via a custom plugin.
Considerations for AI startups
When evaluating AI solutions, there are additional considerations the innovation team needs to consider. Primarily, they want to identify if the solutions shortlisted from the market scan are a:
- True Innovation
A startup developing new or specialized AI capabilities for construction specific challenges which are not readily available on the market.
e.g. an AI which reads and contextually understands how construction drawing sets relate to each other. - Wrapper
A startup adding basic AI functionality to existing solutions to meet a construction specific use case.
e.g a solution which ingests photos and notes and uses an existing LLM to create a formatted site report.
This is important to understand as if the solution is a wrapper, a consideration may be, can my inhouse developer team build it and deploy it throughout the company at lower cost?
To identify if a solution is a True Innovation or a Wrapper, we can follow Nate Fuller's AI framework and ask:
1. What can your AI product do that ChatGPT can't?
2. What is the AI expertise of executives at your company?
3. How focused is your AI on construction problems exclusively?
4. How is my data handled and treated?
From this, the innovation team can gauge the type of AI company and if the cost is justified.
When making this cost estimation as it relates to AI Wrappers vs their internal dev team, the innovation team must also consider:
- Opportunity Cost
Your development team's time could be spent on other higher value strategic projects. - Ongoing Costs
Maintaining and improving the solution requires ongoing resources. - Implementation Costs
Training the team and scaling the solution across the organization requires significant effort.
Startups which deliver AI Wrapper solutions address the above by providing further value such as:
- Immediate implementation (no waiting for internal development)
- Dedicated training and support for your workforce
- Continuous product improvements and feature updates
These must be considered when evaluating the final cost of the AI solution and creating the shortlist.
Step 3: Review shortlisted solutions
Now that the comprehensive internal and external market scan is complete, the innovation team may have identified over 10 potential solutions which meet their checklist requirements.
The next step is for the innovation team to go through the shortlisted solutions to identify which to pilot.
Their aim is to undertake a deeper analysis of the solutions to evaluate alignment to the project team's needs. With this information they will prioritize the solutions and identify the top 3 or so they wish to learn more about or trial.
For this process, the team will identify an internal Subject Matter Expert (SME) to undertake the analysis. This could be:
- An innovation team member who has had prior direct experience of the problem (i.e. worked in the field).
- A member of the Project Team who is facing the problem (ie. the end user).
Solution identification and vetting process
This person will use the checklist and undertake a desktop study (e.g. review website and public materials) of each identified startup. For solutions with promise, the innovation team and the SME will connect with the startup, reviewing pricing and undertaking a demo to ensure it can meet the checklist requirements.
Armed with this information, the SME will select up to around three solutions which are to be tested. In some cases, fewer solutions may be evaluated due to constraining factors such as urgency of site conditions.
Sandbox Testing
Once the top solutions have been selected, a sandbox environment should ideally be set up for initial testing. This is an environment where we can place dummy / test data and it won't affect live or operational data.
It will be set up for each of the selected solutions so that it can be safely tested by end users.
The testing process will be managed by the innovation team and involves:
1. Identify a list of end users to test the solutions who:
- Have knowledge of the processes to be tested
- Have a willingness and interest to engage with the tech solutions
(these could be internal change agents)
2. Provide the testing scope to the end users
This includes the core process or crucial workflows defined in the checklist requirements.
- For example, for a safety solution, an end user may need to ensure that they can log a safety observation and the Project Manager is notified.
3. Provide the end user with context
This includes a user story of what the solution is, what it looks like and how it should work:
- We are looking to upgrade our safety system.
- Here is the solution we are evaluating.
- Trial this solution for 1 hour this week and next week we will provide an alternative.
4. Provide a survey to each participant to receive their evaluations.
The innovation team will then aggregate the evaluations from end users and rerank the solutions. The highest ranked solution is to be piloted on a live project (this live piloting process will be examined in another article).
[pullout quote] - This vetting step is key in ensuring that the field is aligned with the solution you offer prior to live piloting and to prevent a failure of adoption.
A note on real life!
The process described above is the best practice for vetting and reviewing new solutions. In reality however, this process is often not followed. The reason why is that some projects are desperate for a solution, need it immediately and can't wait till it becomes a departmental priority.
An example is if there is a focus on safety but a critical issue arises where daily reports are being completed by hand impacting reporting and decision making. These cases don't have time to complete a thorough stakeholder engagement and market scan process. In many urgent cases, teams end up undertaking their own 'Surprise Pilots', as I like to call them, resulting in a new innovation scenario that has unique benefits as well as consequences.
The innovation team will be required to assist with 'surprise' pilots, choosing which parts of the overall adoption process can be applied given the limited timeframe.
These issues can be mitigated by ensuring that the innovation team is in regular contact with project team members. It allows them to preempt challenges and be incorporated into the solution identification process early. The more time available, the more thorough the solution identification and evaluation process is, maximizing the chances of adoption success.
Successfully identifying and vetting new technology solutions in construction is a structured yet dynamic process. While best practices involve stakeholder alignment, market scans and sandbox testing, the reality is that urgency often drives innovation outside formal channels. By maintaining strong communication between innovation teams and project teams, construction firms can better anticipate challenges and proactively identify solutions before they become urgent.
For ConTech startups, understanding this process is crucial. Startups that align with innovation priorities, engage key stakeholders early, and clearly demonstrate real-world value have the best chance of securing and succeeding in pilots.
At the end of the day, the goal is the same for both startups and construction firms: finding the right technology solutions that solve real problems and drive meaningful improvements across projects and business functions.
Erin Khan is an established AEC technology leader, with over a decade of combined experience in construction operations, data and process analysis, and software implementation. Founding Erin Khan Consulting in 2023, she currently provides technology and innovation services to both contractors and construction technology startups.
Prior to founding EKC, Erin served as the National Director of Construction Solutions for Suffolk Construction, overseeing national technology and innovation operations. Erin holds a B.S. in Civil Engineering from USC, a certificate in Business Analytics from The Wharton School, and is EIT, LEED AP BD+C, and OSHA-10 certified.