Funding will enable BuildDirect to further disrupt building products industry with e-commerce
VANCOUVER, BC, June 25, 2012: BuildDirect.com, North America’s largest online destination for heavy weight building materials, announced today a $16 million investment from OMERS Ventures, the venture capital investment arm of OMERS, one of Canada's largest pension funds.
The company will use the investment to accelerate growth, expand its team and provide a more extensive product line for customers including professional trades, subcontractors and do-it-yourselfers.
Capitalizing On Untapped Online Potential
BuildDirect taps into a massive market previously unsuited to e-commerce by solving the complexities of a fragmented, inefficient supply chain, as well as the industry problem of shipping heavy, hard to handle goods cost-effectively.
“BuildDirect is a next generation building supplies company, using e-commerce to create what we see as the future of retail. Their advanced technology platform allows them to reduce complexities, provide the best prices and best quality materials to customers, and offers unprecedented data access for supplier forecasting,” said Derek Smyth, Managing Director of OMERS Ventures. “We’re attracted to the opportunity BuildDirect has created to capitalize on the untapped potential of the e-commerce market, as well as the future growth of both the building supply market and adjacent categories.”
As a lifecycle investor with significant assets, OMERS Ventures has the ability to be a long-term partner to its investee companies.
Poised For Rapid Growth
Having not only survived, but grown through significant downturns in the US building and renovation market, BuildDirect is leveraging its data-driven platform to profit from an industry that has lagged in e-commerce adoption: the flooring market in the U.S. alone is US$17 billion annually and the broader building product market is US$492 billion. (Source: Catalina Research and US Census Bureau, Lowe’s 10K, 2010)
“It was extremely important for us to find an investment partner aligned with our company values,” said Jeff Booth, President and CEO of BuildDirect. “We’re a technology company that uses data to create long term, win-win relationships that enable everyone in our ecosystem to succeed. With their experience as business operators, the principals at OMERS understand our strong commitment to building a world-class company and reinventing an industry that is ripe for disruption.”
Data Driven Platform Creates Defensible Market Position
BuildDirect is a pure play e-commerce company - focusing solely on the heavy building materials industry, and selling exclusively online. The company has simplified the supply chain and spent years creating an entirely new paradigm for the sale of building materials. The company’s predictive data-driven platform:
- Provides manufacturers a 10x improvement in operations and marketing efficiency
- Accurately predicts which products will be successful
- Allows shippers to bid in real-time and give customers the lowest possible freight costs
- Has attracted a critical mass of users providing accurate demand data as well as high search engine rankings for the thousands of products BuildDirect represents.
This entire ecosystem allows BuildDirect to offer its customers up to 80% cost savings and enjoy a repeat customer rate as high as 70%.
BuildDirect has seen its number of customers almost double in the last 12 months. “The momentum we’re seeing with new and repeat customers will carry us way past last year’s performance,” added CEO Booth. “The OMERS investment is going to help catapult us into a huge growth and expansion stage.”
Founded in 1999, BuildDirect.com is an e-commerce provider completely disrupting the retail building products industry by bridging the gap between the manufacturer and end user. By simplifying the supply chain, solving a heavy freight shipping issue that plagued the industry and creating a proprietary data-driven platform that benefits manufacturers, partners and customers alike, BuildDirect customers ultimately enjoy up to 80% cost savings. The company is headquartered in Vancouver, B.C, with eight warehouse locations in the US and hundreds of thousands of satisfied customers. For more information visit www.builddirect.com
About OMERS Ventures
OMERS Ventures (Twitter: @OMERSVentures) is the venture capital investment arm of OMERS, one of Canada's largest pension funds with $55.1 billion in net assets. It is an initiative of OMERS Strategic Investments (OSI), an investment entity with a mandate to build long-term strategic relationships with like-minded partners. As both an institutional angel investor and a later-stage investor, OMERS Ventures is looking for successful companies with significant growth potential and market opportunities. We are seeking like-minded partners with a shared vision of building a vibrant and successful knowledge economy. For more information please visit www.omersventures.com.
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