The construction industry has thrived over the past few centuries and has been a cornerstone of economic growth — driving the development of sectors such as transportation, manufacturing, communication, energy, education etc. It is, however, a sector that hasn’t embraced automation and sustainable green practices at a pace that one would expect.

The highly fragmented nature of the industry has pushed most stakeholders to be largely risk averse over the past few decades. This has led to the speed of adoption of innovative technologies and digitization being lower than nearly any other major industry.

A large market that is falling behind

Construction is globally a $13.5T industry, but is low-margin, highly-regulated and high-maintenance. Even a slight delay in building timelines can result in fines, heavy consumer dissatisfaction and defaulted loans for the builder.

The Indian construction industry is valued at over $600B today and is expected to be over $1T in 2025. It contributes to 11% of the country’s GDP and employs 33 million workers.

With a lack of competition on a global scale, the construction sector has struggled to innovate, resulting in a decline in productivity by 7%, between 1997–2021.

The industry hasn’t been doing well on the environment front either. The buildings and construction industry represented around 37% of global operational energy and process-related CO2 emissions, and 20% of all industrial wastage. Crucially, it is one of the sectors that is not on track to achieve decarbonization by 2050, with the gap between actual performance and the expected decarbonization pathway widening

More recently, the industry is struggling to gather a skilled workforce. While this is a global trend, industry stakeholders in India are seeing this as a pressing problem, especially in the tier-1 cities. There was a reverse migration of labourers post-pandemic and the industry has not yet recovered from it. As access to technology and education among Indians improves, builders are finding it extremely challenging to bring in skilled construction labour, who are seeing more lucrative career alternatives. General Contractors only expect the problem to get worse in the years to come.

All these factors make it an industry that is ripe for disruption — both in India and globally. Automation, Robotics, Building Management systems, market places, lifecycle management platforms are all expected to contribute to the transformation of this sector.

3D Printing in Construction

Construction 3D Printing is at the juncture of multiple technologies and can well be the solution to a number of these problems that plague the industry today. While still early in its maturity curve, it has moved from the realms of academia and is seeing adoption by the mainstream construction industry.

Construction 3D printing is a process that uses 3D printers to create or assemble buildings or parts of buildings. The additive manufacturing process allows for the construction of complex geometric structures with low wastage, reduced human labour requirements and at higher speeds. These benefits can be hugely significant in an industry that is struggling on all these fronts.

On the technology side, the printers themselves can be largely classified into a gantry and a robotic arm, both of which have an extrusion system for the concrete to be laid out. The gantry system is more suited for large structures, and is easier to operate, but is more expensive than the robotic arm, which is more suited for complex geometries and for smaller structures and objects.

Further, we see companies 3D printing structures either on-site, i.e. the place of final construction, or off-site — where structures are built indoors in a different location, transported and assembled at the site of construction. Our learnings have led us to understand that parts of houses such as stairs, walls etc are better off built off-site, where mass housing requirements are best done using on-site printers.

Technology challenges

Because of the development of adjacent technologies, the printer hardware and the design software are not considered to be huge engineering challenges today. The compatibility between the two, however, is critical.

In our conversations with stakeholders, we learnt that the tricky bit is getting the material composition right.

The material contributes to over 50% of the cost of a 3D printed structure. In an industry that conforms tightly to standards and building codes, any new material should match or outperform all properties of modern day cement. All construction 3D printing startups today hold the material mix as something proprietary. Regular cement is reinforced with additives to make it extrudable from a printer, which adds to the cost, sometimes upto 3X — 5X that of conventional cement.

There is a fair bit of process engineering required to tune the extruder to optimize for the flowabaility, buildability, binding time etc of the material based on the external weather conditions.

We must remember that today, the entire house cannot be 3D printed. Load bearing and roof structures are still not under the purview of C3DP. Windows, doors, electrical and plumbing lines are still done in the conventional manner. Our learnings have been that ‌ close to 30–40% of the cost of a house and about 50% of the house in itself can currently be carried out by 3D printing.

Other limitations of C3DP technology include an inability to build structures consistently at scale beyond 12–15m in height, and hence limiting it to a 3 storied building at best. C3DP also works well in markets and use cases where labour is scarce and expensive. In India, while labour is cheap, it is quickly becoming scarce, hence pushing builders to adopt new technologies.

The cost of a 3D printed house can be anywhere from 1.3X to 5X the cost of a traditionally constructed house.

Global and India Construction 3D printing landscape

We found close to 30 companies (global and India) who have been funded in this space (as per Traxcn). ICON, based out of the US, is the global leader in this space, having raised over $450M in capital. Mighty Buildings, also based out of the US, has raised over $100M. In India, Tvasta, MiCoB and Kelvin6K are a few startups working in this space. Below is a non-exhaustive view of the landscape

Who will pay for this?

This leads us to the big question — who is interested in this technology? Is it a fancy for the rich, or can it truly lead the way for affordable housing?

In our conversations with builders in India, we understood that construction 3D printing technology is one of the high potential candidates for the future of construction. In India, C3DP still has a long way to go. Current limitations of the technology — the inability to construct tall structures beyond a few stories, lack of smooth finishing and structures being more expensive than traditional houses (at least 1.3X — 5X more) are preventing its large scale adoption.

In India, builders are still experimenting with small structures such as the post office built by L&T in Bangalore in 2023 and the shelter built by Godrej Construction in 2022. Their intent seems to be to build small, less risky structures and understand the technology before showcasing it to customers. India is also a cost sensitive market, hence, new technologies are more likely to penetrate more premium segments such as villas and hotel chains, achieve scale and then penetrate the more affordable segments

Where cost is of lesser importance, all stakeholders that we have spoken to have highlighted the relevance of this technology. In disaster relief management, where speed of execution becomes critical, C3DP can play a crucial role in printing houses at a rapid pace.

In India, we also see the defense, specifically the Army, employing C3DP to construct bunkers for soldiers, especially in areas that are less accessible and ideal for soldiers to build structures. The US Department of Defense has also worked with ICON to 3D print structures for their use.

In a market that is quite nascent, players would have to do the entire stack themselves i.e. innovate on the material, build the printer, build the houses and sell it themselves, or partner with a general contractor (GC) who would handle the building project. There are also startups who work on 3D-printing-as-a-service — designing complex 3D printed structures on demand , and hiring out equipment and skilled workers to work on projects. A clear business model playbook is yet to emerge in this space.

What we believe is key

The demand for housing is going up, marked by tailwinds such as population growth — (expected to touch 8.5 billion by 2030), shrinking family sizes (hence more houses required), global urbanization, and an increasing affordability in developing countries. For 3D Printing to be a technology solving for this global demand, successful companies in this space should overcome a number of challenges -

• Have a strong understanding of the materials — getting the material mix right is the key technological challenge and it is imperative that startups understand the composition of materials and a consistent way of manufacturing it.
• Inroads into the construction industry — Being a highly fragmented industry, we believe that having one co-founder who understands how ‌this sector operates is a strong differentiator.
• Founders should start thinking about GTM from the early stages and identify and execute in markets where their technology can be proven and scaled. At the same time, since the large scale housing use case might be 3–4 years away, establishing partnerships with multiple General Contractors (GCs) and being prepared to execute when the market opens up will be advantageous for the startups.
• In densely populated urban environments, solving for technology to build beyond 3 storied structures will be key. Until then, widespread adoption would be difficult.
• In a cost sensitive market such as India, bringing costs down to about 1x -1.5x ‌ the cost of traditional construction would be key for widespread consumer adoption.
• With building codes varying across geographies, it would be crucial to have favourable regulations that permit for scaling.

Construction 3D printing is a technology that holds a lot of promise in a large sector that is awaiting disruption. If you are building something exciting in this space, please do write to us at info@specialeinvest.com or to me directly at sunil.cavale@specialeinvest.com

This piece would not have been possible if not for the work put in by my colleague Prajwal P Rao.

We at Speciale Invest believe in supporting breakthrough technologies that have the potential to solve pressing global problems.

As early stage investors, we like to get our hands dirty early on and support founders in their zero to one journey with patient capital, business development opportunities and hiring. We enjoy and thrive on the risk that comes with backing deep-tech startups at the pre-product stage and help through product-market fit, early customers and scale-up.

To know more about Speciale’s investments in disruptive technologies, please check our portfolio