This is not your typical software-as-a-service (SaaS) startup story: Garrett Burke, an occupational safety professional at Harvard University, wanted a tool to qualify the university’s contractors and vendors for safety and risk mitigation — so he designed an in-house SaaS package to do just that and more. It became so popular, Harvard spun the software off as a business that’s now opening its second office in Treasure Valley.
As ConstructSecure CEO Austin Merritt related to Idaho Business Review: “ConstructSecure started at Harvard in 2006 and then spun out in 2008…after they built the tool, the general contractors who were doing work for Harvard said, ‘This tool is great — there’s nothing else like it out there. Can we license it from the university?’ And the university said, ‘Sure!’ After this happened several times, the university realized it needed to operate as a standalone business, so it spun it off.”
Harvard University initially gave ConstructSecure its start. For the first decade, company president Burke bootstrapped the venture. Then in 2021, Summit Partners came on board and brought in as CEO entrepreneur Merritt with his successful experience in promoting software.
ConstructSecure recently announced a $96 million growth investment on Jan. 24 by Summit Partners of Boston, an investment firm already known for its support of Idaho businesses like Boise’s ProClarity Corporation, which was acquired by Microsoft; NightHawk Radiology Services, once based in Coeur d’Alene, which merged with vRad; and TSheets in Eagle, which was bought by Intuit in 2017.
ConstructSecure will open an office in Meridian just off Interstate 84 on the south side of the Eagle Road interchange. In an email, the firm confirmed that the planned opening has an estimated date of April 1.
“We’re planning to do a lot of hiring there this year,” Merritt remarked. “Primarily engineering roles — so software engineers, principal engineers, DevOps, all of that. We’ve got a good amount of space for a big team there.”
The firm plans to hire 12 engineers this year followed by 12 more next year. “It’s been really exciting to see the whole greater Boise area, the whole Treasure Valley, rise to the ranks as a great tech hub in the United States. It became clear that the talent in Boise is awesome, and it’s totally the ideal location for a second headquarters.”
ConstructSecure markets its software as not just pre-qualification but as “partner elevation.” Merritt explained the concept has its roots in Harvard’s vision for the tool.
“Harvard does a billion (dollars) a year in capital projects,” Merritt stated. “From a standpoint of teaching and research and education, they wanted a tool that would not just help them mitigate risk, but actually help their contracting partners improve and do better work and run better businesses. They went to market to look for software that did that, and they couldn’t find anything. There are basic pre-qualification tools that help you just look at compliance of subcontractors, but those are really just looking at a few basic lagging indicators of success.”
He continued, “Harvard wanted something that would help to understand strengths and weaknesses of contracting partners — and then help put in place corrective action plans, performance improvements — plans that would actually help those companies improve. (Harvard) wanted something that went far beyond that, and actually elevated the performance of (its) contractors.”
As Harvard’s associate director of occupational safety, Burke built that tool which “was radically different from pre-qualification.” And that is how the partner elevation innovation was created.
Merritt laid out an example of how partner elevation works with the ConstructSecure software: “In performing assessments of the financial aspects of contracting partners, we’re really trying to answer the question: Do they have the financial capacity to do this job? It’s key that companies answer that, because if you don’t, then your contracting partners can be at risk of default, which creates massive problems for capital projects.”
Merritt explained ConstructSecure’s tool asks the contracting partners to upload their last three years of financials.
“Our software will read through it and pull out all the key metrics that provide (an assessment of) how much capacity they have for additional work,” Merritt said. Then it’s all verified on the back end by a CPA.
“When you look at (the data) holistically, you can see what a (contractor) has in progress right now and how much capacity they really have,” Merrit continued. “So if you’re trying to put out a $5 million job, you can see if they can handle it. And if they can’t, then you can put corrective actions in place. Those can be things like paying them every two weeks instead of once a month so they get the cash flow faster, if they’re really small; or giving them a portion of the contract and they get someone else to do the rest.”
The firm’s client base suggests that ConstructSecure may be onto something worthwhile, as Merritt commented: “We have evolved and expanded our solutions from our roots as an internal risk management tool at Harvard University to a fully-integrated partner elevation platform used by some of the world’s most admired organizations, including Skanska, Merck, Bond Brothers and many others.”