According to Business Insider, Digs has raised $19.1 million in total seed funding, including a recently closed $5 million round led by SPLY Capital with participation from Lanthorne Homes. The Vancouver, Washington-based startup came out of stealth in 2023 and previously raised two $7 million rounds. Digs uses AI to organize building documents and generate “digital twins” – interactive 3D models that help homeowners with upkeep after construction. The company has nearly 10,000 homes using its platform and expects to be cash flow positive by the end of next year. Digs offers two main products: DigsCanvas for preconstruction collaboration and DigsCare for warranty management, with revenue coming from selling seats to builders who can then invite contractors and homeowners as free collaborators.
The construction tech gold rush
Here’s the thing – we’re seeing a massive wave of startups trying to digitize the construction industry, and honestly, most of them fail. Construction is notoriously resistant to technology adoption. The workflows are entrenched, the margins are tight, and let’s be real – most builders would rather pick up a hammer than learn new software.
But Digs seems to be taking a smarter approach by focusing on documentation and collaboration. Anyone who’s built or renovated a home knows the absolute nightmare of managing permits, blueprints, and warranty documents. It’s basically a part-time job keeping track of everything. If they can actually solve that pain point, they might have something.
The revenue model looks shaky
Now, I’m skeptical about their planned expansion into selling products to homeowners. They mention both the company and builders would take a cut of purchases, plus they’re exploring subscription services for maintenance. That sounds like they’re trying to be everything to everyone.
Builders might not love the idea of their clients getting upsold products through a platform they’re paying for. And homeowners? They’re already spending hundreds of thousands on construction – will they really want another subscription service? It feels like they’re spreading themselves too thin when they should be dominating their core documentation business first.
The digital twin promise
The digital twin concept is genuinely interesting though. Think about it – you buy a house and basically get handed a set of keys and maybe some appliance manuals if you’re lucky. Having an interactive 3D model that shows you where every pipe, wire, and beam is located? That could be incredibly valuable for maintenance and future renovations.
But creating accurate digital twins isn’t easy. The construction industry already struggles with industrial panel PCs and basic technology adoption – getting them to consistently input quality data for AI to work with is a huge challenge. If the underlying data is garbage, the digital twin will be too.
Everyone’s jumping in
Digs isn’t alone in this space – Business Insider mentions Trunk Tools and Scalera as competitors focusing on different parts of the construction process. That tells me we’re probably heading toward a consolidation phase where only the strongest players survive.
With 28 employees and nearly 10,000 homes, they’ve got some traction. But construction is a massive industry, and scaling requires convincing thousands of individual builders and contractors to change how they work. That’s a tough sell, even with $19 million in funding. They’ll need every dollar of that new funding for their sales team expansion.
