Wednesday, December 1, 2021 11:26 am

What does Katerra’s demise mean for the contech and modular industries?

By Sebastian Obando | Construction Dive

When former CEO and co-founder Michael Marks left Katerra in May 2020, the company that aimed to revolutionize the construction industry had reached the beginning of its end.

What followed was a meteoric fall by one of the most promising construction startups of all time. Katerra blew through more than $2 billion of investor money, a majority from Japanese conglomerate SoftBank. Other financial supporters included Soros Fund Management and the Canada Pension Plan Investment Board.

Just 13 months after the company replaced Marks with COO Paal Kibsgaard, Katerra filed for Chapter 11 bankruptcy. At the end of this summer, Katerra sold off its assets in Tracy, California, for $21.25 million and its factory in Spokane, Washington, for $50 million.

Katerra’s journey from unicorn to bankruptcy:

2015
Founded by Michael Marks and Fritz Wolff.

April 2017
Reaches a $1 billion valuation.

November 2017
Listed among LinkedIn’s top startup companies.

January 2018
Raises $865 million in a new round of financing led by Softbank’s Vision Fund.

January 2019
Softbank’s Vision Fund leads a $700 million round of funding, driving valuation to $4 billion.

November 2019
Fritz Wolff, one of the co-founders and board members, leaves amid layoffs and abandoned projects.

December 2019
Lays off 200 workers and shuts down its Phoenix modular building facility. Manufacturing operations moved to Tracy, California, where costs are lower and work is highly automated.

January 2020
Signs a $650 million contract with Saudi Arabia to build 8,000 homes.

April 2020
COVID-19 spreads, delays affect its San Marcos, Texas, project, as well as other projects in Washington state and New Jersey.

May 2020
As part of an additional $200 million raise from SoftBank, COO Paal Kibsgaard takes over for Michael Marks as CEO.

June 2020
Lays off an additional 7% of its staff, mostly in the U.S.

March 2021
Greensill Capital, a SoftBank-backed lender, files for insolvency.

June 2021
Katerra files for bankruptcy protection.

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