Danish construction technology firm, Optimise International, has launched a “pay-as-you-go” SaaS project controls application, Kapio Cloud.
For less than the price of a cup of coffee, Copenhagen, Denmark-based construction technology developer, Optimise International, has introduced a cloud-based “pay-as-you-go” project controls application, Kapio Cloud, offered at a daily cost per user of €1.99. And contract commitments can be as short as 24 hours.
Software licensing evolution
This marks a further shift in how software can be licensed and used. Conventional software was typically purchased and installed on the user’s hardware, with the purchaser paying a one-off perpetual license fee to the software provider to use the software, usually calculated according to how many ‘users’ or ‘seats’ were needed. The license then allowed unfettered use of the software for as long as it was needed. An additional software maintenance agreement might also be agreed whereby the vendor provided helpdesk support, bug fixes and routine updates to the software.
The advent of Software-as-a-Service around 20 years ago began to change this model. Instead of making an upfront investment in the software, purchasers could pay, say, a monthly fee to use the software (quarterly or annual subscription plans are other common options). Broadly, two licensing approaches were applied. The SaaS solution could either be: licensed ‘per user per month‘ (an adaptation of the conventional on-premise ‘per seat’ models), or licensed ‘per-project‘. This meant no restriction on the number of users or volume of usage, for the duration of the project, with the price negotiated to suit the project, its team and their information requirements.
The second model was common in the UK SaaS construction collaboration market, where SaaS solutions were typically deployed to support multi-company teams working on single construction projects. The subscription might be paid by the client, by a main contractor or a lead consultant, with end-user licences granted ‘free’ to all authorised partners working on the project.
As the AEC SaaS market matured, clients and other businesses began to standardise on their chosen SaaS platforms, and ‘enterprise licenses‘ could be negotiated. For example, a contractor might decide that all of its clients’ projects might be managed on a single platform, and would negotiate a deal with the SaaS vendor so that its software could be used on multiple projects, usually for a duration of, say, three, four or five years. Such deals meant the software vendor secured predictable subscription revenues for several years, while the purchaser spread the cost over the same period.
Kapio opts for Pay-As-You-Go
According to a BIMplus report, Kapio feels ‘per-project’ licensing can be “prohibitive” for smaller, specialist trades, meaning they miss out on the benefits of granular data collection, transparency and slower information flows – increasing project management risk, cutting productivity and reducing profitability.
Kapio Cloud challenges this model. Making use of cloud technology and with high levels of security encryption, construction teams can access Kapio Cloud for a daily charge of €1.99 (£1.72) per user. Being able to use the reporting and document control functionality on an unlimited number of projects adds the opportunity for further cost savings to both large and small firms. CEO Steve Arnold (right) says:
“The software enables construction teams to make the transformation to digital without costly upfront fees and additional support charges – these are all included in our daily subscription price. The contract commitment can be as little as 24 hours.”
As with many SaaS startups (see Aphex, PCS and HammerTech, for example), Kapio was developed out of frustration with laborious, inefficient construction processes. Company co-founders Philip Wright, a contracts manager, and Kasper Lorenzen (right), a site manager, were working on a large public transport project for a northern European city in 2015/16.
The project consisted of 21 sites, with 21 transit stations under construction by multi-lingual teams. This led to language issues when filling out reports, while the contract language was in English, and maintaining accurate communication between teams was an issue. Moreover, daily reports required for quality, safety, progress, measurement, compliance, etc, were reliant upon paper-based processes, with data summarised in multiple formats (Word, Excel, PDF), and prone to error from re-keying of data. Inputting data this way was also time-consuming. Because processes were analog, it was difficult for management teams to identify problems or trends; by the time data was available, it was a week out of date, so management became reactive to issues rather than proactive.
Kapio Cloud, which combines document control, reporting and dashboards, is the result of Wright and Lorenzen’s work to digitalise those processes. Lorenzen left the construction industry to develop the platform in 2016, while Wright and other industry investors provided seed funding to develop the platform. Steve Arnold, who has a background in technology start-ups in Poland, joined the business soon after.
The application, currently available in 20 languages, is now in use on more than 20 projects in Europe, Asia and South America, worth an estimated €35bn (£30bn).
[Disclosure: I provided some consultancy services to Kapio in early 2017.]