Supply Chain Stuff
Lack of trust and transparency
Construction professionals contribute large amounts of labor and material to improve a property but often must wait 30-60-90+ days before getting paid, making them unintentional and unsecured creditors of construction projects.
To secure their risk as a creditor, some attempt to manage their right to lien a property in the event that they are not paid. However, construction lien rights can be difficult to manage.
Antiquated fund disbursement
Antiquated paper-based payment processes haven’t kept up with emerging technologies, making payment unnecessarily slow.
With or without lien rights, these antiquated disbursement systems leave funds susceptible to fraud and theft.
It is difficult for the small/medium construction professional to begin new projects and invest in growth when their funds are tied up in past projects.
And, opening lines-of-credit or lending against invoices (factoring) for construction professionals is considered risky by traditional banks, making it increasingly difficult to access capital.
A Time For Change
Residential construction in the United States has experienced massive changes in the last century. Indoor plumbing and electric, and therefore the roles of plumbers and electricians, was not prevalent until well into the 20th century. The evolution of concrete, dimensional lumber and drywall has replaced the construction materials and techniques of the earlier pioneers and settlers. Housing products, i.e. - single family homes, apartments, condominiums, continue to change with the cycles of economy and demographics. However, unchanged since the birth of our nation is the risk, settlement practices, and poor access to capital for builders, trade contractors, and material suppliers.
Transparent Lien Right Registry
By leveraging blockchain technology and other construction service technologies (such as lien management and draw disbursement) we can achieve better transparency, communication and improved flow of funds.
Fast & Easy Settlement
Blockchain technologies allow money and other forms of value to flow more easily from one party to another. Self regulating systems bypass unnecessary intermediaries and do away with the majority of inherent trust issues. More importantly, the speed in which payments and proper documents can be transacted and recorded is astonishing compared to current processes.
On-Demand Construction and Lien Financing
Utilizing construction liens as collateral and locking them onto the blockchain through smart contracts allows construction professionals to borrow money against their “lien-backed invoices” for projects they are waiting to get paid on - unlocking capital (liquidity) for growth.