Q&A with Gonzalo Galindo, head, Cemex Ventures
Cemex Ventures is the corporate venture capital (CVC) arm and the open innovation platform of Mxico-headquartered building materials manufacturer Cemex, which invests in construction technology-focused disruptive startups that are able to provide answers to real daily-basis problems happening in the construction value chain.
Apart from making investments, Cemex Ventures also helps early-stage companies that need support in their market growth process, through pilots, research and development (R&D) testing activities or giving them access to its network of partners including other investors, VCs, accelerators, investment funds, clients, suppliers and the academia. Likewise, Cemex Ventures has launched some in-house incubated solutions to attend to the specific needs of the core business.
Galindo said: “To understand what construction innovation is, we first need to establish some context. Innovation in our industry has been lacking for many years.
“While other industries, like automobiles, have been quick to adapt to the digital age, construction has kept a very slow pace in the race. Why? It is expensive, requires a lot of research, lacks standardisation, material availability can be a challenge, and there is a shortage of professionalised workforce.
“More so, the fragmentation and lack of collaboration within the different sections of the construction value chain also make it harder for innovation to come through in the industry. With this in mind, it is safe to say that construction innovation is not straightforward; it is a collaborative effort to improve the diverse processes that encompass the industry as a whole.
“By promoting construction innovation within every significant player in the construction value chain, it will be easier to enhance its productivity parameters and technology adoption.”
Strategic and Leadership measures:
· Business unit partnerships and development with portfolio companies:
Cemex Ventures invests from a strategic point of view, from the balance sheet. Thus, we are not only giving financial support to the startups but also facilitating their scalability through pilots, proof of concepts or R&D activities. In that sense, these are the partnerships that Cemex Ventures has developed with our portfolio companies:
- Prysmex → signed a commercial partnership to sell directly to Cemex – Cemex Ventures is an investor and a client
- Modulous → Cemex as a strategic supplier of their materials and products
- Soil Connect → launched a pilot project in Florida (Orlando and Tampa) in January 2021 – working on a couple more projects in the US
- Arqlite → developing product testing projects at Cemex laboratories in the US, the UK, France and Israel, in order to improve its capabilities
- Energy Vault → working closely with its team in the development and manufacturing of the concrete blocks
- GoFor → working on a commercial partnership to launch a similar platform in Mexico – not yet closed
Besides, we are also developing these partnerships and supporting activities with other startups that could be considered as a potential investment in the short term, but need to test their solution more precisely before closing the deal. For example, we have developed pilots and R&D activities with Cloud Cycle, Soil Connect, Insylo, Flexofibers, Hiboo, MachineMax, Trinov, Sidcodx, Carbon Upcycling, Caidio, Cobod, BeMore3D and ChainGo.
· Product or strategy roadmaps and public leadership position in conferences and associations
Cemex Ventures has developed several roadshows in different geographies that have been considered strategical for Cemex and Cemex Ventures: Europe (the UK, France, Germany, Scandinavia), the US (New York, Florida, Texas and the Bay Area), Latin America (Mexico, Colombia, Peru), the Middle East (Israel and the United Arab Emirates), India and the Asia-Pacific region (China, Singapore, Thailand and Japan).
· Team expansion and recent promotions:
Cemex Ventures was born as a small team with four people in early 2017. Currently, we have a team composed of over 25 people, located in three different offices in Madrid, Spain; Monterrey, Mexico; and Shanghai, China. Due to the increasing interest in the contech ecosystem in the different regions, new offices were opened to better support the entrepreneurial and investment activity, especially in LatAm and Apac regions.
· Plans for the year ahead:
Currently, Cemex Ventures efforts are leaded by three big verticals and trends: 1. sustainability, 2. productivity and 3. urbanisation.
Due to the recent partnerships signed by a couple of companies in the CO2 field, Cemex Ventures is trying to accomplish the carbon footprint mitigation goals set by the parent company. In this sense, Cemex Ventures, together with the core business units of Cemex, will continue working making investments and pilots in the fields of circular economy, construction waste management and the development of new materials.
Besides, Cemex Ventures will continue strengthening the Construction Startup Competition (5th edition in 2021). As happened in 2020, in 2021 this competition has also been launched together with other relevant industry players (Ferrovial, Hhilti, Vinci, Saint Gobain, Haskell and GS Group). This challenge has become one of the most important initiatives for Contech entrepreneurs and we want to continue making it bigger, with high quality (and quantity) projects.
Likewise, Cemex Ventures, together with its parent company Cemex, is working on the digitization of the main processes of its core business, such as last-mile deliveries, tracking of the orders or the fully digital management of the waste generated at the construction sites, showing this way a clear commitment of being prepared to the disruption wave of the industry.
Finally, Cemex Ventures team is constantly developing its network of entrepreneurs, investors and corporates and it will continue expanding it this year. Currently, Cemex Ventures has more than 150 partners, which supports us in analysing the most disruptive solutions and implementing them at several industry projects in the most promising geographies.
· What do you think all corporations could do better to make it a stronger industry?
Innovation is change and having an openness to improve products, processes, and services. Whether it is from incorporating new ideas into already established systems, or completely transforming how something is done, innovation is the key to solving the challenges many companies are faced with today.
Having said that, we strongly believe that there are a few actions that big corporations should adopt and support in order to support innovation in the industry:
1. Intrapreneurship: encouraging employees at the organization to share their ideas and thoughts related to specific challenges that the corporation would need to face up, such as, the accomplishment of sustainability goals.
2. Sharing efforts and thoughts: instead of seeing each other as rivals, corporations should talk to all players in the industry aiming to identify similar problems. At the end of the day, same industry companies have the same challenges and joining forces, they can identify faster the potential answers to them. That is why Cemex Ventures strongly works on the strengthening of its partners and collaborators to get external inspiration. The sooner a corporation realizes that it needs to look outside and look for different partnerships, the sooner it can really start making progress.
3. Simplification of bureaucracy and non-sense processes: some bureaucracy is a necessary check, but too many blockers can slow the disruption at a corporation. The goal is to first allow good ideas to rise quickly to the top and then create clear pathways to implement and validate them in the potential market as soon as possible.
· For colour, what did you do prior to your venture role or in your spare time?
Gonzalo Galindo has a deep professional background in the industry. He started his career at McKinsey. After that, he joined Cemex, where he developed his long and deep career. He has had different positions in the last 18 years, having served as a regional president of the Florida and Carolinas region at Cemex until 2016.
Galindo served as regional president of Cemex USA East. He was responsible for commercial sales activities, as well as aggregates, ready mix, concrete product and gypsum operations in Florida. Galindo had served as the president of Cemex in the UK and was responsible for marine and land-based aggregates, cement, asphalt, ready mix and building products operations.
Since joining Cemex in 1998, he has held a number of different leadership roles within the group, including vice-president of strategic planning and integrated functions (Europe, Middle East, Africa, Asia and Australia), corporate director of strategic planning (prior to the acquisition of RMC and later leading its integration process in Europe) and vice-president of planning in the Philippines and Asia.
Since 2016, he is the head of Cemex Ventures, where promotes the construction revolution by working with startups in construction, entrepreneurs, universities, and other entities interested in the industry. Thanks to his and his team’s work, he has been named the most relevant investor in the construction ecosystem for the second year in a row. Besides, Gonzalo is an avid soccer and Mexican tacos fan – that is why Cemex Ventures bi-weekly newsletter is called contech Tacos.