For years, Dayna Grayson invested in industrial innovation as a partner at NEA, one of the few prominent investors focused on the massive, and underserved, space. She found a surprise ally in fellow Washington, D.C.-area resident Rachel Holt, an Uber executive who most recently led the ride-hailing giant’s mobility unit. The two have now raised $140 million for their new firm, Construct Capital, for investments in manufacturing, supply chain, transportation and other foundational industries.
These formerly under-the-radar areas have gained attention (and cash) lately, and Grayson and Holt expect that trend to continue. “It’s like enterprise software investing over the past two decades,” Grayson says.
At NEA, Grayson, 44, led investments in 3D printing firm Desktop Metal, which recently went public and now trades at a market capitalization of more than $6 billion; design firm OnShape, since acquired by PTC for nearly $500 million; manufacturing software firm Tulip, and other leaders in the sector. Grayson, who has a bachelor’s in engineering from University of Virginia and an MBA from Harvard Business School, had joined NEA in 2012 after working at North Bridge Venture Partners. While at $24 billion (assets) NEA, she split her time between Washington, D.C. and Boston, a hotbed for industrial innovation and where a number of her portfolio companies were located.
Holt, 38, brings a background in the increasingly hot transportation sector. A psychology major at Amherst, she got her MBA at Stanford before joining Uber as its Washington, D.C. city general manager in 2011. Holt rose through the ranks at Uber to eventually run all of its U.S. and Canada operations by 2016 before switching over to its mobility unit two years later. That unit included Uber’s internal incubator and its bikes, scooters and public transit projects. She announced her departure in January 2020, in what Uber CEO Dara Khosrowshahi called a “bittersweet” moment for the company.
Construct Capital’s founders met six years ago and started bandying about investing ideas, especially in 3D printing and transportation. “We started advising and investing together pre-fund,” Holt says. “We found we were literally seeking one another out more and more to talk about the things we were seeing.”
About a year after striking out on their own, Grayson and Holt — who have been “bubbling” together during the pandemic to prepare for the firm’s launch — told Forbes in a video call that they had finished raising funds from a variety of institutional investors, family office and university endowments that they declined to name. In addition, Midas List venture capitalists Aileen Lee of Cowboy Ventures, Josh Kopelman of First Round and Scott Sandell of NEA have made personal investments in the new fund, they said.
They expect to create a concentrated portfolio of early-stage companies, both seed and series A, with investments typically ranging from $2 million to $7 million. “We’re not looking to place little bets in a lot of companies,” Holt says.
While they’re only now going public with the new fund, they’ve already made their first investments. Among them: early-stage industrial automation startup Copia and AI-powered ecommerce optimization firm Tradeswell, which raised a $15.5 million Series A last month. Most recently, they closed investments in ChargeLab, which provides software to electric vehicle manufacturers to help manage their charging experience, and Chef Robotics, which uses robotics and artificial intelligence to assemble food.
The theory behind Construct is a bet on the future of industry as one of the last bastions to be transformed by technology. In manufacturing, Grayson says, perhaps 60% of companies use cloud-based software compared to well over 90% of enterprises. “Our thesis is really around connecting, automating and then transforming,” she says. “I was doing this at NEA. Why not lift this out?”
As a rare venture firm launched by two women, Grayson, a founding member of All Raise, and Holt say that they’re seeing more women entrepreneurs than early in their careers. They hope to see more in the future, says Grayson. “We really want to back founders who will lay the foundation for what a modern culture and a diverse team can be,” she says. “That isn’t an explicit focus, but it’s an important part of who we are and therefore permeates everything we do.”