Procore will soon launch Procore Pay, an integrated payment system, the company announced Nov. 8 at its Groundbreak conference in New Orleans.
The construction technology company is working with Goldman Sachs Transaction Banking to embed payments functionality into its construction management platform. Procore Pay will launch in early 2023, Tooey Courtemanche, CEO of the Carpinteria, Calif.-based technology company, said in his keynote at the conference.
The digital lien waiver management system derived from Procore’s 2021 acquisition of LevelSet will also be brought in to Procore Pay. At $500 million, LevelSet is still Procore’s largest acquisition ever.
“The No. 1 problem that we wanted to solve in 2022 was lien rights management,” Courtemanche said at the time. “It’s a priority for Procore to finish these complex workflows for our customers. So, definitely we are going to be looking at what the most expeditious route is here.”
More than two-thirds of payments made to subcontractors are received more than 30 days after invoicing, according to a survey by Dodge Data & Analytics sponsored by Procore. The 2022 Top Business Issues for Specialty Contractors Report surveyed 537 specialty trade contractors in the U.S., Canada, U.K., Australia and New Zealand. Company sizes ranged from $2 million to over $2 billion in annual revenue.
Simplifying construction payments has been a goal of Procore since its founding in 2002. Scott Wolfe, LevelSet founder and now president of Procore Labs, said at the time of the acquisition that being a part of Procore would help LevelSet “accelerate our mission of reducing the compliance burdens and payment delays for all players involved in a construction project.”
Geoffrey Lewis, Procore vice president of product management said Procore Pay users all receive a Goldman Sachs Transaction Banking Account as part of the platform and that the accounts users want to use for payments will be linked to that new account.
Dustin Burns, vice president of information technology at McCownGordon Construction in Kansas City said his company is beta testing Procore Pay and is satisfied, so far, that it'd be an improvement over its current payment systems.
"Right now you need project accountants going through a process with several steps to pay suppliers and subcontractors and it's all project-based," Burns said. "This streamlines that process and one person can check all of those boxes for payments, lien waivers and the other transactions we perform."
Burns also said that Procore Pay opens up process efficiencies to general contractors including paying specialty contractors without yet waiving liens and other processes that weren't possible through traditional banking applications that don't have options construction-specific instruments of payment like lien waivers.
Procore also announced new predictive analytics and construction drawing connectivity capabilities in its platform at the first day of Groundbreak. But bringing in Goldman Sachs is seen as a serious move to tackle payment issues.
“We want to get construction payments down from 90 days to two weeks,” Courtemanche said.
