Practical Nerds

By Patric Hellermann

The latest in venture and technology in the real world, from construction-tech to design-tech. Two early-stage investors shooting the breeze about startups, founders and venture funding. We talk about... more

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FAQs about Practical Nerds:

How many episodes does Practical Nerds have?

The podcast currently has 69 episodes available.

Practical Nerds episodes:

May 13, 2025 069 | AEC SaaS Benchmarking 2025 | The Numbers Analyzed
About This Episode
In this episode of Practical Nerds, Patric Hellermann and Shub Bhattacharya conduct a detailed financial benchmarking analysis of leading AEC software companies again, comparing them with established SaaS industry leaders. The hosts dive into financial metrics from Autodesk, Bentley Systems, Procore, Adobe, ServiceNow, and Intuit, examining everything from revenue growth to operating margins.

In This Episode
Patric and Shub analyze the latest financial data from annual reports of key AEC software companies (Autodesk, Bentley Systems, Procore) and compare them with industry benchmarks (Adobe, ServiceNow, Intuit).
The benchmarking reveals Procore's declining growth trajectory, with guidance for only 8% annual growth in 2025, while competitors like Autodesk are projecting faster percentage growth.
Financial analysis shows Adobe delivering exceptional performance across metrics despite lower market valuation multiples compared to ServiceNow, highlighting potential market inefficiencies.
Bentley Systems emerges as an efficiency standout, achieving remarkable free cash flow margin (31%) despite moderate gross margins (81%), showcasing excellent operational execution.

Timestamps
(00:00) - Introduction
(01:05) - Explanation of the benchmarking exercise and disclaimer
(04:06) - Clarification on using GAAP numbers for analysis
(04:32) - Financial data collection for Autodesk
(09:57) - Financial data collection for Bentley Systems
(13:54) - Financial data collection for Procore
(18:13) - Financial data collection for Adobe
(27:03) - Financial data collection for ServiceNow and Intuit
(32:27) - Conclusion of data collection phase
(33:09) - Analysis of 2023 benchmarking results
(42:19) - Analysis of 2025 benchmarking results
(42:47) - Comparison of revenue growth across companies
(44:24) - Analysis of gross margin performance
(45:56) - Discussion of operating income margins
(47:54) - Review of annual revenue per employee
(52:28) - Evaluation of the Rule of 40 performance
(54:21) - Analysis of sales and marketing intensity
(54:59) - Comparison of R&D intensity across companies
(56:10) - Review of G&A intensity
(57:09) - Analysis of free cash flow margins
(58:48) - Discussion of cash conversion scores
(59:46) - Comparison of company valuations
(01:03:33) - Final thoughts on valuations and founder expectations

Resources or Companies Mentioned
Autodesk: https://www.autodesk.com/de
Bentley Systems: https://www.bentley.com/
Procore: https://www.procore.com/de
Adobe: https://www.adobe.com/
ServiceNow: https://www.servicenow.com/
Intuit: https://www.intuit.com/

Connect With Us
Practical Nerds Website:⁠⁠ https://practicalnerds.com/⁠⁠
Subscribe to the Newsletter: ⁠⁠https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/⁠⁠
Foundamental: ⁠⁠https://www.foundamental.com/⁠⁠
Patric Hellermann: ⁠⁠https://www.linkedin.com/in/aecvc/⁠⁠
Shub Bhattacharya: ⁠⁠https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/⁠⁠
Youtube: ⁠⁠https://www.youtube.com/@foundamentalvc⁠⁠⁠
The Daily Blueprint: ⁠⁠https://tinyurl.com/the-daily-blueprint⁠⁠⁠
#ConstructionTech #SaaSMetrics #FinancialBenchmarking

...more
1h 9min
May 06, 2025 068 | The Art of Pre-Emption | Navigating Early Fundraising Offers in Construction Tech
About This Episode
In Episode 68 of Practical Nerds, Patric Hellermann and Shub Bhattacharya dive deep into the concept of "preemption" in venture capital fundraising for construction tech startups. They explore the conditions necessary for successful preemptions, the potential pitfalls, and how founders can navigate this complex process to ensure long-term success.

In This Episode
Patric and Shub define preemption in VC fundraising as investors offering capital before a planned financing round, avoiding competition and market processes.
The hosts outline the conditions for successful preemptions, including company performance excellence, investor conviction, and the importance of building authentic relationships before any preemption attempt.
They discuss the risks of preemptions, particularly valuation challenges where artificially high valuations can create unrealistic expectations for future rounds, potentially setting construction tech startups up for difficult down rounds.
The conversation compares internal versus external preemptions, with both hosts favoring internal preemptions from existing investors who already understand the business and have demonstrated alignment with the founder's vision.

Timestamps
(00:00) - Introduction
(01:41) - Defining preemption in VC fundraising context
(03:35) - Conditions for successful preemptions
(11:42) - How rare successful preemptions actually are
(12:09) - Identifying genuine versus opportunistic preemption attempts
(16:28) - The valuation trap in preemptions
(21:26) - What makes a preemption "done right"
(24:32) - Weighing preemption against discovering true market valuation
(27:56) - Market volatility as a factor in preemption decisions
(32:05) - Internal vs external preemption: which is better for construction tech startups
(36:35) - Frequency of successful preemptions in construction tech

Connect With Us
Practical Nerds Website:⁠⁠ https://practicalnerds.com/⁠⁠
Subscribe to the Newsletter: ⁠⁠https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/⁠⁠
Foundamental: ⁠⁠https://www.foundamental.com/⁠⁠
Patric Hellermann: ⁠⁠https://www.linkedin.com/in/aecvc/⁠⁠
Shub Bhattacharya: ⁠⁠https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/⁠⁠
Youtube: ⁠⁠https://www.youtube.com/@foundamentalvc⁠⁠⁠
The Daily Blueprint: ⁠⁠https://tinyurl.com/the-daily-blueprint⁠⁠⁠
#VentureCapital #ConstructionTech #Preemption

...more
40min
April 28, 2025 067 | Why Great Founders Reveal Their Weaknesses | Building Investor Trust Through Transparency
About This Episode
In Episode 67, Patric and Shub explore why transparency about limitations and past failures is crucial for building trust between founders and investors. They discuss how acknowledging constraints doesn't signal weakness but rather demonstrates a professional athlete's mindset of continuous improvement that leads to stronger partnerships and better businesses.

In This Episode
Patric explains why investors distrust founders who hide their weaknesses, comparing it to establishing trust in a marriage where honesty about limitations is essential for a strong relationship.
Shub discusses how acknowledging constraints is the only way to improve as an individual and organization, using the Theory of Constraints to identify and eliminate bottlenecks.
The hosts share real examples of how vague answers, white lies, and glossing over problems during due diligence can completely erode trust and derail potential investments.
They examine how exceptional founders and investors are more comfortable discussing their limitations because they know their overall value proposition remains strong despite imperfections.

Timestamps
(00:00) - Introduction
(01:53) - Building trust during the diligence phase
(03:30) - The misconception about hiding weaknesses
(08:56) - The Theory of Constraints and acknowledging bottlenecks
(15:03) - How founders hurt themselves by hiding limitations
(16:31) - The professional athlete's mindset
(19:15) - Red flags: embellishment and vagueness
(22:27) - Cultural differences in acknowledging responsibility
(24:42) - Game theory: What hiding weaknesses reveals about you
(28:05) - Building emotional bonds through vulnerability
(32:26) - The importance of identifying your constraints
(35:42) - Conclusion and wrap-up

Connect With Us
Practical Nerds Website:⁠ https://practicalnerds.com/⁠
Subscribe to the Newsletter: ⁠https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/⁠
Foundamental: ⁠https://www.foundamental.com/⁠
Patric Hellermann: ⁠https://www.linkedin.com/in/aecvc/⁠
Shub Bhattacharya: ⁠https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/⁠
Youtube: ⁠https://www.youtube.com/@foundamentalvc⁠⁠
The Daily Blueprint: ⁠https://tinyurl.com/the-daily-blueprint⁠⁠
#ConstructionTech #AIInvestment #DataInfrastructure
...more
36min
April 15, 2025 066 | Bathtubs & AI | Why Data Infrastructure Beats AI-Only Solutions in Construction Tech
About This Episode
In this insightful discussion, Patric Hellermann and Shub Bhattacharya explore their investment thesis regarding AI versus data infrastructure, authoring tools, and systems of record in the architecture, engineering, and construction (AEC) technology space. They delve into why companies that serve as the "bathtub" containing AI capabilities may ultimately create more value than pure AI feature companies.

In This Episode
Patric and Shub discuss why AI-generated content in construction documents typically requires extensive editing, making authoring tools and systems of record crucial for deterministic outcomes.
They explore the "bathtub and water" analogy (credited to Stan from Rayon), where AI is like tap water—ubiquitous but a commodity—while the true value comes from the vessel containing it.
The hosts examine various types of "bathtubs" in construction tech, including ERPs, authoring tools for designers, data infrastructure companies, and systems of record that provide structure to unstructured data.
Shub and Patric analyze why it's significantly harder for AI-first companies to build data infrastructure around themselves than for infrastructure companies to incorporate AI functionality.

Timestamps
(00:00) - Introduction
(01:55) - Setting up the discussion topic: AI versus authoring tools
(05:13) - Thesis on AI-generated content requiring iteration and editing
(08:27) - AI becoming ubiquitous like "internet" in investment thesis
(13:28) - The "bathtub and water" analogy for AI and data infrastructure
(15:27) - Examples of "bathtubs" in construction tech
(18:07) - Challenges for AI-first companies trying to build infrastructure
(24:23) - The importance of data structuring and infrastructure
(28:56) - Agentic AI and its limitations without systems of record
(33:20) - Current landscape of system-of-record companies in construction

Resources or Companies Mentioned
Autodesk: Amy Bunszel mentioned regarding investment thesis about AI (https://www.autodesk.com/)
Speckle: Referenced as an example for 3D geometric data infrastructure (https://www.speckle.systems/)
UiPath: Discussed in context of workflow automation challenges (https://www.uipath.com/)
Procore: Mentioned as incumbent system of record for US contractors (https://www.procore.com/de)
Glodon: Referenced as a significant player in the Chinese market (https://www.glodon.com/en/)

Connect With Us
Practical Nerds Website: https://practicalnerds.com/
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
Youtube: https://www.youtube.com/@foundamentalvc⁠
The Daily Blueprint: https://tinyurl.com/the-daily-blueprint⁠
#ConstructionTech #AIInvestment #DataInfrastructure
...more
37min
April 04, 2025 065 | Leapfrogging in Construction Tech | How Markets Skip Ahead to Revolutionary Solutions
About This Episode
In this episode, Patric and Shub explore the concept of "leapfrogging" in technology adoption and its potential impact on construction technology. They analyze how markets and companies can skip established development steps to implement more advanced solutions, particularly examining where construction tech might see revolutionary changes through this phenomenon.

In This Episode
Patric and Shub define leapfrogging as when users skip incremental technological steps to adopt more advanced solutions, driven by high incremental value in specific markets.
The hosts explore historical examples of leapfrogging across different industries and regions, including mobile technology in India, digital payments infrastructure, electric vehicles in China, and super apps like WeChat.
Patric presents a compelling thesis that European construction firms might leapfrog the fragmented point-solution approach seen in US construction technology and move directly to integrated tech stacks with custom data infrastructures.
The discussion examines how AI might serve as a catalyst for construction technology leapfrogging by accelerating software fatigue and creating opportunities for new entrants to reimagine the entire technology stack.

Timestamps
(00:00) - Introduction
(01:24) - Topic introduction: leapfrogging in construction technology
(04:18) - Defining leapfrogging and its principles
(05:38) - Examples of leapfrogging from India: mobile technology adoption
(07:51) - Infrastructure leapfrogging and mobile adoption patterns
(10:37) - Digital payments infrastructure in India as a leapfrogging example
(13:30) - Chinese examples: electric vehicles and super apps
(17:10) - Drone warfare as a European leapfrogging example
(20:03) - Applying leapfrogging concepts to construction technology
(21:11) - Cloud manufacturing as a construction tech leapfrogging example
(25:10) - Software adoption differences between US and European markets
(30:01) - Thesis on how European construction firms might leapfrog in software adoption
(33:29) - AI as a catalyst for construction technology leapfrogging
(39:56) - Why incumbents may not lead the leapfrogging movement
(44:39) - The Chinese AI ecosystem and open source potential
(48:38) - Conclusion and strategic implications

Resources or Companies Mentioned
WeChat: https://www.wechat.com/
Gojek: https://www.gojek.com/
Procore: https://www.procore.com/

Connect With Us
Practical Nerds Website: https://practicalnerds.com/
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
Youtube: https://www.youtube.com/@foundamentalvc
The Daily Blueprint: https://tinyurl.com/the-daily-blueprint
#ConstructionTech #Leapfrogging #TechnologyAdoption
...more
51min
March 28, 2025 064 | Germany's Trillion-Euro Construction Tech Boom | Navigating Europe's Untapped Market Potential
About This Episode
In this milestone 64th episode of Practical Nerds, hosts Patric Hellermann and Shub Bhattacharya meet in person at their Berlin office to discuss Germany as a construction tech hub. They analyze Germany's position as the world's third-largest economy and explore how a new trillion-euro infrastructure and defense investment plan could create unprecedented opportunities for construction technology companies.

In This Episode
Germany's trillion-euro infrastructure and defense fund signals a major shift from years of fiscal surplus to strategic investment, potentially triggering a construction tech boom across commercial and infrastructure sectors.
The hosts discuss Germany's historical pattern of making bold policy decisions during times of change, with previous examples creating prosperity booms that could repeat with the new investment plan.
Germany has built competence clusters in specific construction tech areas like energetic renovation and construction robotics, positioning it as a key innovation hub alongside France in the European market.
Major American capital is flowing into Europe, with German companies attracting attention for their methodical approach to scaling and their ability to manage multiple bets simultaneously.

Timestamps
(00:00) - Introduction
(03:33) - Germany's significance in the global economy
(05:07) - The trillion-euro investment plan and its implications
(08:00) - Comparing infrastructure investments across countries
(11:30) - Germany's fiscal policies and historical surplus
(14:12) - Infrastructure decay and railway challenges(16:06) - German government formation process
(25:07) - The European pattern of implementing bold changes
(32:31) - German founders' strengths in multi-project management
(35:05) - German vs. Indian approaches to business building
(44:25) - Exciting construction tech subsectors in Germany
(48:10) - Germany and France as leading European markets for construction tech

Resources or Companies Mentioned
ENPAL: Solar installation company and unicorn in Germany
https://www.enpal.de/

Connect With Us
Practical Nerds Website: https://practicalnerds.com/
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
#ConstructionTech #GermanEconomy #InfrastructureInvestment
...more
52min
March 21, 2025 063 | The Rise of Indian Construction Robotics | From Local Startups to Global Players
About This Episode
In this episode, Patric Hellermann and Shub Bhattacharya dive into the unexpected emergence of construction robotics companies from India. They explore how these companies have evolved from struggling startups to profitable enterprises, examining the unique economic and market conditions that have created this surprising development in the global construction technology landscape.

In This Episode
Shub shares insights on how Indian construction robotics companies have transitioned from selling hardware to offering "machines as a service" or "manufacturing as a service," resulting in impressive margins of 30-50%.
Indian robotics companies are now securing international contracts, including projects in the US and Middle East, and partnerships with global technology companies like Apple.
The hosts discuss how India's cost advantages allow robotics startups to conduct more "reps" (iterations and practice) at a fraction of the cost compared to Western markets, creating a competitive edge.
Both note that the Indian construction robotics ecosystem benefits from exceptional engineering talent from institutions like IIT, combined with developing market conditions that enable companies to mature over longer timeframes.

Timestamps
(00:00) - Introduction
(01:21) - Discussion of India's parallels to China's automation journey
(02:57) - Engineering talent and market conditions in India
(06:15) - Examples of Indian robotics companies securing international projects
(07:50) - Economic analysis of Indian robotics companies
(13:08) - Impressive profit margins and bankability of these companies
(17:44) - Factors contributing to the success of Indian robotics startups
(22:15) - Cost advantages for iterative development ("reps")
(27:29) - Future outlook for Indian construction robotics

Resources or Companies Mentioned
Apple: https://www.apple.com/
Practical Nerds Website: https://practicalnerds.com/

Connect With Us
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
#ConstructionRobotics #IndianTech #MachinesAsAService
...more
39min
March 14, 2025 062 | The Three Pillars of Exceptional Startup Leadership | Insights from a CEO Conversation
About This Episode
In this episode, Patric Hellermann shares insights from a recent conversation with a portfolio founder about the evolving role of a startup CEO. The discussion breaks down three critical aspects of effective leadership: hiring exceptional people and organizing them exceptionally, acquiring primary information for decision-making, and making bold bets with decisive execution.

In This Episode
Patric explains how founders must learn to recognize and hire truly exceptional talent, noting that many CEOs don't actually know what excellence looks like until they've been exposed to it.
The hosts discuss the crucial practice of obtaining "primary information" directly from customers and operations without filtering, enabling CEOs to make better decisions as their companies scale.
Shub and Patric explore how organizational structure must evolve as companies grow, using InfraMarket as an example of a venture that successfully reorganized to accommodate scaling and new business directions.
The conversation delves into why making bold bets and executing them decisively is essential for company growth, highlighting examples from their portfolio companies that made unexpected pivots during challenging times.

Timestamps
(00:00) - Introduction
(01:30) - Setting up the discussion about a portfolio founder call
(02:32) - How investors work with founders and different interaction styles
(07:35) - The three key responsibilities of a CEO
(11:46) - Thermodynamics metaphor for company transformation
(14:20) - Hiring exceptional people and recognizing excellence
(21:50) - Organizing talent in exceptional ways
(25:10) - The importance of acquiring primary information
(28:56) - How CEOs can cut through filtered information
(32:48) - Making bold bets and executing them decisively
(41:55) - The rarity of CEOs who excel at all three responsibilities

Resources or Companies Mentioned
InfraMarket: https://infra.market/
Revolut: https://www.revolut.com/

Connect With Us
Practical Nerds Website: https://practicalnerds.com/
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
#StartupLeadership #CEOResponsibilities #VentureCapital
...more
47min
March 07, 2025 061 | Going Global | How US Construction Tech Founders Can Win in International Markets
About This Episode
In this episode, Patric Hellermann and Shub Bhattacharya discuss the challenges and opportunities for US-based construction tech founders looking to expand into international markets. They explore the cultural, business, and regulatory differences across Asia, Europe, and the Middle East, providing insights on how to navigate these diverse markets successfully.

In This Episode
Shub and Patric explore how business cultures in Asia often prioritize building personal trust before transactions, contrasting with the more transactional approach common in the US.
The hosts discuss European markets' preference for substance and facts over sales pitches, highlighting how risk mitigation often resonates more with European clients than pure opportunity.
They analyze the unique opportunity in Middle Eastern markets (particularly Saudi Arabia, UAE, and Qatar) where American companies and products often have a distinctive advantage.
The conversation examines how construction tech is maturing globally, creating more opportunities for founders to internationalize their solutions when the time is right.

Timestamps
(00:00) - Introduction
(01:25) - Topic introduction: US founders targeting non-US markets
(03:47) - Asian markets and cultural differences
(09:21) - Trust deficit in East Asian business cultures
(14:05) - Alternative approaches for penetrating emerging markets
(15:57) - Common US expansion mistakes in Asian markets
(17:19) - European market characteristics and business approach
(20:23) - European preference for facts and observations
(24:48) - Navigating regional differences within Europe
(28:40) - Middle East as a target market for US construction tech
(32:19) - The maturing construction tech market and internationalization

Resources or Companies Mentioned
Procore: https://www.procore.com/

Connect With Us
Practical Nerds Website: https://practicalnerds.com/
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
#ConstructionTech #GlobalExpansion #BusinessCulture
...more
33min
February 28, 2025 060 | Cloud Manufacturing | How Coca-Cola's Model Is The Hidden Blue-Print To Revolutionize Construction Tech
About This Episode
In this insightful episode, Patric and Shub explore the concept of cloud manufacturing and its applications in the construction technology space. Using Coca-Cola's business model as a prime example, they break down how traditional notions of manufacturing are being transformed through asset-light approaches that maximize efficiency and utilization.
In This Episode
Shub reveals how Coca-Cola operates as a B2B company rather than B2C, selling concentrate to bottlers who handle production, distribution, and sales while Coca-Cola maintains the brand and marketing.
Patric and Shub discuss how the cloud manufacturing model differs from managed marketplaces, with cloud manufacturers focusing on concentration of suppliers and assuming utilization risk in exchange for better terms.
The hosts explore how cloud manufacturing platforms can strategically match demand and supply both at the customer level and raw material level to maximize asset utilization and price realization.
Patric offers counterintuitive guidance for founders building cloud manufacturing businesses, emphasizing the importance of maximizing utilization of existing assets before building new supply.
Timestamps
(00:00) - Introduction
(00:55) - Banter
(03:20) - Introducing the concept of cloud manufacturing
(05:26) - Coca-Cola as a B2B company example
(11:05) - Fast food franchises as another cloud manufacturing example
(12:35) - Cement and concrete manufacturing comparison
(15:19) - Benefits of cloud manufacturing over traditional contract manufacturing
(21:45) - Difference between cloud manufacturing and managed marketplaces
(26:20) - Examples of cloud manufacturing in construction tech
(32:05) - Maximizing utilization of existing assets vs. building new supply
(35:56) - Concluding thoughts on the future of cloud manufacturing in construction
Resources or Companies Mentioned
InfraMarket: A large-scale cloud manufacturing platform
Metalbook: An example of cloud manufacturing in metals supply chains
Z-Work: Cloud manufacturing platform in construction tech
Connect With Us
Practical Nerds Website: https://practicalnerds.com/
Subscribe to the Newsletter: https://www.linkedin.com/newsletters/practical-nerds-7180899738613882881/
Foundamental: https://www.foundamental.com/
Patric Hellermann: https://www.linkedin.com/in/aecvc/
Shub Bhattacharya: https://www.linkedin.com/in/shubhankar-bhattacharya-a1063a3/
#CloudManufacturing #ConstructionTech #SupplyChainInnovation
...more
38min

FAQs about Practical Nerds:

How many episodes does Practical Nerds have?

The podcast currently has 69 episodes available.