Kode Labs aims to become the Salesforce of commercial building automation

Like many immigrants, the New York City skyline was one of the first sights young brothers Edi and Etrit Demaj saw when they arrived in the United States more than 20 years ago . The couple and their families fled violence in their native Kosovo and still remember the view as planes flew overhead.

“The first building we saw was the Empire State Building,” Etterit recalled.

The Demaj family soon settled in Detroit, where the brothers completed school and started several companies, including their latest, Kode Labs, which integrates and automates various systems in commercial buildings, including the Empire State Building.

“This is the American dream,” Etterit said.

When the Demaj brothers founded Kode in 2017, they sought to bring building management into the cloud era. They began developing a suite of software that could digest data from every internet-connected part of a building’s operations, including air handlers, fire alarms, elevators, occupancy sensors, electric vehicle chargers, and more, and then use it in a way to improve efficiency way to control them systematically. Kode claims it can communicate with more than 130 different systems.

The brothers liken it to integrating the operating system that builds the system, much like how a computer operating system integrates various circuit boards.

“What we’re trying to do is bring in data and normalize it, index it, use that data to build applications on top of it, making the operating system more useful, more energy efficient, and creating amazing experiences at the same time,” Edi told Our technology blog.

Commercial buildings may seem like clean neighbors, but they produce 16% of all carbon pollution in the United States, according to the U.S. Environmental Protection Agency (EPA). Many businesses operate in ways that are not only environmentally damaging, but also financially unsound.

Today’s commercial buildings are rife with inefficiencies that automation can solve. In the process, owners can not only reduce their carbon emissions but also save significant amounts of cash. According to Project Drawdown, global adoption of automation could reduce carbon emissions by 9.5 billion to 14 billion tons between 2020 and 2050 and save owners at least $2.3 trillion.

Kode has also developed a range of apps that run on its platform, allowing customers to monitor energy usage, track carbon emissions and keep an eye on water consumption. Not only do these help control costs, but some of the data is necessary to comply with laws in various cities, including New York City, where Local Law 97 will require buildings over 25,000 square feet to reduce their carbon emissions by 2017 40%. The end of the decade.

“With all the targets and laws that are in place in so many different locations and areas, they have no choice but to continue down this path,” Etterit said.

Etrit said the company’s software is already used by construction managers and owners on five continents, and its customers include Fortune 100 companies and higher education institutions. He added that the company has been profitable from day one. Edi said customer churn is “zero” and annual recurring revenue has grown 200% annually over the past three years.

Edi said Kode’s business model is similar to Salesforce, with customers first paying an implementation fee negotiated based on the size of their property portfolio and then paying recurring fees based on the square footage managed and the number of applications the customer chooses to use.

Kode has grown significantly since raising an $8 million Series A in 2022, with more than 40 employees in Detroit, 150 in Kosovo, and a handful of employees in other countries.

Recognizing the opportunity for rapid growth, Kode recently raised $30 million in Series B funding, TechCrunch has learned exclusively. The round was led by Maverick Private Equity, with participation from I Squared Capital and Telus Ventures. The startup plans to use the funding to expand its app market and further develop the use of artificial intelligence to optimize construction operations.