Kylie Davis

Welcome to the Proptech podcast. It's Kylie Davis here and I'm delighted to be your host as we explore the brave new world where technology and real estate collide. It's so great to have you here and to share stories of innovation and opportunity across real estate, property and building services. And the aim of each episode is to introduce listeners to a Proptech innovator who is pushing the boundaries of what's possible across how we design, build, buy, sell, rent and invest in property and all of the associated behaviour and activities around that. Now, none of this would be possible without our sponsors, so a big shout out to the Direct Connect team, making moving, easy, dynamic methods, the innovators behind the forms, live and realworks forms, and the Proptech Association of Australia. Thank you for your support of the podcast.

Kylie Davis

Buckle up, people, because in this episode of the Prop Tech Podcast, we are doing a deep dive into the world of building and construction technology. And it's a doozy. My guests are Murray Ellen andrew Giles from PT Blink. And this is an extended episode because we totally got into a conversation about the problems that desperately need solving in construction and the role of technology to digitize manual work that has been done the same way for centuries. PtBlink is a very exciting Prop tech that is working to, quote, industrialize construction using platform technology to manage the logistics and workflows of local building supply manufacturers anywhere, to create custom designed, flat pack, multi story buildings that can be assembled on site in a fraction of the time and for a fraction of the cost.

Kylie Davis

Namuri is a leading expert in post tension steel technology and has conceived, designed and built major projects around the world, including Australia, China, Hong Kong, Dubai and the Philippines, one of which includes Sydney's Olympic Stadium. And as well as being the founder of PT. Blink, he is the governor of the Sydney University Warren Centre of Advanced Engineering. Now, Andrew is Director of Marketing Communications at ptBlink and has had an extensive corporate career in communication roles, working for companies including Canon and Edelman. He's also on the Commercial Advisory Committee of the Proptech Association Australia and an enthusiastic advocate for the sector. So, here to tell us all about PT Blink and to unpack how we can modernise construction, murray Ellen andrew Giles, welcome to the Proptech Podcast.

Murray Ellen

Thank you very much, Kylie.

Andrew Giles

Thanks, Kylie.

Kylie Davis

So, first question is always the hardest and Murray, I think you're taking this one. What is the PT Blink elevator pitch?

Murray Ellen

Look, PT Blink has got technology that transforms the development of property rather than building a living environment. We empower to be manufactured and all the benefits come from that fundamental cool.

Kylie Davis

So I want to dive into this a bit more because I think this area is one of the biggest pain points at the moment, or one of the biggest pain points sitting inside the Prop tech universe. How does your prop tech do that? How does PT Blink fix this problem?

Murray Ellen

Well, fundamentally, if you look at prop tech or property, to our minds, it's been held back by construction. And that's where fundamental change needs to take place. And that's what we do at Blank. So if you look at the way things are traditionally delivered, it's just totally unsustainable. There's a whole range of productivity and losses and a hugely fragmented process. Kylie the waste is nuts. There's reports that somewhere between 30 and 60% of our landfills are from waste from construction. That's something I want to change now. And for my grandkids, we all should. The rates of injury incredibly high, the rework and the quality is low. It's well on the press. You just can't meet demand at the moment. And Blink goes a long way towards changing the traditional into something entirely new.

Murray Ellen

And that was the only way I could see to do it. Cool.

Kylie Davis

So I often joke that when we talk about real estate and buying and selling property, it's like the 1990s called and they want their process back because everything just happens on email. But when we talk about construction, it's like the one seven hundreds called, because if we're still turning up with they want their process back because we're still completely reliant on men with shovels and concrete and bricks and hammers.

Murray Ellen

I think, more to the point, nail bag. If you haven't got a nail bag, then you're not on my site. And that's all there is to it. Look and that's it. We're not using half the workforce. Somehow men like me are eliminating or not like me, as the case may be, are eliminating half the workforce or half the brains in the world aren't applied to what is a $12 trillion industry at the inside of risk. I'm not going to change because my great great grandfather did it that way, or I'm not going to change because that's how the Romans built. I've never heard anything more ridiculous in my entire life, and it's pretty well documented. There's quite a lot of momentum going towards a change.

Kylie Davis

Kylie just before we dive into how you guys do it, I just want to capture a little bit more information around the size of the pain that exists because of traditional methods of construction. How big an issue for us is it here in Australia?

Murray Ellen

Look, it's massive. I'm going to answer this from what I have experienced, okay? So you're not dealing with a fluffy founder here, right? So I've built in 35 countries and say it quite proudly, and we do that with people. And the pain isn't just felt here in Australia. I know you put your question that way. To a certain extent, I apologize, but I don't. It is a massive pain. And when you're in the shed next to me, Kylie, and you're getting told day one that you're late, you're getting told day two you're not getting paid and you get told day three that you're a subcontractor and you should behave that way. And the bulk of subcontractors are always late.

Murray Ellen

And then you go home to your family and you explain why the money is not coming and why this is happening, and you tend to take it out socially on those who are immediately around you. And this is not just here, this is around the world. Again, I couldn't see while blink. It's called blink or PT Blink, Andrew came from the idea that we can do things in terms of a very short period of time, PT Blink. And it's done. Main motivation for that was mathematics around the internal rate of return so that you drive it with money. So while money drives these things, to change the way it is now, you have to change everything.

Murray Ellen

But if you can change everything by changing time or valuing time, then you can change that household, then you can change the money that comes into the household, then you can change the outcomes. And I couldn't see any other way of doing it but changing everything.

Kylie Davis

Cool. So how does PT. Blink? Oh, sorry, Andrew, you wanted to add something?

Andrew Giles

I was just going to add to what Murray said there. Kylie and I know that you and I have spoken about the need for meaty changes for prop tech to address and certainly this is the big problem. There's never been a bigger problem. And if you have a look now, we're in the middle of a housing crisis. We've got, amid all the other things that we've got rising inflation, labor shortages, we have costs of materials and so on. But the biggest thing we have is a supply issue. So we've got lofty targets at a national level for housing of like in excess of a million houses over the next five years. And then we've got a range of predictions on how much the shortfall will be. So we're not even in the realm of quite being close to providing that supply.

Andrew Giles

And one of the key issues here is productivity at the core. So again, we'll discuss the foundation of PT Blink and the name and where it came from, because that's an interesting heritage story right there. But to highlight the blink aspect is speed. And speed is the time value of money. And the implications of that on cost and supply are never discussed. We don't ever discuss the aspect of speed. Now, if you have a look at the Australian Constructors Association released a report earlier this year called Disrupt or Die transforming Australia's Construction Industry. And they've said in there that basically there's been a 1.8% decrease in productivity since 1990. Other sources will say actually the decrease has happened since 1950, but there's a whole range of sources. But it's all heading in the wrong direction, it's heading backwards.

Andrew Giles

So I think productivity is the key and from our perspective, speed is a big part of that equation.

Kylie Davis

Cool. So how does ptBlink change all this? How does what you do work?

Murray Ellen

So it's pretty simple, really. Most great things are incredibly simple because we empower the manufacturer of the living environment. Don't build it really simple. So you manufacture it, and you do it with a cohort of people, of like minded people in an ecosystem of partners. So this conversation is not about Blink or PT blank. It's about an ecosystem of partners where we do it together and you do it locally. We're not bringing materials and things in from China. You do it better and you don't build it anymore. You assemble it so it's stretchy pulley. Lego is what we're making. So it's a whole new process. We call it if you turn the status quo is design and construct or design and build. We're throwing out the window and calling it DMI design, manufacture, and integrate.

Murray Ellen

A simple way to think about it is grabbing Lego blocks and putting them together. But everyone makes a different Lego block. So we've got about 200 manufacturers in Western Sydney on our list, and we engage directly with about 37 or 38 of them. We go to them and use some software which says that window can be stretched and pulled within bounds. And that's the added value we provide. We put that window on a digital marketplace, and you can drag and drop it around the chassis if you like, or the backbone, like a chassis of a car. And this has been done in automobiles for years, the Aeroplanes, for years. So you manufacture the components and you do it in a disaggregated local way here, using Australian materials, Australian products, Australian people. And yes, in a high value add. I'll use the word factory environment.

Murray Ellen

I wish I had a different word because these factories have breakout areas. It's not a sweaty, horrible place. These are wonderful areas where women prosper, men prosper, and you've got your digital hat on you're using manufacturing components, using high tech jobs, highly paid jobs. And that's what we're empowering at Blink. So manufacture it, don't build it.

Kylie Davis

Awesome. Okay. Angie, did you have anything you want to add?

Andrew Giles

Just to say that I suppose the analogy is to Murray mentioned, you know, the Ptblank technology is part and by the way, we don't build anything ourselves. As Murray said, we empower an ecosystem to deliver the built asset. We provide the technology. Part of that technology is the structure, which is the chassis. The parallel there being to the automobile industry and the rest of it is actually the algorithm to coordinate the manufacturers. That, again, like manufacturing a car, if anyone's familiar with that, you've got your chassis going down the production line, and then your other offsite manufactured parts come together and with precision, join the chassis. Yeah, I guess that's the analogy for what we do. And as Murray said, one of the most exciting things at the moment is that our role is enabler.

Andrew Giles

We're an enabler of the process, and we enable everyone to participate and create more value and get more value themselves out of one of the largest industries in the world. I mean, we contribute to 7% of GDP in Australia. So it's right that in actually satisfying our housing needs, that we also can empower our local manufacturing community to provide that supply. And then it's a win for the whole economy.

Murray Ellen

I love that. It's a win for builders, too, because we got arranged mostly second generation younger people who aren't sitting on top of large organizations. But when they see, hang on, does that mean I can do things high quality, but in half the time? The answer is absolutely yes. So that enables productivity, which enables profit, which means, again, when you look at it as integrating the parts, not building them, it's just a different mindset.

Kylie Davis

So I have so many questions. But I do actually love this idea that I do love this idea that for us to bring construction into the 21st century, we actually have to bring it to the whatever it was when Henry Ford invented the.

Murray Ellen

Let'S get there first, and then we look at getting.

Kylie Davis

It to the 21st century.

Murray Ellen

I get this a lot. I get asked the question, where does innovation come from? I've only got one answer. That's necessity. Go and ask Henry about that. And then the big difference with Henry is just a bloke like me and you and everyone else. Bloke being the derivative word for people, human being. Biggest social change in the world is probably the vehicle. And yet we all participate. We all play in that world. The huge difference that Blink brings, as opposed to Henry, was his catchphrase. We can have any color you want as long as it's black. Now, with computerization and technology and the big shift since Henry Ford's days, we can manufacture any shape. So this is mass customization, not mass production. And we are sitting on it and just not using it. It happens every day.

Murray Ellen

A robot or a digitally controlled machine or a variation heading up to that doesn't care how many different things it makes. It doesn't need everything to be the know as mass production. And if henry ford had this know well VW does. They make a whole range of cars. That's why they can own the world's. You know, it's just an empowerer and why I like the position we've taken. We're not trying to say this is all about Blink. It's not. There's been companies before who have advocated some of this, and they're a vertically integrated company, and it's all about Katira was the name, or they're all about our people. We're not. It's a horizontal system that brings a new tide to all boats, and that's what we're trying to do.

Kylie Davis

Okay? So when we think about manufacturing homes, traditionally we think more of sort of modular, or we think of more that sort of affordable end. What's the difference between a home that's been built using the PT Blink ecosystem versus a property that you would see out in Western Sydney right now being built by Blokes turning up on site?

Murray Ellen

Well, first and foremost, for a variety of reasons, we can go into we've gone to the multi story market rather than the individual dwelling market, mostly to get economy of scale. So we start somewhere around the three to five stories and then go up to infinite number. I'm highly influenced by an American market and an Australian market and a density market, so that individual dwellings you're not changing everyone's minds. I think we will come to individual dwellings later with this process, and probably people will better, much better at it than us. Traditionally, our space has been in that more built form.

Murray Ellen

So we're squarely in the multi story market, and primarily because it doesn't exist, we are not aware of anyone who looks at a multi story building else in the world, although a timber backbone is very similar, and there's multi story timber buildings, and we're materially agnostic. We absolutely love them. And we have manufacturers on our books who that's what they do. They've got to be digitally accurate, though, so everything fits. So what's the difference with us? Primarily, everything is flat packed, so rather than be a volumetric scale, although bathrooms can very much be volumetric, but maybe laundry, so that's debatable. Most things that we do with our manufacturers are flat packed, bit like Ikea, and we call ourselves the Ikea construction. So that everything. You're not shipping air primarily. So even though you're locally manufacturing, your volume wants to stay down to our right.

Kylie Davis

Okay.

Murray Ellen

So having said that, on the digital marketplace, when it's finished, you will see volumetric buildings because it's a choice. So we see that as a manufacturing choice. And I must say, Kylie, when we first started, which business is almost six and a half or seven years old now, everyone said, there's no manufacturing, it doesn't exist, it's all gone to China. So we had to go and look and find I make the analogy to turning under rocks. And there was all these family, mostly family based businesses, who hadn't been sort of taken up with the sweep of make everything in China. And please don't get me wrong, I'm not down on China. I lived in Hong Kong for 16 years or something, and my first station was in China. So they're friends and nothing else.

Murray Ellen

But when you value time, then you value that twelve week or 14 week shipping period, and you value the quality that is made here, and you value a lot of different things.

Kylie Davis

Yeah, sure, Andrew.

Andrew Giles

Look, I might also add to that, and this is with my commercial real estate subcommittee hat on, as well as my PT Bling hat is that it's also not just about housing. So our solution, particularly we're faster, safer, better and less waste is our sort of four key deliverables. And obviously it starts with faster because faster is time and time is money. So for commercial real estate also, we are a great solution because if any industry understands the time value of money, then it's commercial real estate. The faster you get to market, the faster you get to realize your return, your internal rate of return rises and so on. So just wanted to make the point that we're not just residential, we're actually any kind of building typology or asset type.

Andrew Giles

In particular things like if you have a look at sophisticated warehousing now that's popping up around Southwest Sydney and those sorts of things, multi story, high value real estate, but also higher value product lines. And speed to market for those distribution centers is critical. So data center would be the same. So a data center every week is potentially millions of dollars of revenue, either foregone or captured by getting to market quicker. And we haven't actually talked about when we say quicker, what do we mean by quicker? So we're talking about total project time savings in the vicinity of 40% to 60%. So we're not in the realm of 10% and those sorts of things. We're actually looking at a step change in speed. And that's a huge commercial benefits for clients.

Murray Ellen

And Andrew's point is very valid. Kylie because our first building that we actually completed with this was a residential. A lot of people take us down that road first and foremost, data centers in particular. The time value of money is so obvious to those owners. So we say that we can do any architecture, and with our business partners, we can manufacture anything. We put our minds to it. And that's really where it comes from.

Kylie Davis

Kyle so if I was driving down a street, would I know, would I think, oh, that's one of those manufactured properties, or would it be completely invisible to me because they just looks like a modern factory or whatever?

Murray Ellen

On completion, it'll be completely invisible. Matter of fact, we could make some things that aren't possible today more possible, and you might start to aggregate them. But if you look at, say, four and a half years ago, I don't know if you've seen our video, but ten or nine years, got it and put it up there. We had 42,000 hits on our first night and didn't know what to do with them. Kylie we just weren't ready.

Kylie Davis

Scaling.

Murray Ellen

Yeah. Well, here we go. Another little challenge. Not only you got to change payment systems, men's minds, construction, grow yourself. This little land we're in which we're almost at scale up, I still call it startup, but there's always the next. So the fundamentals we came from, or I came from the world of long span structures. So if you look at Sydney Stadium, Australia, the two reconfigurations of my work, at the end of it. We're very good at long span structures, so when we say we can do any architecture in the multi story field, we can, because we come from a totally different background. And that's the whole idea.

Kylie Davis

Let me ask you a question. Are you happy with your current operational workflow? Are you really satisfied with printing, signing, scanning and emailing contracts and then having to wait days for them to be signed and returned? Well, I didn't think so. And I have some good news. There is a better way. Dynamic Methods is the team behind leading real estate industry tech platforms such as Forms Live, Rei Forms Live and Realworks with a mission to make better happen. Dynamic Methods are dedicated to providing efficiency and productivity tools, boosting form technology to real estate agencies across Australia. Each month, 50,000 real estate professionals across eight and a half thousand agencies from every Australian state and territory use Dynamic Methods. Form Technology empowering more than 7.2 million transactions a year.

Kylie Davis

Dynamic Methods is also proud to host quality integrations with some of the proptech industry's most powerful technologies, such as DocuSign, Secure, Exchange, Equifax and more, putting everything you need to get forms and contracts filled in, signed, verified and exchanged into one easy platform. So if you're ready to ditch the pen and paper, make your agency look more efficient, head to Dynamictmethods.com Au Partners to learn more.

Kylie Davis

So, Murray, before you mentioned that you've worked in the industry across 35 countries, what's, 1515 countries?

Murray Ellen

Sorry.

Kylie Davis

How did you get to this point? What's the story behind PT Blink and how you founded it?

Murray Ellen

Necessity and frustration, I guess. The 15 OD countries was with long span structures from Malaysia to Dubai to Tijuana, Mexico to China to the UK, so I can wrap it on always with partners. So we always had a key technology that we dealt with the end user. If I mentioned someone like Boeing needed aircraft hangers. We had a technology that's very good for aircraft hangs, but went directly to Boeing and said, look, you sure this is what you want? Why not look at rather than the tender you have out? Have a look at maybe them building a single 737 hangar. Do a double or a triple because it's so much more productive. 25 or 30 years selling productivity, really, in that space. Came to a bit of a head with a business decision.

Murray Ellen

Actually, it was a builder who went broke owing us money and lost a little bit of a stride to you the truth, Kylie, because just no fault of our own end up in a fair bit of strife, which we got out of. But then you start to rethink. And what happened was our friends from One Steel, one of two Australian steel manufacturers, asked a key question, and that know, Murray, you must know you lived up there how do we compete with China? And then the second one was a property developer. My naming is Tony John in Brisbane. The Anthony John group. We had done a lot of work for some really innovative structures. He was a very know property developer. I don't know how many we did together, but a lot of clear span things.

Murray Ellen

And he asked me, why can't we buildings fast like they do in China? And to me, I was there as a 22 year old. I'm a bit older than that now, Kylie. It's a few more scratches on the back. Right. But it was just incredible that China would be leading when were following from the mindset that I grew up with. And I said, of course we can. We just got to put our minds to it. And that was the starter blank those two key. That's that's where it started.

Kylie Davis

Andrew, you want to add something?

Andrew Giles

Well, if I can jump in there again. In meeting Murray, that got me excited about getting involved with PT Blink. One of the things that I guess touch on just in the background of our name, PT Blink. The PT comes from Murray's work in post tension steel. So for anyone who goes out to stadium Australia and for a rock concert or a sport event over the Women's World Cup recently, I confess to spending a fair bit of my time looking skyward.

Kylie Davis

You were supposed to be watching Sam.

Murray Ellen

That's what I told him to do. Andrew. I got to jump in. That has changed. I reckon what happened with Matilda helps us change construction.

Andrew Giles

Yeah, absolutely.

Kylie Davis

Tell me more about that. Why is that?

Andrew Giles

I suppose just finishing that point. The roof is the post tension steel that now informs our structural technology today. But getting to Murray's point there, one of the mission points is obviously diversifying the workforce. So, again, I read that I think there's currently participation of women in construction at the moment is 12% in Australia. It's probably similar in the US, I would say. Female participation is obviously a big opportunity as we then move into more of a technology based, value adding workforce rather than the nail bags and carrying the wood and those sorts of things. And it doesn't stop at female participation either. It is an able bodied, male dominated industry currently. So, again, getting people that might have physical limitations now involved in the industry is also look at this.

Murray Ellen

If we look at for any change, I think money needs to be empowered, right? So if we're going to have I get the trouble for this because I say things like, you can't just legislate for green buildings. If there's a driver, there's an economic driver to economate for green buildings. You can do it. We just saw it with the Matilda. Okay, so channel seven, right? Channel Seven got it wrong. There wasn't one. It wasn't 750,000 viewers, as they thought. And they let optus outbid them for the rights that one night there was something like 1.8 million viewers or 7.5 million people watched the Matildas, and that is driving economic change. So with economic change, you're now going to have a whole new industry, I think.

Murray Ellen

Well, the other half of it should have happened ages ago, but with that fiscal driver, and I think that's what the construction industry that's what Blink's about. It's about what we do at Ptbank. It's about that economic driver. And with that economic driver, there'll be more green buildings. Why? Because the funding needs to come from green sources. Why? Because my Toyota Ute has zero point 25% waste, not 30% zero point 25% waste. So 38% of our global emissions comes from our industry. We got to wake up. And I just saw the Matildas wake up. A nation. That's all I'm saying.

Kylie Davis

I think, Too, we're at that tipping point that people are starting to finally wake up too where the digital disruption across all of our lives has led us to question if you can do things so quickly and easily on your phone. And the data supply that's out there now or the data that's out there now can start to personalize everything so quickly. Going back to old processes feels even more clunky than it did five years ago or ten years ago.

Murray Ellen

Right, I agree.

Kylie Davis

We're demanding it.

Murray Ellen

We demand it. So why did I ever warm to Uber? And I'll tell you, it wasn't in my case, it wasn't because it was cheaper. I had four younger kids from home, I was traveling a lot to the US, to Europe, big businessmen, all that sort of stuff, right. But if that silver service cab wasn't out the front from St. Ives to the airport, which is $120 fare, if it wasn't there, I was in trouble because I didn't know how my family was, I didn't know I was going to make the plane and when it's coming back. The same with Uber. I could see it. So it gave me surety. And I think that's what PT Blank is doing to the industry. While we talk about time, there's a whole feeling that time is cheap. If it's fast, then it's no good.

Murray Ellen

Well, sorry, time is surety. Time is knowing it's going to happen or seeing it's going to happen that's I think the key to transformation is the clarity, the transformation that you're going to get paid, the transformation that you can come down to the local factory and you can choose your kitchen individually, or you can come to the local data center. There we go. I'll shush now. Colleague.

Kylie Davis

No, that's all right. But I think this whole transparency of being able to see it, I know we've built and renovated places ourselves, and this whole waterfall notion of it's quite a small renovation. Doesn't look like it's very much on the adding, quite a small space. But the way. That it's going to re change the space. Why did that need to take nine months? Well, it took nine months because they would turn up and do a little bit and then they'd spend half the afternoon cleaning up for the bit that they did and then they would, the next day come. We should order some materials and then we'd wait two weeks for the materials. Just doing it at a wholesale level sounds awesome.

Murray Ellen

Can I just stop there for one tick? Right. Imagine that on a 30 story building and the process is exactly the same. And this is what people don't see in the sun. To change that fundamental at your place, I'd like to make the thing in a factory and you can come and see it and you can choose it. And then digitally you'll get the 3D image and you can say this, that and other thing, but what we don't do is play on you to change your mind. If you change your mind on a 30 story building, then sorry, here's the extra bill and here's the other. The downside of manufacturing is when we say go, I want that it's all manufactured. So the concept that a client can change their mind up to push the button to manufacture for sure, push that button.

Murray Ellen

No, that's what you're getting. And you see it in 3D lighting, you see it visually. I'm sorry, I just wanted to get that fit in. How big are we? Look, we're bigger than Bernhard. I don't know how you think in terms of being in terms of people size, expansion people directly and indirectly. We'd have about 22 or so on Southeast, direct and indirect directly, including software programmers, including others. But our reach goes a lot bigger than that because we like to use the word license or partner. So if we have real projects on, we don't do the engineering we use. The appropriate person will be a structural engineering firm, if it's for structure, mechanical for others. So we have learned to do this over the years and we've applied it to blink.

Murray Ellen

So architects, blink authorized architects is a little bit of different thinking engineers. So revenues this year, next calendar year will be somewhere between five and seven and a half million dollars or so. So that's from real thing. But we're always in a perpetual sort of we've been raising capital since we started and we're doing a fairly large capital raise at the moment to jump the software to the next level. And now we've tested and doing things. So that's pretty much where I don't know if that answers your question, Kylie, but I can answer anything on that.

Kylie Davis

I think we're kind of at that tipping point too, around the whole data side. The pain of continuing to do things the way that we've always done them overlaid with this new expectation of personalization and customization, requiring individuals to just work harder using the same tools that they've always had. We're at that tipping point now, aren't we, where we're seeing that's just not real. Like, you cannot ask people to work in the current broken system harder and harder to deliver better experiences as an alternative to embracing the tech and making everybody's life easier.

Murray Ellen

You're exactly right. We're at that tipping point. I actually think we're way past it. And what I'd cite there is it seems that in this industry, that change, particularly Australia, US, is a bit different, in my opinion. But change only comes when there's a cris. So you look at the number of building companies going broke in Australia right now, and yet everyone doesn't. It takes a company the day before going broke to say, what do we do? How do we change? I'm not going to name big names, but everyone knows them in the industry, they're well published. And what I've also learned is, unless you live the life, you don't really know what happened.

Murray Ellen

But what I do know is the system is rotten from the core when it's basically becoming a Ponzi scheme, where you're taking from an old project, got to win the next one, got to win the next one to keep that one running. And maybe I shouldn't have used the word Ponzi, but there you go.

Kylie Davis

When.

Murray Ellen

You can say, well, hang on, my margins are so skinny, I'm one and a half or 2% margin. Therefore, there's only one way to make money, and that is either charge my subcontractors more for what might be perceived as their failings, or get my client to make a change. But until something dramatic happens, it seems that this industry, the tipping point, I reckon, was about a year and a half or two years ago. That's why they were still tipping over the edges. So this embracing with technology, having said that, when people do it, when we see companies who were actually do it's like hallelujah. And I'm not saying it's a smooth road because there's change and it's pretty much the only thing that's been the stable thing in my life and that has been change. It's the rate of change.

Murray Ellen

So I think the tipping point's probably over. We can come back, but I think it's.

Kylie Davis

Look, you know what, Murray? I remember Too speaking at a property a build conference a couple of years ago before COVID Too and someone from one of the building organizations might have been one of the unions, basically, that was trying to work in. This area of builder health and was basically trying to the concept was about how broken the business model was of having this vision of what this property is going to look like and then the business model of construction. Being. So this is how I want it to look. And I'm going to bring in all of these people.

Kylie Davis

And at every single stage, everyone's trying to going to try and take their cut and deliver it for the most effective and affordable way for them to deliver it, so that by the end of the thing, you've got this shiny vision and then you've got what actually gets delivered sort of down the bottom, which doesn't often look like each other. And she was saying that this model of subcontractors was so broken that if we turned around and were real as an industry and said, well, it's going to cost you 40 million to build this building, and we're going to have to lose seven workers. They're going to die as a result of that because of the safety issues and also the whole stress and anxiety and mental health issues around of that pressure of delivering to impossible deadlines. Right.

Kylie Davis

Contracted impossible deadlines, and how damaging that can be to the industry.

Murray Ellen

Yeah. Look, Kylie, it's not just unions. I mean, I'd be one of the strongest supporters of unions to change the way things say. It's not just unions, it's the system. And when you say it was endemic to change what we talk about there, and that's exactly right. You've got margin on margin, on margin. That comes to my mind from big glossy image done by architect who as soon as 10% design is done, maybe ten or 15% design is done, then owners or developers of property, throw that out to three builders or three or four builders and say or their buddies and say, look, finish this design and give me a build price. Fixed price. It's just ludicrous. And that's what they've been pampered to. And I'm not saying developers are right or wrong, but they've been sold on risk.

Murray Ellen

We'll take your risk away from you, Mr. Owner. Sorry, who benefits from taking the risk? The owner does. So if we're going to take risk away, then we've got to look at risk differently. Right? So if I can manufacture a whole bunch of assemblies out of the weather in environments with high tech workforce that exist today, and you can improve today, you just took the weather out of the equation and then you're saying? Well, you just took a bit of a few other problems out of the equation. Such as? Quality an issue because you're inside and you look at a bathroom, it's got eight separate trades who don't turn up on time and who don't turn up.

Kylie Davis

In the right order.

Murray Ellen

But why are they doing it? Why did they do it to you, Kyle?

Kylie Davis

They're balancing.

Murray Ellen

They're like this juggling match of trying to keep the cash coming in from you and don't admit it, don't say to you, I can't come, Kyle's, I can't come because I've always got another excuse. Oh, this one's much bigger, or this one's much more important. I can't get to yours because I'm juggling. They're juggling. It's just a big juggle. A big juggle that has to stop.