Cementing a corporate mix: Ottawa's Giatec Scientific partners with German giant on R&D, financing deal

Giatec co-founders
Giatech Scientific co-founders Rouhollah Alizadeh (left) and Pouria Ghods. Photo courtesy Giatec Scientific

An Ottawa cleantech company that’s on a mission to make concrete more environmentally friendly is hoping a cash infusion from a European building materials powerhouse will cement its status as the global leader in its field.

Giatec Scientific announced Tuesday that German multinational HeidelbergCement, the world’s second-largest cement manufacturer, has made a “minor strategic investment” in the local firm.

Financial terms were not disclosed, but Giatec co-founder and CEO Pouria Ghods says the new partnership will give his company the financial heft to create a platform that’s even better at helping concrete manufacturers produce higher-quality building materials while doing less harm to the planet. 

Concrete manufacturing currently accounts for about eight per cent of the world’s carbon dioxide emissions.

“It will enable us to have the best-in-class AI-based software to reduce the carbon footprint of this industry,” Ghods explains. 

Founded in 2010, Giatec specializes in developing wireless sensors that use artificial intelligence to measure the quality and consistency of concrete during the construction process and beyond.

The company's devices are now deployed on job sites in more than 80 countries. Giatec appeared on OBJ’s list of fastest-growing companies in 2018, and it finished in the top 100 on Canadian Business magazine’s prestigious Growth List in 2020, with five-year revenue growth of nearly 1,400 per cent. 

After pandemic-related headwinds held it back for a couple of years, Giatec is on track to exceed its goal of 25 per cent year-over-year revenue growth in 2022, Ghods says.

$5M in federal funding

Now at 91 employees, the firm received more than $5 million in federal funding last summer to help it scale up. 

But Ghods says in order to keep growing, Giatec required another source of capital and found the ideal partner in Heidelberg, which operates in nearly 60 countries and runs more than 1,500 ready-made concrete production sites around the world.

While the extra funding will no doubt boost Giatec’s R&D efforts, Ghods says the new deal is as much about data as it is about dollars.

Heidelberg was founded in the 1870s, meaning the Ottawa firm’s software engineers now have access to a treasure trove of information dating back nearly a century and a half – including what materials have gone into its cement, how the recipes have evolved over time and how those changes have affected the quality of the resulting concrete.

"AI without data is meaningless. They have a gold mine there. Our job is to extract it."

One of Giatec’s recent innovations is a web-based dashboard called SmartMix that uses AI algorithms to help concrete producers calculate the ideal amount of cement and chemical additives in their mixes in an effort to cut down on material costs and greenhouse gas emissions.

For example, Giatec is now using machine learning technology to figure out how to minimize concrete’s cement content by swapping in materials with a lower carbon footprint such as slag, a waste byproduct of iron smelting, while maintaining its strength and durability.

Giatec’s researchers plan to use Heidelberg’s data to make the firm’s patented AI even smarter as they continue to refine the software.

“I believe we are a major step closer to revolutionizing the concrete industry in a sustainable manner,” Ghods says. “AI without data is meaningless. They have a gold mine there. Our job is to extract it.”

He also hopes joining forces with one of the best-known names in the business will help convince more customers in the traditionally risk-averse construction industry to make the leap and sign on to Giatec’s platform.

“Adoption is not happening very fast,” Ghods says. “That's part of the problem. Having a big player with a big footprint internationally, we believe that will help us to accelerate the adoption of solutions we already have and also new ones we are going to offer to the market.”

The CEO is already pondering how his company will celebrate hitting the 100-employee mark, a milestone it expects to achieve by the end of its fiscal year in July. Even though Giatec is now casting its hiring net abroad in an effort to land skilled talent in today’s tight market, Ghods says the firm is committed to growing its operations in the nation’s capital.

“We are proud to keep it Canadian and in Ottawa and hopefully we can make (it) a big success,” he says.