Dili raises $21.7M to bring AI compliance to US infrastructure projects

{ "title": "Dili raises $21.7M to tackle construction compliance with AI", "body": "Dili, an AI compliance company targeting the tangled web of rules governing US construction projects, has raised $21.7 million in total funding. The company announced a $15 million Series A round on Thursday, adding to a previously undisclosed $6.7 million seed round.\n\nThe Series A was led by Khosla Ventures, with participation from Allianz, Rebel Fund, Darren Bechtel of Brick and Mortar Ventures, and Garry Tan of Y Combinator. Dili was part of Y Combinator's Summer 2023 batch.\n\n## The compliance maze\n\nDili's software focuses on the unique set of compliance rules that apply to construction projects, especially those receiving federal funding. These include Davis-Bacon rules, which allow the Department of Labor to set prevailing wages, and separate prevailing wage and apprenticeship (PWA) rules that apply to clean energy projects funded under the Inflation Reduction Act. OSHA and EPA rules may also apply depending on the nature of the work.\n\n"Non-compliance can result in millions of dollars of fines for those projects," said Anand Chaturvedi, co-founder and CEO of Dili.\n\nThe stakes are high, and the requirements are complex and overlapping. Dili's software is designed to help contractors and project owners navigate this maze. A single error can cost a contractor $330 per day in penalties, and fines can quickly escalate to $100 per worker for each violation, adding up fast on large sites.\n\n## How Dili uses AI\n\nDili uses artificial intelligence only in its data layer, converting unstructured documents into structured data. A deterministic system then sorts that data according to static compliance rules. Chaturvedi believes this architecture will prevent the kind of fuzziness that can come from relying solely on large language models.\n\n"So it's really powerful to be able to check all the information as it comes in, instead of just sampling data," Chaturvedi said.\n\nThe result is a task that once took a full day now takes minutes. Dili's software is currently used at about 700 projects, ranging from manufacturing facilities to data centers. The company was founded in 2012, giving it over a decade of experience in the compliance space before pivoting to AI.\n\n## Software versus services\n\nRoughly half of Dili's customers use the software as an in-house tool, while the other half outsource the entire compliance process to Dili on a contractor model. Chaturvedi anticipates the industry will shift more towards the software model in the years to come.\n\n"Software and AI are going to start eating a lot of those professional services workflows, so I think more and more people will start to bring those in-house," he said.\n\n"The interesting thing will be how the market itself evolves and where the customer needs go as AI develops," Chaturvedi added.\n\nHe described the power of the system as being able to "imagine being able to read across the entire context of a company's internal documents, all of their vendors' documents, all of their ERP information, all of their payroll systems information, and then draw out the data that you need specifically for you know reporting or compliance."\n\n## The bigger picture\n\nMaking AI work requires new data centers and power infrastructure, which in turn require massive construction projects. Those projects come with their own compliance burdens. Dili is one of a growing number of startups pitching AI for compliance, but the company targets a specific and high-stakes niche.\n\nThe article was written by Russell Brandom, AI Editor at TechCrunch, who previously worked at The Verge and Rest of World, and has written for Wired, The Awl, and MIT's Technology Review. He can be reached at russell.brandom@techcrunch.com or on Signal at 412-401-5489.\n\nTechCrunch Disrupt takes place October 13-15 in San Francisco.\n\n## Related on Neura Market\n- AI and Infrastructure: The Compliance Challenge\n- Construction Tech Startups to Watch\n- Y Combinator Summer 2023 Batch Companies" }