Edi and Etrit Demaj, two brothers who fled violence in their native Kosovo over twenty years ago, were greeted by the iconic New York City skyline upon arriving in the United States as young immigrants. The towering buildings left a lasting impression on the brothers, who have since built a successful life in America with their family.
“The first building that we saw was the Empire State Building,” Etrit reminisces.
After settling in Detroit, the Demaj brothers completed their education and founded several companies, including their latest venture, Kode Labs. This innovative company focuses on integrating and automating systems in commercial buildings, including the very one that first caught their eye: the Empire State Building.
“That’s the American dream,” Etrit proudly states.
The central aim of Kode Labs, founded in 2017, is to bring building management into the modern, cloud-based era. This involves developing sophisticated software that can collect and analyze data from various internet-connected components of a building’s operations, such as air handlers, fire alarms, elevators, and occupancy sensors. Kode claims its software can seamlessly integrate with over 130 different systems.
The brothers compare their software to a building’s operating system, similar to how a computer’s OS manages different circuit boards.
“We’re essentially bringing in data, organizing it, and using it to create applications that enhance the operating system. This results in increased efficiency, energy savings, and a better overall experience,” Edi explains to TechCrunch.
In addition to streamlining building operations, Kode also offers a range of applications for its platform. These allow customers to monitor energy usage, track carbon emissions, and monitor water consumption. Not only do these features help reduce costs, but some data is necessary for compliance with laws in different cities. For instance, New York City’s Local Law 97 requires buildings over 25,000 square feet to cut their carbon emissions by 40% by 2030.
“With all the current goals and regulations in place in various locations, building owners have no choice but to continue in this direction,” Etrit notes.
Kode’s software is currently used by building managers and owners on five continents, and its impressive list of clients includes Fortune 100 companies and prestigious higher education institutions. What’s more, the company has been profitable since day one and boasts a whopping customer retention rate of 0%. Annual recurring revenue has also experienced impressive growth, increasing by 200% each year for the past three years.
Kode’s business model is comparable to that of Salesforce, according to Edi. Customers pay an initial implementation fee, which is based on the size of their property portfolio, and then recurring fees based on the amount of square feet under management and the number of applications utilized.
Since completing its $8 million Series A round in 2022, Kode has experienced significant growth, with over 40 employees in Detroit, 150 in Kosovo, and several more in different countries. Feeling the momentum and recognizing an opportunity to expand quickly, Kode recently raised a whopping $30 million in its Series B round, exclusively reported by TechCrunch. Leading the investment is Maverick Private Equity, with participation from I Squared Capital and Telus Ventures. The startup plans to use the funding to continue building its app marketplace and advancing its use of artificial intelligence to optimize building operations.
