KP Unpacked

AI Meets AEC: The Chaos Behind the Disruption

• KP Reddy

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The future of AEC isn't just about AI disrupting the status quo—it's about AI accelerating innovation and transforming the way we approach design, construction, and operations. In this episode of KP Unpacked, KP Reddy and Jeff Echols dive deep into the disruption happening in the AEC industry, focusing on how AI is changing the game and why staying stuck in traditional ways isn’t an option anymore. See the original LinkedIn post here.

How are industry leaders using AI to their advantage? What’s holding the industry back? And how can firms break free from outdated processes to embrace smarter, faster ways of working? This episode uncovers the practical steps to understanding the impact of AI, and why it’s crucial to adapt now.

They Discuss: 

  • Why AEC is stuck in the past—and how AI can help us break free
  •  The real potential of AI to enhance construction—not replace it
  •  How tech disruptors are challenging legacy players and pushing the industry forward
  •  The truth about "managing risk"—and why it's not as simple as it seems

Each episode provides insights and actionable takeaways that’ll make you rethink the future of AEC.
Drop a comment with your thoughts, and let’s continue the conversation on how AI is changing the industry. 

🎉 Special Offer for KP Unpacked Listeners: Get 55% off your ticket to the 9th Annual AEC Summit on October 29th at the Diverge Innovation Center in Phoenix! Click the link below and use promo code UNPACKED55 at checkout.

🔗 9th Annual AEC Summit

Don't miss this opportunity to connect with top minds in AEC and beyond. Tickets are limited—act fast!

Speaker 1:

Hey, welcome back to KP Unpacked. My name is Jeff Eccles, I'm a Senior Advisor at KP ReadyCo and this is my opportunity to sit down with KP Ready, who is the CEO and founder of KP ReadyCo, Also the founder of Shadow Ventures. This is my opportunity to ask KP. Once a week I get to do this. It's the only time I get to ask it and basically I get to do this while we're recording and we're live on camera, so he really can't react in any other way. I'm like KP, what were you thinking? What were you thinking when you posted that on LinkedIn? So, as I mentioned, I'm joined today by KP Reddy. Kp hi, how are you?

Speaker 2:

Hey, how's it going.

Speaker 1:

It's going really well. You hey, how's it going? It's going really well. The post that we're going to talk about today is, as always, it's a good post. It's an interesting post. We were talking before we went live. I just spent the last hour recording with Frank Lazzaro on our team about unpacking AI and this is, for me, feels like a little bit of a continuation of that conversation, and this is, for me, feels like a little bit of a continuation of that conversation. But, as we were saying, this post got a lot of responses and I think it's going to become obvious why I think it's important. It's short, but I think it's a really important.

Speaker 2:

I also got a lot of messages right. There are a lot of people wanting to spar with me, which I never shy away from a good fight. Okay, I never shy away from a good fight.

Speaker 1:

Okay, well, so what I wasn't prepared to announce. But what we are planning is we have rented a ring in downtown San Francisco for actual cage matches, you know, I did train on my sabbatical.

Speaker 2:

I trained MMA for almost like a year.

Speaker 1:

Okay, well, that's going to be Well they told me I was too old.

Speaker 2:

basically they're like you're 42 years old. What should take two hours to recover is taking you two weeks. You need to stop, yeah, and they're like oh, and, by the way, you take hits really well I think was that a compliment Like you're really good at getting hit.

Speaker 1:

That was. Was that a compliment? Like, you're really good at getting hit that that was. That was not a compliment, just so you know. Just to clear that up for you. But, um, so keep your eyes out for kp in the cage coming to san francisco. If you're not following kp on linkedin, you should be. You probably can't connect with him he's usually maxed out on his LinkedIn connections but you can follow him. He posts several times a day and all those posts come from conversations that he's having, things he's observing as he does advisory work, as he's on the speaking tour all around the built environment, all around the AEC world, the clients that we work with that are shaping the built environment, and all of his posts are insightful, they're pot stirring, they're things that you should be paying attention to. So follow KP on LinkedIn.

Speaker 1:

Just look up KP, letter K to letter P, and then ready R-E-D-D-Y, you'll find him. You hit the follow button and you, too, will be able to see the posts that we talk about, that we unpack here on KP unpacked. So as we record this, let me check the calendar. You must've posted this on about the 11th of March 2025. So if you're listening to this in 2028, go back a few years, go to March 11th, and you'll find this post.

Speaker 2:

Hopefully LinkedIn will still be around.

Speaker 1:

I don't think LinkedIn will die. It's like the cockroach.

Speaker 2:

It'd be a shame for me.

Speaker 1:

It would be.

Speaker 2:

The only friends I have are on LinkedIn.

Speaker 1:

You're getting a lot of inside baseball here today. Folks, kp's fighting in caves, he only has friends on LinkedIn and I don't know what else. Um, a lot, a lot of insights you weren't expecting. All right, this post goes something like this in the world of aec, ai disruption, it's the people that are in denial that won't see it coming. Things move slow until they move fast. Being dismissive about quote, ai isn't ready, or hallucinations, or who will stamp the drawings, or my innovation team is doing AI, are all leading indicators that you are focused on the wrong things, that you are focused on the wrong things. Yeah, this one.

Speaker 1:

I had a conversation from outside of this industry that would fit. I actually thought about sending this post to somebody you know a lot of that's not relevant to them because they're way outside of AEC, but these are the types of things that we hear a lot. I would say it felt to me, as I was having that conversation earlier this week, thinking to what we do see in here all the time. It's like ah, I thought most of these conversations were like so 2022, but they're still happening. It's 2025. They're still happening. So it's not hard for me, and probably all of our listeners, to guess. But where did this come from? What was the inspiration for writing these few sentences here?

Speaker 2:

Well, one, I think you know I deal with all these CEOs right and they say like, oh, we need to disrupt ourselves before we get disrupted.

Speaker 1:

Pretty common phrase.

Speaker 2:

That's never worked. No phrase that's never worked no. Right, it's never worked.

Speaker 1:

We like to see it though.

Speaker 2:

It's nice to say yeah, and I think it's this dismissive attitude like AI isn't ready, so you just got to put it. It's like early days of the internet, when we had 14-4 dial-up modems and things were very slow, right. We might've said like, oh, we're very slow, right. We might have said like, oh, the web is so slow, this will never go anywhere, right. And what I'm saying is like yes, there are one. Most of what people are using is what I consider consumer grade AI.

Speaker 1:

Oh, absolutely Right.

Speaker 2:

The stuff I play with is definitely not that.

Speaker 1:

It's different, it's very different.

Speaker 2:

So I think I'm like maybe a couple degrees ahead of people just because of the things that I get exposed to. So I have a little bit of a bias there. But I think if you're just dismissive of like, oh, it hallucinates, it'll never go anywhere, like you were going to get so blindsided, it's not going to even be funny. And if you're really saying I'm going to like, as a CEO of a firm, my team is working on it and you're not checking in with them every day, like we're having a conversation, how, like, social media trends change every day and all that AI things are happening every hour, and if you're a CEO and you're doing your check-ins with your innovation team on AI once a month, once a quarter, you should be fired Like just outright. If I was on your board, I'd fire you.

Speaker 2:

That is like a daily standup. Hey, I want to know. I want to know every day what's changed, what's happening, what are we trying, what are we doing? What to know every day? What's changed, what's happening, what are we trying, what are we doing, what's the progress, what's working, what's not working. But if you start off with like, oh, it's not working, and I'm just gonna put it over here for a minute and come back to it in a year. That's way too late. And I think it's this idea that, oh, I don't want to be an early adopter, I don't like, if you're not an early adopter, of ai, the, there is no adoption, there's no like. You know, we talk about early adopters and laggards and all that, and then, like that valley of death, the chasm. That chasm is very wide. You're either an early adopter or you're dead. There's no phases in between.

Speaker 1:

Yeah, it seems to me, you know that the example of oh, it hallucinates, we're not going to use it, that one resonated with me. The image that popped into my head was because, again, these are tools. Right, these are tools. We need to learn the right tool for the job, how to use the tool, et cetera, and that what you just said about it hallucinates, we're not going to use it. Immediately. I went to the hammer and nail. Right, because we talk about that. Right, how's it go? Every hammer is looking for a nail. Or, when you've got a hammer, everything looks like a nail. Yeah, you know the idea that, oh, the hammer bends nails.

Speaker 1:

For those of you that have never worked on a framing crew, yes hammers absolutely bend nails if you're not using them properly, right right, just because the hammer bends the nail doesn't mean we don't use the hammer. It means that we learn how to use the hammer better. And then you know there are outliers, you know, of course there always are. You know there are outliers, you know, of course there always are. You know, maybe we hit something, maybe whatever. But yeah, we, we have to, we have to learn. We have to understand the problem statement. We have to learn understand the problem to to find the right tool, learn how to use a tool, apply it.

Speaker 2:

And I think you know I have this. You know, of course, you know I invest in startups. I think gosh, I think we're closing on like three deals this month. We're very busy on the investing side and continuing to our investment side's growing. I mean honestly, you know, like my world right now it's like.

Speaker 2:

I'm doing 80 things just trying to keep up. So everything seems to be every every cylinder is hitting right now, but so it's very busy. But what I'll tell you is I had this saying with startups right, I'm not interested in SaaS companies that have an AI feature. I'm interested in AI-first companies that have SaaS as a feature.

Speaker 1:

Right.

Speaker 2:

Right and I think if you take that and put that on AEC firms, I'm not interested in if I'm an owner, I'm not interested in talking to architecture firms that have AI as a feature. I'm looking for AI firms that have architecture as a feature. That's where we're going Right. So that's the shift, and and it's very, it's almost impossible to make that shift just like this. The startups I'm dealing with, right, they're like yeah, we added this ai feature. By the way, why does everybody call their ai chatbot a a female name?

Speaker 1:

I don't know I saw a comedian doing a bit on this recently.

Speaker 2:

I can't repeat it so yeah's kind of funny, right, like okay interesting. But you know, I think you know, oh, we added a chat bot to our construction management software.

Speaker 2:

I'm like no one cares. Or hey, I can use a chat bot. There's a startup out there like, oh, you can use a chat bot. There's a startup out there like, oh, you can use a chat bot to talk to your contracts. Well, I have a lot of friends in the industry. Zero of them woke up this morning and said I wonder if I can talk to my contracts? Zero people did that this morning.

Speaker 1:

Right.

Speaker 2:

But it's all this weird feature stuff that people are doing that's just a waste of time, right, and these companies are getting funded and everybody will lose all their money, and that's just how it is right. In fact, I was playing with Mistral AI. They had their new OCR image recognition stuff. It like will demolish about half of the startups that have been funded in the last year.

Speaker 1:

Wow.

Speaker 2:

You know the startup's like oh, you can like read contracts using our AI. Like done Mistral, does it for free. Like you know, try to convince a contractor pay for something that they could get for free. Right, so I think this transition from I'm going to be architecture using AI as a feature to I'm AI using architecture as if the architecture is my feature. That's not a transition. That is a separate company.

Speaker 1:

Right, right, which gives you a little bit more insight baseball.

Speaker 2:

All these CEOs have come to me and said, KP, can you go start? Can you go start our alt company that competes with our core company?

Speaker 1:

Yeah, don't you think the ultimate or the fundamental problem, right, that we're going to be in an architecture firm that adds on the AI feature? We've seen that before, right? We're going to be an architecture firm that adds on AutoCAD, that adds on CAD to keep it, you know, non-denominational. I guess we're going to be an architecture firm that adds on BIM. That type of approach has always been about what we're doing in-house. It's always been about our efficiency.

Speaker 1:

You know things like that rather than our value proposition. You know things like that rather than our value proposition, rather than how we're creating value for our owners. So it becomes this add-on that nobody cares about, especially on the client side, versus if we did actually have an add-on that we fully integrated and and you know, understanding and not disagreeing with what you're saying it's very, very hard, yeah, right, to take a legacy 30 year, a hundred year, 10 year, whatever firm and say, well, we're going to, all of a sudden, we're going to completely switch gears and become this thing that we weren't previously. That that's, that's. That's a very steep climb, but I think I think that's where it starts is the add-on has always been about us on the, on the firm side, rather than about creating value for our owner yeah, I think so.

Speaker 2:

You know you always mention on the on the bundus pod that, like you know, follow kp, uh, on linkedin, I think also follow our company page, because what I'll tell you is I post on my personal stuff. I would say it's engagement, it's quippy not a lot of actionable items on my LinkedIn posts, right. What I do on our company page is I post things that are a little bit more actionable. So obviously, you know, jeff, you can tell people where to find that, but I published this thing on our company page. It's very relevant to this conversation and I called it the DTD innovation journey, which is digitization, transformation, disruption.

Speaker 2:

So it's like yesterday and I said digitization, paper to computer files, excel, cad, workflows are the same. Business model is the same. The client experience is the same, right, I don't care if you're drawing on Vellum or using AutoCAD, customer doesn't care, right? Then I said from there you're going to go to transformation. Transformation is computer files, other things. So, like application layer versus a file layer, workflows vary. Business model is the same, client experience is enhanced, right. With bim I can show you a 3d model, blah, blah. It's enhanced. It's not different, right, it's just a little bit better right with disruption, your applicate.

Speaker 2:

You go from applications to starting a new company right, you have to start a new company. Do over, right? Yeah? And for the new co, it's kind of like netflix amazon. I mean, could barnes of noble sold books online and become amazon? No, too busy managing their core business. Same thing, netflix. Could blockbuster really become netflix? The answer is no. The answer is no. We can say, oh, they missed the boat. Yeah, I mean, they could have invested in Netflix when they were a $15 million valuation. That's a big miss. But that's a capital allocation miss. It's not a business model miss, right. And so for disruption, the workflows are different, the business model is different, the client experience is different because it's a different company.

Speaker 1:

Right.

Speaker 2:

And so I say the fallacy in AEC is we can disrupt ourselves before someone else does. My answer is that is not true. You can either be part of or start a new company or not. Right, right. So could a blockbuster have started a new company that did streaming and allocate money? Yes, they could have and they should have. If you're a structural engineering firm, if you think you're going to transform, disrupt your own business, it's probably wrong. You probably need to start a different company, go head to head.

Speaker 2:

And go head to head. Right, go head to head. That's what it is. If you want to disrupt yourself, set up a new company different metrics, different strategy, different everything and, most of all, different client experience. Yeah, and I think that's where, like the oh, everyone's missing the boat.

Speaker 1:

Okay, Hot take. Is anybody going to do it?

Speaker 2:

What's that?

Speaker 1:

Is anybody going to do it?

Speaker 2:

I'm getting calls. I'm getting calls. A lot of people are saying well, here's what I'll tell you. Nobody disagrees with me In private session. 0% of the ENR 1,000 CEOs I don't talk to all 1,000, whatever the sampling size is in there 0% of them disagree with me. A hundred percent of them do agree that they can't do it with their own teams and they can't do it in their own business.

Speaker 2:

So they're kind of and they're not sure if they can or want to. It's kind of a personal choice. If I'm two years from retirement, I'm like hey.

Speaker 1:

I'm going to sell the private equity.

Speaker 2:

I'm going to get the hell out of here. That's one option. Get the hell out of here is an option. But I'm having several of them coming to me like, hey, can we joint venture and start an AI-first company with you?

Speaker 1:

And I'm like.

Speaker 2:

I'm listening, I'll talk to you. I'll talk to anybody. You know that.

Speaker 1:

All right, reach out to kp ready. You got to follow him first on linkedin.

Speaker 2:

Yeah, kp reddy yeah, and follow the company page because I am going to start it's almost like my, my personal stuff. It's like I said, it's fun, it's interesting, it's to get you thinking. I don't give people a lot of answers though, I just give them more questions yeah yeah, company page I'm trying to add more answers like here. Here's how to like actually go do something right, yeah, I mean, there is that right.

Speaker 1:

This is that's the purpose of of this particular version of the podcast. Right, is us stirring the pot? Um, you know, looking at it from 30 000 foot view, etc. Frank and I were talking about this as we were. We're recording earlier the ai unpacked version. It gets, it gets more, it gets actionable. We have takeaways at the end of, or action items at the end of each of those episodes. So go over to the KP ReadyCo LinkedIn page and I'm not going to try to tell you what the URL that is, check the show notes Producer will drop links to the things that we talk about in the show notes and you can just go down there and click it. But there, on the KP ReadyCo company page, you will find a different sort of content produced by KP and others on the team. You'll find some of the research we're doing and some of the other things that we're doing, but there's definitely a different flavor over there on the company page.

Speaker 2:

Yeah, and I think Frank does a good job. Some of the stuff that I post short form, he's like, hey, that's a great idea, let me flush it out, and then he turns it into a downloadable white paper that you can. Actually he just did one on monetizing your innovation journey, which was basically came out of some of the workshops that I do, and it's like he took like my 10 bullet points and turned it into an actual actionable document toolkit.

Speaker 1:

so definitely yeah, now that url will also be. Or the url to the page on our website where you can find those downloadable white papers. You find that link in the show notes as well, but that one's a little bit easier. Go to kpreadyco slash research. That's only a couple of words long. The LinkedIn URL is a different animal, but both of those links will be in the show notes below, so go down there, click through.

Speaker 2:

You know what's interesting, jeff, I got a call from a very large investor the other day that's been tracking you know his friend and tracking he's like if people only paid attention, like actually paid attention to what you post and what you say, they would realize that you're giving them the playbook, like like there will be no surprise in a few years when some things happen. You've literally kind of said here's what's going to happen.

Speaker 2:

And it's not just like you're predicting it, you're doing it, you're funding the companies, you're doing the things like you're telling everybody exactly what you're going to do and they just kind of don't pay attention.

Speaker 1:

That's the thing with leadership.

Speaker 2:

Because this investor like called me up. He's like hey, do you want to go start a new company? Do an X, y and Z. I saw your post how much money do you want? Go build a team? Put some of your money like whatever Right. And it's like how did you know that? That's what I was saying Like, oh dude, like you're so transparent. If only people would get it out in their own way. My son actually told me, dad, you should stop. You should take a break from LinkedIn. You're sharing too much.

Speaker 1:

That's an interesting insight. Is that Devin?

Speaker 2:

Yeah, devin's like Dad, you're sharing your secrets in Open. Like it can't be secrets when you share them in Open, people have to be paying attention.

Speaker 1:

I'll ask Devin about that. That's funny. That's funny. So you should be following both KP, kp Ready on LinkedIn and KPeadyCo on LinkedIn, the company page, and again, you can find the links to those in the show notes below. What we've been doing is we've been unpacking, as is the whole format for the show KP Unpacked. We've been unpacking KP's LinkedIn post from March 11, 2025. And it goes something like this 11th 2025. And it goes something like this In the world of AEC AI disruption, it's the people that are in denial that won't see it coming. Things move slow until they move fast. Being dismissive about AI isn't ready, or hallucinations, or who will stamp the drawings, or my innovation team is doing AI All are leading indicators that you are focused on the wrong things. This one got a lot of engagement, as many do, but this one is one of the ones that spikes and we look for those right. We talk about the ones that people care about, the ones that we think have the most impact, and this is certainly one of those so.

Speaker 1:

KP. Thank you for joining me today to unpack this post. Now that you and I have recorded and I was just recording with Frank I feel like I have. Well, I know I have spent the last two hours talking about AI in different ways and on different levels. So it's been. It's been a good couple of hours, so thank you for this.

Speaker 2:

All right, good to see you.

Speaker 1:

And everybody else that's out there listening. Thank you for joining us. We'll be back again next week with another edition of KP Unpacked. What will it be this week? If you go to LinkedIn here, we'll make you a deal. If you go to LinkedIn and follow KP Ready, make you a deal. If you go to LinkedIn and follow KP Ready and you see one of his posts that you think that we should unpack here on KP Unpacked, drop that in the comments, give it a thumbs up or you know whatever reaction you want and put in the comments. Please do an unpacked and we'll watch for those comments and maybe, maybe we will choose the one that you asked for.

Speaker 2:

Uh and maybe we'll have them on.

Speaker 1:

Maybe we will.

Speaker 2:

That's one of the things. We'll make you a star. We'll bring you here All three of our all three of our listeners will be exposed to all three of our listeners. My mom loves this show. She just loves it.

Speaker 1:

So if we bring on the person that votes and we bring on your mom, there's no listeners left.

Speaker 2:

It's like my mom calls like hey, I haven't heard from you in a while. I'm like you listen to my pod mom, like why do we actually have to talk?

Speaker 1:

All right next week.

Speaker 2:

Next week we are kp's mom on kp unpacked no, that's, that's fine, as long as I'm not there okay. Well, you're in trouble now by the way, my mom thinks I'm still a civil engineer oh, all right.

Speaker 1:

Well, maybe we should have the producer cut this part out. We don't want to get you in trouble. You've been lying to your mother.

Speaker 2:

All right.

Speaker 1:

All right, thanks, kp. Thanks everybody for listening. We will be back next week with another episode of KP Unpacked. Thanks everybody.