Today, we are excited to announce our lead investment in Runwise as part of the company’s $40 million Series B. Runwise is pioneering the modernization of building operations through its integrated hardware and software platform, and joins Menlo Ventures’ portfolio of innovative companies at the intersection of AI and built world.
It may come as a surprise that building operations technology largely looks the same as it did 60 years ago. Despite significant advancements in smart home technology for consumers, commercial and multi-family residential buildings continue to rely on outdated systems from legacy providers. This technological gap is particularly striking when you consider that approximately 43% of all energy use in the United States—roughly $730 billion annually—is dedicated to heating and cooling buildings.
Building owners face considerable challenges with these legacy systems. They lack visibility into their buildings’ operations, experience significant energy waste, and struggle with costly, inefficient maintenance processes. Traditional building management systems are prohibitively expensive and complex, putting them out of reach for all but the highest-end commercial properties.
This is where Runwise enters the picture. Their platform replaces outdated thermostats with an intelligent control system that combines hardware sensors throughout the building with cloud-based software. The system continuously monitors temperatures, optimizes heating and cooling operations, and provides unprecedented visibility to building managers through an intuitive web application.
What sets Runwise apart is their focus on creating a solution that is reliable, cost-effective, and easy to install. After years of optimization, they’ve developed a system that delivers 20-30% energy savings while requiring minimal building infrastructure changes. Their mesh-connectivity approach allows the system to function effectively without costly WiFi upgrades that would be prohibitive for most building owners.
The company’s value proposition resonates strongly with property owners and managers who are focused on their bottom lines. By explicitly demonstrating ROI during the sales process and continuously tracking savings in their application, Runwise delivers for their customers, which shows in their industry-leading customer retention rates.
The results speak for themselves. Customers describe how Runwise has saved them millions in energy costs while also providing operational benefits: Property managers can remotely diagnose issues without unnecessary site visits, maintenance becomes proactive rather than reactive, and tenant comfort improves.
Runwise was founded in 2018 when Lee Hoffman joined forces with Jeff Carleton and Mike Cooke to commercialize the technology. With Jeff’s background in property management overseeing a 150-building portfolio in New York City, he had firsthand experience with the inefficiencies in building operations and knew there had to be a better approach.
What began as a heat-control system primarily for NYC buildings is now expanding nationally and growing to include cooling optimization, leak detection, gas detection, and more. The company’s vision extends beyond these initial applications to create a connected cloud for buildings—similar to how Samsara has created an industrial IoT platform that other developers can build upon.
We believe that, over the next decade, value will predominantly be created by two types of companies: those that drive AI innovation and those that enable AI to transform the physical world. Runwise is perfectly positioned at the intersection of these forces, bridging the critical gap between AI and the built environment. We believe the building operations market represents a $20B+ opportunity that’s ripe for disruption through AI and IoT technologies.
At Menlo, we’ve partnered with several companies that have pioneered new categories through integrated hardware and software platforms, including Dedrone, Arc, Dropcam, JUMP, and Roku. We’ve also built a best-in-class AI portfolio, backing companies like Anthropic, Observe, Eleos, and more.
We are excited to welcome Runwise to the Menlo portfolio!
Steve is a partner at Menlo focused on investments in Menlo’s Inflection Fund, which targets fast-growing Series B/C companies. He specializes in AI-powered vertical SaaS investments and supply chain technology, including Enable, Eleos, Observe.AI, Scout, 6 River Systems, ShipBob, CloudTrucks, and Parade. Steve joined the firm in 2015 as an…
