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Amazon makes first investment in a homebuilder, backing start-up focused on prefabricated houses

Eugene Kim
Amazon makes first investment in a homebuilder, backing start-up focused on prefabricated houses

Amazon has made clear that it wants to own the smart home space . Now the company's going a step further, taking a stake in a start-up that's building actual homes.

On Tuesday, Amazon said its Alexa Fund invested in Plant Prefab, a Southern California company that says it uses sustainable construction processes and materials to build prefabricated custom single and multi-family houses. The start-up is aiming to use automation to build homes faster and bring down the costs.

It's a new market for Amazon and the Alexa Fund, which typically backs start-ups focused on voice technology. The investment comes less than a week after Amazon launched over a dozen Alexa-powered smart home devices, including a microwave oven and an amplifier that can be controlled by the Alexa voice assistant. Earlier this year, Amazon acquired the smart doorbell maker Ring, and the company is also reportedly working on a secretive home robot.

The smart home market is expected to grow into a $53 billion industry by 2022, according to Zion Market Research.

"Voice has emerged as a delightful technology in the home, and there are now more than 20,000 Alexa-compatible smart home devices from 3,500 different brands," Paul Bernard, Alexa Fund's director, said in a statement on Tuesday. "We're thrilled to support [Plant Prefab] as they make sustainable, connected homes more accessible to customers and developers."

Amazon joined Obvious Ventures, the firm co-founded by Twitter's Ev Williams, in Plant Prefab's $6.7 million financing round.

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