Amazon Is Literally Helping to Build Smart Homes Now

MarketsMotley Fool

For the past three years, Amazon (NASDAQ: AMZN) has dedicated hundreds of millions of dollars to dozens of promising businesses through its Alexa Fund to further the reach of its intelligent voice assistant.

But while the Alexa Fund's early investments have been overwhelmingly allocated to voice-technology start-ups in the space, its latest move takes that dedication to an entirely different level.

Continue Reading Below

If you build it...

On Tuesday, home design and prefabrication company Plant Prefab revealed the Amazon Alexa Fund was one of two investors included in a $6.7 million Series A funding round.

You read that right: Amazon just made its first investment in a homebuilder.

Plant Prefab, for its part, bills itself as the "first home factory in the nation focused on sustainable construction, materials, processes and operations." It also claims that, compared with traditional builders, its approach reduces construction time by 50% and costs by 10% to 25% in major cities. What's more, in contrast to the lower-quality modular homes offered by many of its prefabrication peers, Plant Prefab focuses on high-quality custom homes often based on the plans of its clients' architects -- a model that bears striking similarities to Amazon's industry-disrupting ways.

But more pertinent to this investment: You don't need to stretch far to tie Plant Prefab to the goals of Amazon's Alexa.

Alexa Fund director Paul Bernard explained:

The future of smart homes

It seems, then, that a central premise of Amazon's involvement is that Plant Prefab will increasingly incorporate connected smart-home functionality into its designs. And in doing so, it will foster the widespread acceptance of lifestyles revolving around Alexa's voice technology and ecosystem.

Now, this doesn't guarantee that Amazon has broader ambitions to eventually become a wide-scale homebuilder itself. But it seems to be no coincidence that this news came shortly after Amazon quietly unveiled a dozen new Alexa-related products last week. Those products include a line of new Echo smart speakers, Fire TV devices, and even a voice-controlled microwave with a built-in Dash button to order popcorn when you're running low.

If the latter device seemed like a less-than-subtle hint that Amazon wants to take over more than just your living room, we can safely consider the Plant Prefab investment a blaring declaration to the same effect. And as voice technology continues to become more pervasive, I suspect Amazon is only just getting started.

10 stocks we like better than AmazonWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Amazon wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of August 6, 2018

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Steve Symington has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.