Supply chain disruptions caused — or exacerbated — by the pandemic continue to affect businesses in a range of industries. For example, thirty-six percent of small businesses responding to a U.S. Census Small Business Pulse last year reported delays with domestic suppliers. Each missed shipment or material shortage can be costly. In a 2021 Deloitte survey, more than 40% of chief financial officers indicated that supply chain shortages or delays increased their companies’ expenditures by 5% or more.
Supply chain technology companies have risen to prominence during the shortages, promising a solution to a problem that looks unlikely to abate anytime soon. One of these vendors is Keelvar, a Cork, Ireland-based supply chain analytics platform that weighs different sourcing scenarios to guide customers to decisions for their supply chains.
Keelvar is headed by Alan Holland, who left his position as a lecturer in AI at the University of College Cork to found the startup in 2012.
“My goal was to use my specialist knowledge in optimization, game theory, and mechanism design to commercialize advances in AI for procurement teams,” Holland told TechCrunch in an email interview. “[O]ur solutions have helped our customers adapt to ever more volatile conditions, notably in the transportation market, where our [platform has] allowed customers to source efficiently in an adverse environment.”
Organizations that rely on the supply chain, which is practically all of them, engage in a process called procurement. Procurement entails acquiring goods and services from suppliers who typically compete for business by submitting bids that companies evaluate. Suppliers with the most attractive bid are awarded a contract, the terms of which are subject to negotiation.
Keelvar allows customers to canvass an array of direct and indirect procurement bid information from suppliers and then analyze multiple awarding scenarios based on those criteria and other constraints. (Direct procurement is spending on goods and services that drive tangible profit, whereas indirect procurement is spending on goods and services needed for day-to-day operations.) Using the platform, they can also launch and run new bidding events. Algorithms sort through data on supply chain disruptions and vendors, cleansing it and extracting information before offering recommendations.
During the pandemic, Holland says that pharmaceutical companies used Keelvar to spot bad actors and inflated prices in the supply chain, and respond by rerouting goods through other means of transportation (e.g., via ground instead of air).
“AI-powered sourcing bots are essentially agents designed to execute several tasks and reason about inputs they receive, such as identifying suppliers to invite to a bidding event, managing supplier communications and bid analysis, and recommending award decisions,” Keelvar explains on its website. “[The] bots can establish spot bidding or mini-tender events within a matter of minutes, managing and automating mundane tasks such as inviting carriers, collecting and validating bid data, messaging bid status updates, conducting necessary rate card and lane information lookups, and generating award recommendations.”
Venture capitalists see the opportunity in supply chain. Last year was a banner year, when VCs put $11.3 billion in financing toward vendors in the sector, according to Crunchbase. Keelvar is a beneficiary, having today closed a $24 million Series B funding round led by 83North with participation from Elephant, Mosaic, and Paua.
“Enterprises were blindsided when the pandemic shut down the global supply chain. As issues persist and show no sign of relenting, C-suites are finally recognizing that intelligent automation is a must-have,” 83North partner Philip Chopin said in a statement. “Keelvar’s unique automation and optimization solutions empower procurement teams by helping them easily define their needs and react faster to market changes. The company’s blue-chip customer list and incredible retention and satisfaction rates are a powerful testament to their technology, team, and vision.”
Keelvar competes with a number of companies in the procurement solutions space, including Fairmarkit, Tealbook, and Contingent. But while remaining vague about Keelvar’s technological advantages, as well as revenue, Holland points to the company’s overall growth in recent months. Keelvar, which plans to expand its 85-person headcount to over 130 by the end of the year, currently has over 70 enterprise customers and “thousands” of paying users.
“[Recently,] we’ve significantly expanded our customer base and team, as well as successfully launched [air] and ocean bots for sourcing automations,” Holland said. “We’ve [also] successfully grown as a remote-first organization, doubling our workforce.”
The Series B brings Keelvar’s total raised to $43 million. Holland says that the company plans to put it toward product development and expanding in the U.S.