<\/p>\n
Companies tend to divide their procurement spending into two main buckets. The first is large purchases over $500,000 with some starting $1 million, depending on the size of the organization. Anything below that figure falls under a category known as \u201ctail spend.\u201d Boston-based startup Fairmarkit has been working on a tail spend procurement solution for several years now, and has built a modern platform with a large dose of artificial intelligence to help companies find the best deals when it comes to their tail spend.<\/p>\n
Today, the company announced a $35.6 million Series C, the kind of investment that\u2019s been harder to come by this year in a tightening VC environment.<\/p>\n
Fairmarkit co-founder and CEO Kevin Frechette says that legacy players like Oracle and SAP have tended to dominate the industry up until now, concentrating on the largest purchases with what he calls \u201cclunky and manual\u201d systems. He and his co-founders saw an opportunity to innovate around the tail spend space when they launched the company in 2017.<\/p>\n
\u201cWe have really doubled down on completely owning and becoming the leader in the tail spend management space,\u201d Frechette told . Yet the company recognized that large companies weren\u2019t simply going to rip and replace those legacy solutions, so they came up with a way to work with them.<\/p>\n
\u201cWe integrate with their existing procurement solutions. We then use AI to determine what they\u2019re looking to buy and match that to suppliers in our marketplace, do competitive sourcing, and then push results back into their procurement solution to finish the purchase,\u201d he explained.<\/p>\n
The AI comes into play in the automated vendor selection process. Companies configure Fairmarkit for things like price, sustainability and vendor diversity and the system finds the best match for them, a process known as autonomous sourcing.<\/p>\n
\u201cWe\u2019ve really [committed to] something called autonomous sourcing. It\u2019s the idea that you can fully automate the sourcing process and do it intelligently with data. So it\u2019s not just pulling in a request for a purchase, but automatically recommending [vendors], automatically sourcing and automatically awarding [the contract],\u201d he said.<\/p>\n
The company has 100 customers including large players like British Petroleum, BT Group (formerly British Telecom), Snowflake and ServiceNow (which is a strategic investor in today\u2019s round).<\/p>\n
He said from a momentum perspective, the amount of spending moving through the platform grew 4x in the last 12 months. The startup makes money via SaaS licensing fees, which scale as customers process more spend through the platform. While he didn\u2019t get specific about other numbers like revenue, the platform growth combined with investor confidence suggests the company is moving in the right direction.<\/p>\n
The company had 70 employees when we spoke to Frechette about his Series B at the end of 2020. Today the startup has 135 workers with plans to double again in the next year. Frechette has committed to building a diverse workforce, while building a product that enables his customers to buy from a diverse set of suppliers. Since we last spoke, the company has brought in a head of belonging, inclusion and culture.<\/p>\n
\u201cSo the head of belonging, inclusion and culture is responsible for reporting how we\u2019re doing, while also creating the programs and the engagement, both actively with the team, but then also through third party platforms. [The goal is] to make sure that we\u2019re not just thinking about it when we\u2019re [hiring], but that we\u2019re also being inclusive once people are at the company as we keep scaling,\u201d he said. He admits that it\u2019s challenging, but they are working hard at building an inclusive culture.<\/p>\n
Today\u2019s $35.6 million investment was led by Omers with participation from existing investors GGV Capital, Insight Partners and HighlandX. The company also got a strategic investment from customer Service Now.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"
Companies tend to divide their procurement spending into two main buckets. The first is large purchases over $500,000 with some starting $1 million, depending on the size of the organization. Anything below that figure falls under a category known as \u201ctail spend.\u201d Boston-based startup Fairmarkit has been working on a tail spend procurement solution for […]<\/p>\n","protected":false},"author":1,"featured_media":1196504,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[],"class_list":["post-1196503","post","type-post","status-publish","format-standard","has-post-thumbnail","category-celebrity-gossip"],"_links":{"self":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts\/1196503","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/comments?post=1196503"}],"version-history":[{"count":0,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/posts\/1196503\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/media?parent=1196503"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/categories?post=1196503"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ghanamma.com\/2022\/wp-json\/wp\/v2\/tags?post=1196503"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}