The business of platforms for the purchase of goods and services, in other words, procurement, is alive and well. Case in point, Zippera startup that develops acquisition software, yesterday announced its $100 million Series C financing led by Y Combinator with participation from CRV and Tiger Global.
Zip CEO Rujul Zaparde says the funding, which values Zip at $1.5 billion, will go toward “new generative AI applications” and “fostering adoption” among the startup’s customer base.
“In the near term, we are looking to add new AI-based capabilities to the Zip platform that streamline the end-to-end gate-to-checkout process,” Zaparde told TechCrunch in an email interview. “We believe there is tremendous potential for AI in procurement to improve efficiencies and synthesize information that can make life easier for our clients.”
Zaparde and Lu Cheng, the company’s second co-founder, started Zip at the height of the pandemic in July 2020. Previously Airbnb engineers, Zaparde and Cheng say they experienced firsthand how difficult it can be for employees to apply for the purchase of a new business. , which often includes several complex steps, such as getting approvals and tracking progress from the request to the actual purchase.
With Zip, Zaparde and Cheng created what they describe as a “procurement gate” solution that allows employees to initiate a purchase that is then routed for approval through finance, legal, IT, security and other teams, and enterprise resource management software. A recently introduced feature, admission-to-pay, provides expanded capabilities such as purchase order issuance, invoice processing, and payments.
A flowchart illustrating Zip’s procurement solution, which touches various departments within a customer’s organization.
In the short term, Zaparde says Zip is looking to add new AI-based capabilities to the platform that will further streamline the admission to payment process. “We believe there is great potential for AI in procurement to improve efficiency and synthesize insights that can make life easier for our clients,” he added.
AI could become a growth area for Zip. But despite competition from providers like Keelvar and Focal pointthe startup appears to be doing just fine with no new lines of revenue imminent.
Zip has more than doubled its client list since May 2022 (when it closed its Series B), adding companies like Snowflake, Coinbase, Canva, and Databricks. Nearly $1 billion a month is now approved on the platform, Zaparde says, and $937 million in total savings have been tracked through Zip to date.
Zaparde says that Zip didn’t even need to increase his Series C when he did it, instead it was an opportunistic round.
“While Zip does not disclose specific revenue metrics, I can confirm that we have seen significant ARR growth since our Series B in 2022,” he continued.
With Series C closing, Zip’s war chest stands at $181 million. A large portion goes toward expanding the company’s presence with a new office in Dallas, Zaparde says, adding to its San Francisco headquarters and a satellite office in Toronto.
—————————————————-
Source link