The products and services your company buys leave behind bread crumbs of data, ranging from transaction details and inventory records to contract terms and price trends. And many sourcing or purchasing managers use analytical tools to spot pricing irregularities or consolidate expenses.
But Suplari, a new startup based in Seattle, Washington, is trying to use machine learning to improve the procurement process. The company’s cloud service scavenges information from a customer’s enterprise software systems to ferret out cost savings, point out supply chain risks, and ensure compliance with government regulations.
“Businesses are facing significant uncertainty and volatility, unprecedented business model disruption, international competition, and increased government regulation,” said Nikesh Parekh, the co-founder and chief executive of Suplari, which closed $10.3 million in funding on Thursday.
“Simultaneously, enterprises are sitting on mountains of data that can help them run more profitably and efficiently than ever before,” Parekh said. That explains why the company, which raised $3.1 million of seed funding last year, is focused on giving procurement professionals a range of advanced analytical tools to sift through these massive reservoirs of data.
Parekh and the company’s other founders, chief technology officer Jeff Gerber and chief procurement officer Brian White, have a long list of potential customers. Only one-third of procurement executive use advanced software tools like predictive analytics to review market prices and contracts, according to a recent survey by consulting firm Deloitte.
The company is funded in part by the Menlo Park, California-based Shasta Ventures and other investors including Madrona Venture Group. Suplari said that its machine learning platform helps to curb costs and manage risks, which 78 percent and 54 percent of the survey respondents, respectively, said were top business concerns.
The company’s software seems to make sense for big companies that could have a harder time weeding out inefficiencies. Suplari said that it has signed on several Fortune 1000 companies and it has helped one customer cut its software licensing fees by 33 percent. The company’s cloud service is not limited to procurement, as it can also be used to analyze travel and other expenses charged to corporate credit cards.