Levelpath, a procurement software program startup based by the duo behind Scout RFP, has raised $55 million in Collection B funding led by Battery Ventures as the corporate seems to be to quadruple its income this yr.
The funding spherical additionally noticed participation from present traders, together with Benchmark, which led Levelpath’s $14.5 million seed spherical, and Redpoint, the lead investor within the $30 million Collection A spherical introduced in 2023.
The startup was based by Stan Garber and Alex Yakubovich (pictured proper), whose earlier startup, Scout RFP, was acquired by Workday for $540 million in 2019. Through the three years Yakubovich and Garber spent working at Workday, the 2 recognized persistent procurement challenges that motivated them to construct a mobile-first, user-friendly platform.
Levelpath’s timing proved fortuitous; launching proper as ChatGPT debuted has enabled the startup to combine AI capabilities from its inception. This consists of reviewing unstructured knowledge in contracts and recommending cheaper, related services and products. The corporate now counts Ace {Hardware}, Amgen, Coupang, and SiriusXM as clients.
The funding indicators confidence in Levelpath’s quick progress and its potential to disrupt a market dominated by legacy gamers. Procurement software program has lengthy been managed by outdated distributors like Coupa and Ariba, whose clunky methods usually drive workers to bypass official processes. This “rogue” spending utilizing company bank cards continuously leads to overspending and missed alternatives for bulk reductions, in response to Battery Ventures basic accomplice Neeraj Agrawal.
In actual fact, procurement represents corporations’ second-largest expenditure after payroll, making software program enhancements significantly helpful. The procurement software program market was valued at $7.3 billion yearly in 2023, in response to Fortune Enterprise Insights.
Though Levelpath is a more moderen and certain smaller participant in comparison with its foremost rivals — together with Zip, valued at $2.2 billion final fall, and Oro Labs, backed by Felicis — the corporate appears to have all the proper components, together with Agrawal, who led Battery’s Collection B funding into Coupa and has joined Levelpath’s board.
Coupa, in fact, grew into one of the crucial profitable procurement corporations of its period. It had a profitable IPO in 2016 and several other years later was taken personal by PE agency Thoma Bravo for $8 billion.
Agrawal, who seemingly understands what it takes to construct a giant enterprise on this class, is equally impressed by Levelpath’s know-how and its founders. “They’ve such a powerful status for delivering product, being good folks to work with, and doing what they are saying they’re going to do,” Agrawal advised Trendster. “Clients need to work with them and assist them construct this next-generation product.”
Yakubovich and Garber have been buddies since attending highschool in Ohio. They bonded over their shared heritage as immigrants from the previous Soviet Union and a mutual curiosity in entrepreneurship. The pair have been working collectively for over 20 years, and their said purpose is to assist clients take pleasure in, fairly than keep away from, utilizing procurement software program.
Whereas procurement would possibly look like an earthly enterprise perform, it provides a direct and important return on funding by serving to corporations lower your expenses.
“It makes the money register ring due to these financial savings,” Agrawal mentioned.
