As most shopping has moved online during the global pandemic, startups developing software and other products to help with the transition have begun to attract the attention of venture capital firms.
We’ve seen companies win rounds more and more in the eCommerce infrastructure and support ecosystem, and CommerceIQ is the latest to provide late-stage funding. The CEO is Guru Hariharan, who you may remember from his job at retail analytics firm Boomerang Commerce, which was a Startup Battlefield finalist in 2014. He left the company for Lowes in 2019.
Hariharan has a background in machine learning and e-commerce, and while at Amazon, he said his goal was to take people out of the retail equation, so his team developed software called Amazon Selling Coach to learn how to work with brands. .
When people started moving their purchases, from appliances to toothpaste, to Amazon and other markets, Hariharan wanted to start a company that would keep track of where all the money went.
Hariharan said: “If you look at the retail situation in general – buying branded goods, there should be a balance between buyers and sellers.” “I left the business to focus on building the selling side of the equation and building relationships with retailers to sell the brand.”
CommerceIQ’s retail ecommerce management tools automate and integrate aspects such as category analysis and management of retail media, sales and operations under one roof for brands. He said customers can expect an average revenue growth of 18%.
The San Francisco Bay Area company is currently partnering with more than 2,200 brands such as Johnson & Johnson, Kellogg’s, Kimberly Clark and Bayer to increase sales, increase category market share and sell through online retailers including Amazon, Walmart , Target and Instagram. Manage profitability. ,
CommerceIQ completed $115 million in Series D funding, bringing the company’s valuation to over $1 billion. The latest capital injection came less than a year after a $60 million Series C round in June 2021. This gives CommerceIQ $175 million in total funding over the past 12 months and $196 million to date.
The funding round is led by SoftBank Vision Fund 2 and includes participation from existing investors including Insight Partners, Trinity Ventures, Shasta Ventures and Madrona Venture Group.
As part of the investment, Priya Saiprasad, a partner at SoftBank Investment Advisors, will join the board of directors of CommerceIQ.
“E-commerce penetration has grown at an unprecedented pace and online channels are a strategic priority for big brands,” she said. “Traditional physical strategy is not moving into e-commerce, but the old way of dealing with spreadsheets and human operations is not scaling. CommerceIQ is the leading channel optimization platform that helps big brands win in retail.
In addition to the opportunity to partner with Saiprasad, Hariharan said that driving the demand for new funding, especially when startup funds are still firmly in the bank, has been a turning point in the $4.5 trillion retail sector. This includes the $1 trillion that went through e-commerce and propelled the industry forward by as much as five years in 12 months during the global pandemic.
In terms of the $1 trillion breakdown in e-commerce, Hariharan estimates that about $150 billion goes directly to consumers, with another $850 billion going indirectly to consumers like Walmart, Target, and Gopuff sites.
That’s why he thinks now is the time to speed up CommerceIQ. The company ended 2021 with 106% year-over-year revenue growth, a 113% increase in customer service, and a 100% increase in global employees.
The company has also increased its level of automation, which was $215 million last year, up from $70 million a year. Hariharan expects to deliver 500 million automated systems this year. Meanwhile, $1.1 billion passes through the software, up from $250 million last year.
The new funding will allow CommerceIQ to accelerate its R&D and M&A activities, which Hariharan said will be deeper and broader in the SaaS vertical, while also focusing on potential expansion opportunities in Europe and Asia Pacific.
“We are more opportunistic and we add fuel to the fire, but we tend to add fuel to a fire that is already burning well,” he said.
Indeed, the e-commerce infrastructure ecosystem is on fire, with companies announcing new funding almost daily.
Talia Goldberg, a partner at Bessemer Ventures, told me “it’s a great time to work for an e-commerce company that’s faced hurdles and acceptance.”
“Part of the reason this is an attractive place to invest is because people are focused on the productivity and growth strength of the business, but it’s just a huge market,” he said. “There are a lot of opportunities to get around, and there will be no winners among some companies, but there will be some big companies that will segment the market in different ways.”
London & Partners and Dealroom.co reported this month that $51 billion in venture capital was invested in US digital retailers in 2021, up from $23 billion in 2020. Globally, it was $140 billion last year, up from $68 billion a year ago. before that. He certainly didn’t slow down. Here are just a few of what we’ve seen this month:
- Akeno, which specializes in product experience and information management, has raised $135M in Series D funding. We’ve profiled them before.
- Argentine AI and computer vision startup Intuitivo has raised $7.8 million in seed funding to develop an all-in-one shopping experience that turns any refrigerator box or cabinet into a smart laptop.
- Canal, which has developed a connected commerce app that allows brands to directly manage relationships with the vendors whose products they sell, has raised a $22.5 million Series A and launched it on the Shopify App Store.
Meanwhile, Ryan Lee, co-founder and CEO of Nautical Commerce, a marketplace startup tool, said we will likely continue to see growth as commerce technology companies continue to transition to e-commerce support tools.
“Established companies are over 20 years old and built on old infrastructure from before smartphones and social media,” he said. “In the next decade, we will have connected commercial and other tools to share your catalog with buyers all over the world.”