Despite the investor cautionary tale that the startup world was permeating during the economic downturn, certain startup types have been a little more insensitive to market conditions. The global supply chain has been one of the biggest industrial victims of the pandemic, so it stands to reason that companies addressing global supply chain issues would remain attractive to otherwise hesitant venture capitalists.
In the past few months alone, we’ve seen Germany-based IntegrityNext raise $109 million to help companies monitor their supply chains for ESG (environmental, social and governance) compliance; Texas-based Overhaul secures $73 million for supply chain security platform; San Marcos-based Everstream has raised $50 million to bring predictive insights to supply chains; French company Sesamm raises $37 million to give companies ESG insights into their supply chain; and India’s Pando raise $30 million to grow their freight management platform.
Today it’s Prewave’s turn to demonstrate that the global supply chain continues to be one of the hottest tickets for VC dollar raising. The Austrian startup revealed it has raised €18 million ($20 million) in what it calls a Series A+ funding round, following up on its €11 million ($12.3 million) Series A round eight months ago.
For its latest cash injection, Prewave has also enlisted European VC heavyweight Creandum, who previously backed the likes of Spotify, Klarna and iZettle.
Founded in Vienna in 2017 by Harald Nitschinger and Lisa Smith, Prewave touts itself as a holistic supply chain risk platform that encompasses “every stage of the risk lifecycle” by identifying, analyzing, mitigating and reporting on these risks.
For example, companies such as BMW, Lufthansa and PwC use Prewave to monitor every entity in their supply chain through channels such as social media, news reports and other data sources to understand not only what is happening within companies in their supply chain but also external factors such as earthquakes, floods , political unrest, lawsuits or workers’ strikes – anything that can affect the global transfer of goods.
The company says it has developed its own “crawler” that finds publicly available information in dozens of languages.
“Having our own crawler instead of relying entirely on third-party supply chain data providers allows us to continually expand and improve our coverage,” Smith explained to EntertainmentCab by email. “We also connect to various social media platforms and for specific types of events we use external data sources, such as USGS (United States Geological Survey) for earthquake data or GDACS (Global Disaster Alert and Coordination System) for weather information. The combination of all these data points provides broad coverage of both local and global supply chain risk events.”
Prewave then analyzes all the data and provides a dynamic supplier risk score that changes according to all the new data it receives.
Demand (chain) and supply
There are a number of reasons why the demand for supply chain insights is skyrocketing beyond simply improving their bottom line by avoiding disruptions. These include legal obligations, for example Germany recently passed a new supply chain due diligence law that makes it the responsibility of large companies to detect human rights violations and environmental risks in their supply chain. A similar directive is also currently being proposed for the wider European Union (EU).
And then there’s the simple fact that consumers increasingly expect the companies they do business with to have at least some moral and ethical principles, not just beholden to shareholder sentiment.
“Supply chain technology has weathered the economic headwinds of recent years as it has become increasingly important for companies to optimize their operations, adapt to external risk and reduce costs within their supply chain,” Nitschinger said by email. email to EntertainmentCab. “For example, the pandemic has exposed critical vulnerabilities in global supply chains, making it clear that companies need to invest in technologies that improve visibility and sustainability, predict potential disruptions and enable more flexible and responsive strategies. As businesses continue to face economic challenges, the importance of supply chain risk management technology is only expected to grow.”
With another $20 million in the bank, Prewave plans to double its recent growth, growing its headcount from 20 employees early last year to more than 100 today, which Nitschinger says “reflects the substantial increase in sales.” seen in the same period.
Aside from main sponsor Creandum, Prewave’s latest investment included contributions from Ventech, Kompas, Seed+Speed, Segnalita, Speedinvest, Working Capital Fund and Xista Science Ventures.