Oro Labs, a Silicon Valley startup that uses artificial intelligence to automate corporate procurement processes, has raised $100 million in new venture capital funding.
The company’s Series C round of funding was led by Goldman Sachs Growth Equity and Brighton Park Capital. Existing investors Norwest Venture Partners, B Capital, XYZ Capital and Felicis also participate. As part of the transaction, Claire Greenan, vice president at Goldman Sachs Growth Equity, and Mike Gregoire, partner at Brighton Park Capital, will join Oro’s board of directors.
Oro declined to disclose its valuation after the new funding. This new funding brings the startup’s total raised to date to $160 million.
The five-year-old startup has built what it calls a “procurement orchestration platform.” It is a layer of AI-powered software that sits on top of a company’s existing enterprise resource planning and procurement systems. Rather than replacing these legacy investments, Oro serves as an intelligent front door that uses AI agents to route requests, check compliance, and automate manual processes.
Oro’s customers include many Fortune 500 companies, including Coca-Cola, Pfizer, Novartis, Thermo Fisher Scientific, and Booking.com. The company said it currently works with 15 of the top 25 life science companies, two of the top four diversified banks in the U.S., and five of the top 15 food and beverage manufacturers.
Oro’s funding comes a year after the five-year-old company announced it achieved 300% revenue growth. The company expects its revenue to triple again this year and says its “revenue retention rate” is currently 150%, meaning existing customers are rapidly increasing their use of the platform.
“The demand for procurement orchestration is surging because of one fundamental truth: procurement teams cannot continue to operate as before. Market volatility, disruption, and pricing pressures are too severe,” said Sudhir Bhojwani, co-founder and CEO of Oro Labs. He said businesses “need a layer of order and intelligence out of chaos, and that layer is orchestration.”
“It’s been a long time coming,” said Bhojwani, a software engineer who spent nine years at Ariba, a procurement software company acquired by SAP. luck The fundamental problem with existing procurement software is that it is “designed as a system of record, not a system of action.” His point is that while the software generates data in the form of purchase orders, contracts and invoices, it is not designed to generate risk-based assessments, such as whether a particular invoice should be paid or whether it presents a compliance issue.
He said procurement consistently receives the lowest net promoter scores in internal surveys because it is seen as an overly bureaucratic impediment that slows down business. And much of that bureaucracy still includes manual processes, Bhojwani said. He said that one Fortune 500 energy company (which he declined to name, but with annual revenue of about $40 billion) had a procurement process with 20 million human touchpoints annually before it started using Oro’s software.
“We built Oro to help businesses move faster without losing control,” said Lalitha Rajagopalan, co-founder of Oro Labs and current head of strategy and operations for the company. luck.
Bhojwani said Oro’s software has helped a global pharmaceutical company with approximately $20 billion in procurement spending reduce the time it takes to onboard new suppliers from more than 30 days to less than 10 days, and the company believes this can be further reduced to less than five days. Manual compliance checks on purchase orders that previously took 36 hours are now completed in six minutes, and 50% of transactions are now executed completely without human intervention, he said. He said that when the company compared the accuracy of Oro’s automated decisions to decisions made by employees in the purchasing department, the AI system reached 90% accuracy. This necessarily means “we can dramatically reduce the number of people doing this job,” he said.
Grégoire, a Brighton Park partner who will join Oro’s board, said the company represents a generational shift in how procurement technology works. “Previous generations of procurement software relied on rigid manual decision trees that easily broke with the size and complexity of the company,” he said. But Oro is built on an AI system that understands the wording of purchase orders, invoices, and contracts, and it’s also built on a knowledge graph, or complex map, of how a particular company’s processes work and what its purchasing and compliance rules are.
Mr Grégoire added that Brighton Park liked the fact that Oro’s founding team had deep roots in the procurement industry and had a good understanding of where traditional systems fell short. “Our exceptional staying power with some of the world’s most complex and highly regulated companies, including Novartis, Coca-Cola and Roche, proves that this platform can handle the most demanding compliance environments,” he said.
Oro plans to use the new funding to accelerate growth and enhance its product capabilities, as well as increase its sales and go-to-market teams. Bhojwani said the company spends about half of its budget on research and development. The company is also expanding what it calls the Oro Partner Enterprise Network (OPEN), which connects technology providers, consulting firms and service partners. Unlike many traditional Software-as-a-Service companies, Oro does not use a per-seat licensing model. Instead, you will be charged a fee based on transaction volume. Bhojwani said the pricing structure better reflects the value the platform provides. “I never believed [the per-seat] “It didn’t make sense before, and it definitely doesn’t make sense now,” he said of seat-based pricing.
He also said he is not concerned about companies using AI coding tools to create their own procurement software with functionality similar to what Oro has built. Integrating all of Oro’s capabilities is not easy, he says, and even if companies were to do it on their own, the cost of maintaining such a system would not be something most companies would want to incur.
