Atlanta’s strength in supply chain and software-as-a-service has attracted yet another high-potential startup from the coasts.
Bid Ops, an automated negotiation platform for procurement, has secured an office in the Atlanta Tech Village to grow their technical and product team. Until now, the team had primarily been located in San Francisco.
Bid Ops was born out of the experience that CEO Edmund Zagorin had doing sustainability-focused procurement analysis — figuring out what social and ecological impact a company’s procurement decisions produced. He explains that procurement encompasses any company spend that isn’t people-based: raw materials, manufacturing hardware, etc.
“You can learn a lot about a business by seeing what they choose to buy and how they choose their procurement partners,” says Zagorin. And when you’re looking at large companies, a seemingly-small procurement decision can translate to millions — perhaps even billions — of dollars.
In 2017 he co-founded Bid Ops, a cloud-based, AI-powered service that helps match companies and vendors for an ideal bid. The software looks at all facets of the transaction — pricing, environmental and social impact, risk mitigation and more.
It uses behavioral psychology to help make the negotiation as successful as possible, guiding the company and vendor through the process.
“Our AI will forecast the most likely identifiable outcome given how a vendor has responded to pre-qualification questions that indicate their eagerness or sensitivity to the requirements of a particular contracts. It helps guide and coach a vendor to create a better quote,” Zagorin explains.
“Ultimately, both sides get a better deal out of the process.”
Some of the factors that go into what Zagorin calls the “total cost of ownership” include the upfront unit price of materials or hardware, shipping distance and convenience, and vendor reliability.
The company claims that using the tool generates a 24 percent and higher savings for enterprises.
Then there are the less quantitative factors that go into a vendor decision: environmental, ecological, and social impact.
“You can look at vendors that are offsetting greenhouse gas, or measuring and reporting out their usage of PFCs, or getting their raw materials with organizations that measure human rights standards,” Zagorin says.
The startup primarily serves large enterprises that spend hundreds of millions on raw materials or industrial size. That’s when these vendor decisions are really critical to the business’s success.
The Bid Ops platform is designed to allow for global negotiation, translating across languages and currencies. Companies pay a monthly subscription fee based on the number of employees accessing the platform and amount of annual spend.
The Atlanta expansion comes after the startup raised a $1.75 million seed round led by Illuminate Ventures and Cervin Ventures in March.
CTO Andrew Jones, who gained a background in machine learning at Georgia Tech, will lead the Atlanta office. Zagorin says they were attracted to the strength of the local talent and burgeoning engaged tech scene.
“We found that everyone we talked to [here] was very excited about Atlanta, and that gave us a good sense that there was a lot happening in the engineering community in ATL,” says Zagorin.