Details have emerged about supply chain software startup STORD’s latest funding round, a $12.3 million Series A. The round was led by Silicon Valley venture firm Kleiner Perkins and included existing investors Susa Ventures and Dynamo, along with Ionic Security founder Adam Ghetti, Service Provider Capital, and Tom Noonan of TechOperators.
One of the largest VC funds in the country, Kleiner Perkin’s portfolio alumni include names such as Amazon, Google, Twitter and Square. The firm also backs Ionic and was one of the first investors in Internet Security Systems, Noonan’s former company that sold to IBM in 2007.
“It’s important to our customers that we balance tech high-growth with stable logistics experience,” Sean Henry, STORD’s co-founder and CEO, tells Hypepotamus. “With their history, Kleiner is one of those names that really aligns with our enterprise clients.”
With this fundraise, Kleiner Perkins partner Ilya Fushman has joined STORD’s board of directors. Along with helping to build Dropbox, Fushman has experience investing in logistics companies, including an early investment in software startup KeepTruckin.
“[Fushman] also has a lot of experience up-selling customers, which is really our strategy,” says Henry. “We get in with an enterprise on a small buy and then they see our value through the whole organization.” Henry says they grew existing customer business by over 2,000 percent in 2018.
Henry and co-founder Jacob Boudreau founded the company in 2016 when the two were still in their teens. After going through the logistics-focused Dynamo accelerator in Chattanooga, the founders learned how shippers, who increasingly must compete with the last-mile supply chain dominance of Amazon, struggle with inefficient and siloed warehouse operations.
The majority of shippers store their assets in rented warehouse space managed by third-party agencies. The problem is, these agencies all have different systems to manage operations, leaving companies with disparate tracking and data about where all of their assets are at any time — and losing them a lot of money and time in the process.
STORD comes in as a universal backend, streamlining and aggregating the operations of independent warehouse operators. Businesses who partner with STORD can then access this network of warehouses across the country.
But no, it is not the “Airbnb for warehouses.” STORD calls their process “networked distribution,” differentiating the service from companies that provide on-demand, temporary storage.
For enterprise clients — of which they now count more than five Fortune 500s and two Fortune 100s — STORD’s software fully optimizes their entire storage and supply chain operations. They can look at where the company is storing products and move them closer to their final destination, ensure warehouse space doesn’t sit empty, provide a clearer picture of asset tracking and movement, and ensure warehouse operators don’t lose money on idle time.
“Enterprises are really looking for us to bring insight, visibility, and control to their warehousing. They don’t want to be using pen and paper tracking,” Henry told Hypepotamus in an interview last year. He explains that, although much of their recent product development was not in the initial roadmap, they have expanded where the customer needed them.
The company has even forayed into freight, integrating their system with truck tracking software to ensure assets get from point A to B as quickly and efficiently as possible.
“Taking a customer-centric approach, if we don’t deviate from our core mission… we should address all the pain points they’re facing,” says Henry. “Freight touches every part of the supply chain.”
That customer-centric approach also means STORD offers another solution to the minority of enterprises that operate their own warehouses: plugging the software into the company’s existing warehouse network so they can optimize the supply chain themselves.
STORD reports impressive results: they have grown revenue by 10x in the last year, expanding from five employees at the start of 2018 to 30 now. They moved into an office in Midtown and plan to hire another 50 this year, primarily in technology and product.
Henry says they had a “significant amount of runway” from their last funding round, a $2.4 million seed a year ago. But with several large clients in their pipeline and demand continuing to grow, he wanted to move faster.
They will now focus on improving their software platform, connecting with more enterprises, and of course, hiring.