Zip Raises $190 Million, Valuation Soars to $2.2 Billion: AI-Powered Procurement Platform Reshaping Business Spending

Procurement platform Zip raises $190 million at $2.2 billion valuation

This landmark investment -- one of the largest for an enterprise SaaS company this year -- brings Zip's valuation to $2.2 billion, a significant increase from its $1.5 billion valuation in 2023. Additional participants in the round included new investors DST Global, Adams Street, and Alkeon, along with existing investors Y Combinator and CRV. In today's global economy where businesses face mounting pressure to optimize spend and mitigate risk, procurement -- the process of acquiring goods and services necessary for business operations -- has become a critical function. Each year, companies spend trillions of dollars on everything from office supplies and software subscriptions to professional services and marketing agencies. Procurement represents the second largest area of business spend after payroll, yet despite its enormous financial impact, the purchasing process has remained stuck in the past - slow, complex, and riddled with inefficiencies. "Procurement is broken," said Rujul Zaparde, Co-founder and CEO of Zip. "Companies are wasting billions of dollars and countless hours navigating byzantine approval processes, dealing with security risks, and manually entering data. Zip has already proven that we can fix that, saving our customers billions of dollars and thousands of hours of time -- and our new round of funding will allow us to continue to revolutionize business spending." Zip's platform offers a stunningly intuitive, consumer-grade interface that makes purchasing as easy as online shopping, while ensuring compliance, efficiency, and cost optimization. Zip streamlines complex workflows across departments -- from legal and IT to security and finance -- seamlessly connecting all teams involved in the procurement lifecycle. This holistic approach has already transformed operations for industry giants like Snowflake, Discover, and Sephora, who have collectively saved over $4.4 billion in procurement spend through Zip's platform in less than four years. To date, over $107 billion in customer spend has been processed through Zip, and Zip has achieved 3x growth across large enterprises just this year. Just as Salesforce revolutionized customer relationships and Workday transformed employee management, Zip is redefining how businesses interact with suppliers and manage spending. This new funding will fuel Zip's mission to become the global standard for B2B spend and will be strategically deployed to: * Accelerate R&D efforts, doubling down on Zip's approach to building best-in-class procurement software entirely in-house. This includes further development of Zip's highly successful Procure-to-Pay (P2P) product line, which has seen explosive growth and adoption by major enterprises like Northwestern Mutual, Toast, and Coinbase. The funding will also support expansion into new product lines to address evolving market needs. * Establish the Zip AI Lab to continue to rapidly develop and deploy cutting-edge AI solutions that integrate effortlessly with legacy enterprise systems. Zip's existing AI suite has already dramatically improved procurement processes across legal, security, finance, and IT teams. * Broaden global expansion with a particular focus on the EMEA region where Zip has already seen over 200% growth in the past year. Zip will leverage its new London office and expanded EMEA team to meet surging demand across the UK, Germany, and France. This expansion will solidify Zip's position as the go-to procurement solution for large enterprises worldwide. "Zip is one of those rare opportunities in enterprise software that doesn't come along often," said Jay Simons, General Partner at BOND, who previously served as President of Atlassian (NASDAQ: TEAM). "What sets Zip apart is its relentless focus on customer success and product innovation, which in today's tough macro environment, is exactly what enterprises need to drive efficiency and rein in costs. The team has built a product so essential that it's quickly becoming the go-to platform for the world's biggest companies. We're confident Zip is primed to be a staple in every Fortune 500 tech stack." As Zip continues to push the boundaries of what's possible in procurement technology, it remains committed to its core vision: to create a world where every business can access the suppliers and resources they need to operate at peak performance. This innovative approach has not gone unnoticed, with Zip recently recognized as a Leader in the IDC MarketScape: Worldwide SaaS and Cloud-Enabled Spend Orchestration 2024 Vendor Assessment (doc #US51795424, September 2024). With this latest funding round and industry recognition, Zip is poised to redefine the future of B2B spend and cement its position as the global standard for procurement orchestration. Zip was represented by Goodwin Procter for this financing.

Procurement Startup Zip Valued at $2.2 Billion After $190 Million Funding Round | PYMNTS.com

Procurement startup Zip secured $190 million in Series D funding, increasing its valuation to $2.2 billion (up from $1.5 billion in 2023). The investment is one of the largest in procurement technology in more than 20 years, according to a Monday (Oct. 21) press release. As companies face increasing pressure to optimize spending and manage risk, procurement goes under the microscope because, in many cases, it's the second-largest expenditure after payroll, the release said. "Procurement is broken," Zip CEO and co-founder Rujul Zaparde said in the release. "Companies are wasting billions of dollars and countless hours navigating byzantine approval processes, dealing with security risks and manually entering data. Zip has already proven that we can fix that, saving our customers billions of dollars and thousands of hours of time -- and our new round of funding will allow us to continue to revolutionize business spending." Zip plans to use the capital to enhance its research and development efforts, focusing on building advanced procurement software in-house, the release said. This includes expanding its Procure-to-Pay (P2P) product line. Additionally, Zip will establish a Zip AI Lab to accelerate the development of artificial intelligence solutions that integrate with existing enterprise systems, per the release. The funding will also support Zip's global expansion efforts, particularly in Europe, the Middle East and Africa (EMEA), where it has experienced over 200% growth in the past year, according to the release. Zip integrates workflows across various departments -- such as legal, IT, security and finance -- facilitating collaboration throughout the procurement lifecycle, the release said. The funding round was led by BOND, and new investors included DST Global, Adams Street and Alkeon, per the release. They joined existing backers like Y Combinator and CRV. In April, Zip added new enterprise capabilities to its intake and procurement orchestration platform and intake-to-pay suite. Zip Premier is designed to help businesses manage compliance, strengthen integrations with other tools and scale faster. "Developed alongside our largest enterprise customers, our new capabilities streamline the entire spending process, delivering enterprise-grade performance with consumer-grade flexibility so our customers can drive compliance and scale with speed," Zaparde said at the time.

AI procurement platform provider Zip raises $190M, boosting valuation to $2.2B - SiliconANGLE

AI procurement platform provider Zip raises $190M, boosting valuation to $2.2B Artificial intelligence-powered procurement orchestration platform company ZipHQ Inc. revealed today that it had raised $190 million in new funding on a $2.2 billion valuation to accelerate research and development, develop AI-driven procurement solutions and expand globally. Founded in 2020, Zip offers an AI-powered procurement platform that streamlines and automates the purchasing process for businesses. The company provides a single platform for managing the entire procurement lifecycle, from intake to payment and does so by integrating with existing business systems like enterprise resource planning and vendor management tools. Zip's platform uses AI to automate workflows, extract data from documents and detect risks in contracts, reducing manual work and errors while allowing teams to focus on more strategic activities. The platform also offers real-time collaboration features that guide employees through the procurement process while ensuring all stakeholders remain informed throughout the approval stages. The company's AI assistant helps employees submit procurement requests more efficiently, while the platform's integration with existing systems allows for the management of vendor data, contracts and payments. The result delivers faster purchasing cycles and increased control over company spending. Additionally, Zip helps businesses proactively mitigate third-party risk and optimize their spending. Through early visibility into procurement requests and AI-driven insights, Zip says that their service helps organizations drive better decisions and save both time and money in the procurement process. Zip has seen strong growth, recording a three times increase in large enterprises using its platform over the last year. Notable customers include Snowflake Inc., Discover Financial Services and Sephora USA Inc., who Zip claims have collectively saved over $4.5 billion in procurement spending. BOND Capital Management LP led the Series D round, with DST Global Ltd., Adams Street Partners and Alkeon Capital Management, along with existing investors Y Combinator Management and Charles River Ventures, also participating. "Companies are wasting billions of dollars and countless hours navigating byzantine approval processes, dealing with security risks and manually entering data," Rujul Zaparde, co-founder and chief executive officer of Zip, said in a statement. "Zip has already proven that we can fix that, saving our customers billions of dollars and thousands of hours of time -- and our new round of funding will allow us to continue to revolutionize business spending."

AI-Enhanced Procurement Startup Zip Locks Up $190M At $2.2B Valuation

The round values the San Francisco-based company at $2.2 billion. In May 2023, Zip locked up a $100 million Series C at a $1.5 billion post-money valuation. Zip helps companies with the burdensome process of buying new software and hardware, helping customers with sourcing, approving and paying for business tools. "Zip is one of those rare opportunities in enterprise software that doesn't come along often," said Jay Simons, general partner at Bond. "What sets Zip apart is its relentless focus on customer success and product innovation, which in today's tough macro environment, is exactly what enterprises need to drive efficiency and rein in costs." The company will use the new cash to invest in engineering and research and development, including a new internal AI lab to create new AI-powered tools. The money also will be used to expand geographically. Founded in 2020, the company has raised more than $371 million, per Crunchbase. Procurement falls under the broader umbrella of enterprise resource planning -- software systems that help enterprises run processes in departments such as finance, human resources and supply chain. ERP startups have not seen huge funding dollars in recent times, according to Crunchbase data. In 2023, startups in the sector raised only $240 million in 62 deals. So far this year has been slightly better, with $314 million raised in 32 deals. Zip's raise last year was the largest in the space in 2023, and its new funding round is the biggest so far this year.

Zip Funding Round Boosts Valuation Path to $2.2 Billion

AI Procurement software startup Zip finishes its latest series D funding round with $190M, boosting its valuation to over $2 billion. Zip Co-Founder and CEO Rujul Zaparde joins Ed Ludlow and Caroline Hyde on "Bloomberg Technology" to discuss their latest funding and future. (Source: Bloomberg)