Tacto secures €50 million to build future-proof supply chains for small and medium-sized enterprises

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• Tacto is an artificial intelligence (AI)-based operating system for building future-proof supply chains in small and medium-sized enterprises.

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• Leading investors Sequoia Capital and Index Ventures invest €50 million to tackle the complexity of industrial supply chains with technology

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• The financing is a confirmation of Tactos' customer-oriented approach, which Procurement real time and cost advantages in Procurement – this is also reflected in customer loyalty, as not a single customer has yet terminated the cooperation.

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Munich, December 12, 2023 – Tacto, the AI-based operating system for future-proof supply chains in medium-sized businesses, has received €50 million from leading investors Sequoia Capital and Index Ventures. Existing shareholders Visionaries Club, Cherry Ventures, and UVC Partners are also participating in the financing round.

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André Petry (CEO & Co-Founder, Tacto): "Increasing regulation and disruptions in supply chains pose major challenges for our economic backbone, small and medium-sized industrial companies: the cost base is rising, material supplies are at risk, and the business outlook is uncertain. Tacto is developing a software solution for future-proof supply chains for and in collaboration with small and medium-sized enterprises in response to the challenges of today and tomorrow. The financing round is a vote of confidence in our product, our team, and our customers. The additional capital will enable us to continue investing in our technology to help our customers remain competitive amid the ever-increasing complexity of supply chains."

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Procurement the key to solving supply chain problems, but affected companies often lack the right tools. Around 50% of the costs of an average industrial company arise from Procurement production materials. The complexity of managing hundreds of production-critical suppliers and tens of thousands of materials is enormous. Due to the lack of suitable tools, the majority of purchasing organizations in medium-sized companies still rely on manual processes and decentralized, error-prone Excel spreadsheets. The increasing challenges in supply chains in recent years, such as wars, climate change, regulation, and inflation, have made it clear that European industry must future-proof its supply chains in order to remain competitive.

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Tacto is the answer for medium-sized industrial companies as an operating system for future-proof supply chains. The AI-based software enables strategic supplier management, uncomplicated handling of compliance with ESG regulations, and efficient and sustainable material purchasing at optimized conditions. This allows manual supplier processes to be intelligently automated. For example, customers are empowered to implement the Supply Chain Due Diligence Act (LkSG) in a legally compliant manner and without additional personnel costs. At the same time, Tacto's AI can identify cost savings of up to 10% of the purchasing volume by continuously evaluating all data along the supply chain (e.g., cost drivers such as raw material and energy prices).

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Matthias Schlotter (Purchasing Manager, Schwäbische Werkzeugmaschinen): "Tacto is our partner for the digitalization of purchasing, from the automation of supplier management to negotiation support for cost savings. Without Tacto, we would have to hire several additional people in times of skilled labor shortages to counter disruptions and comply with increasing regulations. With Tacto, we can focus on value-adding topics. For example, we can analyze all supplier data and cost drivers in real time to prepare for a supplier visit at any time at the touch of a button, which leads to significant time and cost savings."

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Tacto's customer portfolio consists of medium-sized industrial companies from all sectors that manufacture a diverse range of physical products, from board games and cleaning agents to tunnel boring machines. These companies manage several billion euros in purchasing volume and hundreds of thousands of suppliers through Tacto. The customer-oriented approach based on measurable time and cost advantages in Procurement also Procurement in customer loyalty, as not a single customer has ever terminated their cooperation with Tacto. This convinced leading global investors Sequoia Capital and Index Ventures that Tacto is the solution for future-proof supply chains in medium-sized companies. Both investors share a strategy of investing early in leading companies and helping to build them up over the long term.

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Luciana Lixandru (Partner, Sequoia Capital): "Given the unprecedented pressure on global supply chains, industrial companies are aware that their suppliers are just as strategically important as their customers. After closely analyzing the Procurement challenges faced by Procurement industrial companies in recent years, we recognized that future-proof supply chains are one of the most pressing issues of our time and that Tacto is developing a real technological solution to this problem. When we met André and the team, we knew that Tacto would be the company to revolutionize Procurement these companies. Germany, with its strong SME sector, is the ideal place to start."

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Carlos Gonzalez-Cadenas (Partner, Index Ventures): "Supply chains have been severely strained by a wide range of macroeconomic and regulatory challenges and the increasing complexity of globally networked production. Many companies are struggling to manage everything at once, especially given the continuing shortage of skilled workers. Tactos' product uses AI to help companies optimize their multitude of supplier relationships and materials, reducing complexity and saving costs. We look forward to working with André, Johannes, Nico, and their team to respond to the growing demand."

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The newly raised capital will be used to accelerate product development and make significant investments in AI. The goal is to help customers automate all manual supplier and compliance processes, proactively achieve savings by optimizing purchasing costs, and reduce emissions through sustainable procurement. Tacto intends to further expand its strong customer base in the industrial SME sector in order to create future-proof supply chains together with its customers.

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About Tacto

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Tacto develops an intuitive, data-driven, and automated solution for building future-proof supply chains in medium-sized industrial companies. The AI-based software offers customers a transparent overview of their procurement activities, algorithmically highlights risks and potential savings along the supply chain, and automates transactional processes in procurement and supplier management so that customers can focus on what matters most. The company was founded in 2020 by André Petry, Nico Bentenrieder, and Johannes Groll. The product was developed in a co-innovation with medium-sized industrial companies. Procurement now Procurement more than 40 people with expertise in AI software development and experience in Procurement .

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About Sequoia Capital

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Sequoia supports today's most ambitious founders in building unique companies from idea to IPO and beyond. Our goal is to be the first partner of tomorrow's most promising and successful companies. Each year, we partner with a select group of exceptional companies and commit ourselves to providing them with the support they need at every stage of their development. Our expertise comes from 50 years of working with outstanding founders such as Steve Jobs and Larry Page. In total, companies supported by Sequoia account for more than 25% of the total value of the NASDAQ. Since our founding, we have made the majority of our investments on behalf of non-profit organizations and schools such as the Ford Foundation, the Wellcome Trust, and Oxford University. This means that most of the returns benefit these important causes.

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About Index Ventures

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Index Ventures works with outstanding founders from seed to IPO to help them turn disruptive ideas into global companies that have a long-term, positive impact on the world around us. Index supports companies with an experienced team of investors, strategists, and an extensive global network that can look back on three decades of experience in venture capital. As a global fund with a strong presence on both sides of the Atlantic, Index works as an integrated team from San Francisco to New York and from London to Tel Aviv. With a global mindset and international team, Index believes that founders and startups can come from anywhere and succeed. When founders succeed, they make a significant contribution to Index's investors, which consist primarily of charitable foundations in the fields of education, health, and research, as well as other impact-oriented organizations.

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About the founders and the founding history

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The three founders, André Petry (CEO), Johannes Groll (CPO), and Nico Bentenrieder (CTO), met while studying at the Center for Digital Technology and Management (CDTM) and the Technical University of Munich (TUM) and studied together at UC Berkeley. All founders shared the belief that collaboration between tech startups and small and medium-sized enterprises (SMEs) represents an enormous opportunity for Europe as an industrial power. When industrial companies faced an existential threat due to the collapse of supply chains caused by the COVID-19 pandemic, Tacto was founded to provide a technological solution aimed at future-proofing supply chains and keeping production running. André Petry, CEO, has experience in supporting industrial organizations with transformation, particularly Procurement, using AI at BCG and appliedAI. Johannes Groll, CPO, has a background in AI research at TUM and experience in optimizing business-critical processes in industry at Palantir. Nico Bentenrieder, CTO, has a background in research & development and Procurement BMW.

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About Visionaries Club

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Visionaries Club is a leading European venture capital firm specializing in early-stage investments, with offices in London and Berlin. The Visionaries LP base brings together the strongest network of leading unicorn founders and family entrepreneurs, such as the founders of UiPath, Miro, Wolt, Flixbus, Supercell, Zalando, Mollie, Spotify, Personio, Adyen, HelloFresh, as well as dynasties such as Swarovski, Miele, Mittal, Haniel, Stihl, Siemens, and personalities from the world of sport who are active in VC, such as Mario Götze (soccer world champion) and Nico Rosberg (Formula 1 world champion). With its entrepreneurial LP base and B2B investment focus, Visionaries bridges the information asymmetry between "what is possible in the technology startup sector" and "what is actually needed in the industrial sector."

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About Cherry Ventures

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Cherry Ventures is a leading European early-stage venture capital firm founded by entrepreneurs with years of experience in scaling startups such as Zalando and Spotify. The Cherry team invests in Europe's most daring founders, typically as the first institutional investor, and supports them with dedicated in-house functions on topics ranging from market entry strategy to company scaling. Cherry Ventures has already invested in over 100 seed-stage startups across Europe, including now world-renowned companies such as FlixBus, Auto1 Group, Flaschenpost, Moss, The Exploration Company, Forto, SellerX, and Juni. With offices in Berlin, London, and Stockholm, Cherry Ventures' investment focus spans various industries and regions across Europe.

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About UVC Partners

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UVC Partners is a leading early-stage venture capital firm based in Munich and Berlin that invests in European B2B tech startups from the pre-seed to Series A stage. With approximately €400 million in assets under management, UVC Partners typically invests between €500,000 and €10 million as an initial ticket and up to €30 million per company. Its portfolio includes leading companies in the fields of deep tech, climate tech, hardware and software, and mobility. As an independent partner of UnternehmerTUM, Europe's largest innovation and start-up center, UVC Partners has access to proprietary deal flow, an industrial network of more than 1,000 companies, and access to talent from Europe's leading technical university. Its investments include Flix, Vimcar, planqc, Tanso, Isar Aerospace, TWAICE, DeepDrive, STABL, and many more. They all benefit from the team's extensive investment and exit experience, its ability to build sustainable industry leaders, and its passion for developing the game changers of tomorrow.

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Tacto's financing round in the media:
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Handelsblatt: Simpler than Excel: Tacto wants to use AI to secure the supply chains of medium-sized companies‍

Business Insider: Munich startup Tacto raises $50 million from Sequoia and Index

Börsen-Zeitung: Munich-based start-up Tacto wins over renowned investors

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Tacto, the AI-based operating system for future-proof supply chains in medium-sized businesses, has received €50 million from leading investors Sequoia Capital and Index Ventures. Existing shareholders Visionaries Club, Cherry Ventures, and UVC Partners are also participating in the financing round.