Procurement, the strategic process of procuring products and services to carry out duties within the company, is becoming more and more difficult for businesses to manage.
According to a recent survey by spend management solutions provider Ivalua and procurement network Procurious, 32% of procurement teams acknowledge having “cut corners” in response to pressure from executives to address issues “more quickly and effectively.”
Three entrepreneurs, Sudhir Bhojwani, Lalitha Rajagopalan, and Yuan Tung, created Oro Labs. This platform synchronizes supplier management and procurement processes across various systems and data to assist businesses in overcoming some of these obstacles.
Procurement management software is a highly competitive industry that is expected to grow from $6.15 billion in 2021 to $13.80 billion by 2029, according to one report. Levelpath, Pivot, Pando, and Zip are just a few of Oro’s competitors. Furthermore, several market leaders are starting to intrude, such as Ramp, which recently announced that it will provide procurement solutions, services, and products targeted at clients at the corporate level.
However, investors seem to be confident about Oro’s development possibilities. Oro recently revealed that it has secured $34 million in a Series B round headed by Felicis, in which B Capital, XYZ Venture Capital, Norwest Venture Partners, and others participated. Oro has raised $60 million in total. According to CEO Bhojwani, the money will expand the company’s operations and clientele and create a “range of new use cases” for the Oro platform.
“Instead of building a standalone product, Oro strategically chose to build its initial offering as a workflow platform, allowing companies to adapt usage to a range of business challenges, from procurement to things like supplier fraud prevention, invoicing and more,” Bhojwani said in an email interview with TechCrunch. “Oro is already collaborating with several Fortune 200 clients to address these and other supplier-related issues.”
In 2020, Bhojwani, Rajagopalan, and Tung collaborated to create Oro following several years of collaboration at SAP Ariba. Bhojwani claims that throughout their time there, they developed an awareness of the typical difficulties companies face while using procurement software.
“The inadequate experience for suppliers and employees is the fundamental issue,” he declared. “Within enterprises, the procurement department has a terrible reputation generally. Put, business users perceive procurement as a “slow-moving, take-too-long” impediment to completing tasks.
In keeping with the same theme, a Statista survey reveals the most common procurement management problems that businesses encounter. These problems include handling intricate approval and purchasing procedures, spending time balancing invoices, ensuring that departmental spending guidelines are followed, and managing rogue expenditures.
On the bright side, though, procurement is becoming increasingly popular inside the company. Nearly 70% of chief procurement officers surveyed by EY in 2022 stated that their teams’ top objectives are shifting to supplier and third-party risk management and that procurement plays a more significant role in delivering business goals.
Oro’s solution consists of a collection of no-code tools that can be used to build processes for risk management, supplier onboarding, and invoicing. The platform provides dashboards that aggregate data from many procurement-related systems and apps in one location, along with templates for standardizing procurement decision-making processes.
“‘Agility’ is the primary benefit of Oro at a high level,” Bhojwani informed me. The platform’s versioning functionality and no-code engine, intended for procurement, make it simple to divide the administration duties among IT, process owners, and contributors. The Oro platform’s simple interoperability with current technologies is another significant advantage. It must only create new integration recipes or use preexisting ones to expand Oro operations.
Oro claims to have expanded its customer base by more than 400% last year. The company now employs 90 full-time personnel in the U.S., India, and Europe, aiming to increase employment to 100 by the end of the year. According to Bhojwani, annual recurring income ranges from $1 million to $10 million.
In response to a question concerning the effects of macroeconomic headwinds on Oro’s near-term strategy, Bhojwani stated that he thought the procurement software market was relatively protected due to the function’s recognized significance in the startup environment. To that end, according to the previously cited EY report, two-thirds of procurement companies are investing more in procurement digitalization to strengthen the supply chain resilience of their businesses.
Bhojwani stated, “Businesses are more concerned than ever with optimizing the return on investments they’ve made in digital transformation.” These days, efficiency, automation, teamwork, and user experience are prioritized. Squeezing every ounce of benefit and efficiency out of existing systems is more critical than embarking on new projects. Solution providers that take care of these issues, in our opinion, will continue to be in a solid position to prosper.