Vertice raises $50 million for AI-powered SaaS spending platform

A London startup Summit has made a name for itself in the crowded world of cost management over the years, with companies focused on applying AI to optimize an area that now exceeds hundreds of billions of dollars in IT budgets. 5 trillion dollars per year: software and cloud costs. Now, with Vertices’ business growing 13 times since it was founded less than three years ago (comparable to software spending growth), the startup has raised $50 million in new funding to expand its vision.

“(Vertice) is designed to standardize the processes around how companies buy everything, not just software and cloud,” CEO and co-founder Roy Tuvey said of the platform. “A lot of companies today have very different solutions, different silos that they’re looking at, and procurement teams are generally under a lot of pressure to deliver savings and efficiencies. And they really don’t have amazing technology today. Thus, we have brought it all together in a single and simplified platform.”

New backer Lakestar is leading this Series C with participation from Perpetual Growth and CF Private Equity, as well as previous backers Bessemer Venture Partners and co-led 83North. Vertice B series almost exactly a year ago.

The startup has now raised about $100 million, and while it didn’t disclose a valuation, Tuvey confirmed that’s definitely up from “a few hundred million” 12 months ago. Vertice’s customer base has also grown in size. The list includes hundreds of figures across Europe, the US and Asia Pacific and now includes giant chip ASML, Euronext, Grant Thornton and banking behemoth Santander.

For more context, Vertice has a strong history behind its founders. Roy and his brother Eldar previously founded two security startups: ScanSafe Cisco in 2009 for $200 million; and Wandera, was It was bought by Jamf for 400 million dollars in 2021.

Given how big the software market is — Gartner It predicts that spending on data centers (thanks to the cloud and artificial intelligence), software, and related IT and communications services will grow by more than 9% to $5 trillion in 2025 (devices add another $800 billion to that total)—it shouldn’t It’s surprising that Vertice works in a very crowded part of the enterprise market.

Its competitors include multiple platforms that offer different levels of services around offering similar products, pricing, side-by-side feature comparisons, recommendations and more. Names include companies such as Spendbase, Spendesk, Gartner and G2.

Vertice’s point of differentiation, Tuvey said, is how it integrates with business data to better understand what to offer. Touching on the same approaches you might imagine a cybersecurity company might use to better understand network activity, Tuvey said Vertice is building a system that uses AI and other tools to build a picture of what a company does, how much it typically spends, and more. what they may need or want to buy next.

In fact, the startup has built a “big software procurement model” along the lines of the Big Language Model, where the parameters are the usage of the software, not the facts and concepts expressed in natural language. The company claims to have received about $3.4 billion in SaaS and cloud spending data, benchmarking data on more than 16,000 software providers (none of whom have any financial ties to Vertice, Tuvey confirms when asked). Customers use it both to speed up their purchase process and to save money. The startup says that buying cycle times can typically be cut in half, saving between 20% and 30%.

“We’re ingesting all the contract information through artificial intelligence,” Tuvey said, adding that he’s using the technology to create co-pilots to help with procurement, doing work that finance teams might previously have had to review manually. “We provide the benchmark pricing insights and analytics they need at the point of purchase. AI is really interesting when it comes to procurement orchestration because you can learn what the challenges are in a company’s processes.”

That, in turn, gives Vertice an understanding of how the larger business works, he added.

“For example, if a company always spends a long time on certain steps, such as checking prices, but also checking security compliance, and we can see how we can manage them in parallel and save time,” he said. “And you can imagine having more app ads, AI learning and making recommendations.”

Lakestar partner Georgia Watson, who led the round, said the Tuveys’ background, how they applied it to acquisitions, and ultimately the growth that got investors knocking on the door. At the moment, spending is the most important issue for companies looking to reduce operating costs – this is especially acute for startups, given that they are currently facing funding challenges.

“Some of our portfolio companies are using Vertice,” he said, “because of the pressure on software costs and really needing to reduce that.” It was a conversation we had… and the feedback was very positive.” He said Lakestar had tried to get an investment before and eventually backed out this time.