Flowlity: Better and faster inventory optimisation. Why we invested.

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Flowlity: Better and faster inventory optimisation. Why we invested.

Apr. 21st, 2022

Flowlity: Better and faster inventory optimisation. Why we invested.

In February, we announced our third French-based VC partnership when we led the €5m round funding of supply chain solutions provider, Flowlity.

From the outset, it was clear that the Flowlity team has all ingredients to make it an attractive investment through a smart combination of vision, product, and people. In this article we look at how Flowlity leverages this combination to provide a solution at a time of great market demand, to tell a truly compelling investment story.

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The Flowlity team

When it comes to growing and scaling a company, everything depends on the people involved.

It was clear that Flowlity’s CEO, Jean-Baptiste Clouard, possesses the mindset and soft skills to manage a successful high-growth start-up. He also ticked the two important boxes of leadership and execution. Jean-Baptiste displays maturity in his leadership and avoids the temptation of making the business a one-man show.

Co-Founder Karim Benchaaboun, as CTO, is an equal contributor to the company’s early success. B2B SaaS start-ups succeed or fail based on the technical expertise present in the business, and it is here where Karim excels.

A high-growth scale-up needs to position its people well, and Flowlity continues to get this right. In addition, they provide a technological solution to an important problem, which means all the key ingredients for success are present.

Flowlity’s offering

While there are many supply chain solutions available, most are extremely complex and time consuming to implement. They are able to solve complex problems, but when disruptions occur, the models are not able to capture these changes, or the resulting volatility. Flowlity, on the other hand, can provide quick answers, manage uncertainty, and mitigate disruptions in unexpected situations. And, because it doesn’t require time-consuming training and maintenance, the time to value is much quicker for Flowlity clients.

When we analyse investment opportunities, we find that many start-ups may seem geared for success, only to find that the product lacks scalability. In contrast, Flowlity built a modular solution to provide room for growth for both the company and its customers.

Flowlity distinguishes itself further by offering their solution in the cloud, compared to the on-the-premises solutions of most competitors. This provides them with exceptional scalability and flexibility, while eliminating the risk of running out of capacity on the on-the-premises hardware.

The effect that Flowlity has on sustainability is another important aspect of the product. Whenever a business minimises its stock levels and wastage, its carbon footprint also shrinks. This makes Flowlity a particularly attractive investment, as we consider the effect of a company on sustainability as part of our investment decision-making process.

The supply chain solutions market

All too often, product delays frustrate customers along the length of the supply chain. Global events such as the Covid-pandemic and the war in Ukraine exacerbated matters even further, leading many businesses to look for new suppliers. Stock management is therefore critical for companies to retain their reputation and their customers.

The current double-digit growth in the European supply chain planning solutions market further makes it clear that businesses realise the need to improve their supply chain management. With so many companies investing in better solutions, the potential European market size sits at around €5B. In addition, a Gartner report found that AI integration is a key trend in supply chain planning solutions. Flowlity is therefore offering the right product at exactly the right time.

There is ample potential for new business, as the market is far from saturated. In the mid-market, where Flowlity positions itself for the moment, 80% of companies still use Excel to manage their supply chain. Most of them are now realising the need to digitalise and professionalise their approach.

In our view, the addressable market for Flowlity’s solution is almost limitless.

What the future holds

Given these attributes, Flowlity’s short-term vision to become the fastest-growing supply chain management solution by the end of 2023 does not seem unattainable. An even more ambitious long-term, moon-shot vision backs this up. The company wants to evolve from optimising single customer supply chains to managing the full value chain, from raw materials to the end consumer.

It may yet take some time to achieve this vision, but it underlines the fact that Flowlity is gearing up to become a major global supply chain player, with all the building blocks in place to support our investment decision.

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