Written by 10:05 am AI Business

– Vertice Secures $25M Funding for AI-Powered Software Cost Management

When you say the phrase “expense management” in a business context, people might think …

When discussing “expense management” in a business setting, many individuals associate it with tools like Concur that monitor expenditures on business-related activities such as travel and entertainment. This software is commonly utilized by finance teams to oversee expenses throughout the organization. The perception may be that this issue has already been effectively addressed.

However, a new player in the field, Vertice, is approaching expense management from a more detailed perspective, focusing specifically on software expenditure. Recently, the startup secured $25 million in funding, indicating both market demand and the evolving landscape with the integration of AI and other technologies.

The funding round, spearheaded by 83North and Bessemer Venture Partners, who also led the startup’s previous \(26 million round, was structured as an all-inside round to maintain strong relationships with existing investors. Vertice, co-founded by Roy Tuvey and his brother Eldar, boasts a valuation in the "hundreds of millions of dollars," showcasing impressive growth with only \)51 million raised to date.

While specific revenue figures were not disclosed, the company’s annual recurring revenues are now in the double-digit millions, with a seven-fold increase in ARR in 2023.

The Tuvey brothers bring a successful track record to the table, having previously sold security startup ScanSafe to Cisco for \(200 million in 2009 and Wandera to Jamf for \)400 million in 2021.

Vertice’s focus lies in addressing the challenges surrounding SaaS and cloud expenditure, which are projected to be the largest and fastest-growing segments of IT expenses for businesses globally. The rapid expansion of cloud offerings has outpaced the tools available to effectively monitor procurement, usage, management, and planning, leading to inefficiencies and redundant spending.

The company’s platform combines automation, AI capabilities, and human oversight to analyze spending and usage patterns across its customer base, totaling more than $1 billion in tracked expenditure. This data enables finance teams to gain comprehensive insights into their expenditure, identify areas of inefficiency, and optimize their software utilization.

Vertice’s platform not only aids in cost optimization but also emphasizes security, leveraging the founders’ IT security background. The tool assesses how software packages align with a company’s security compliance standards, offering a holistic approach to expense management.

Looking ahead, Vertice plans to expand its tracking capabilities beyond AWS to include Azure and GCP, recognizing the growing importance of efficient cloud spend management, particularly in the realm of AI services and compute power.

In a competitive landscape, Vertice faces competition from established players like SAP, as well as emerging startups focusing on software expenditure tracking. The platform’s unique value proposition lies in its emphasis on cost efficiency, security compliance, and tailored insights for finance teams across various industries.

Investors like Bessemer Venture Partners recognize the value proposition of Vertice, particularly in helping companies optimize non-payroll expenses and navigate financial challenges without compromising operational efficiency. The platform’s ability to deliver tangible savings and positive feedback from CFOs underscores its potential impact on businesses of all sizes, from startups to tech giants.

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Last modified: January 19, 2024
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