Google-Backed Factor Raises $6M in Seed Funding

Supply chain payments and order management platform Factor has raised $6 million in seed funding with the help of Google’s Gradient Ventures fund.

Factor announced the funding Monday (Dec. 13), saying it would use the money build out its new just-in-time inventory financing tool and other features for high-volume manufacturing clients. The company is also hiring for its engineering, product and go-to-market teams.

Based in San Francisco, Factor was founded by Doug Shultz and Michael Szewczyk, who met working on a graduate project at Harvard Business School and Stanford to solve “First Mile” supply chain problem.

That’s a term that refers to the proliferation of manual processes and limited data access in the first steps of production, leading to delays and shortages before shipping.

“Most people hear ‘supply chain disruption’ and think of container ships stalled outside a port. But the overwhelming majority of disruptions happen before goods ship — in the supply chain’s First Mile,” Shultz said in a press release.

“This part of the supply chain transacts trillions of dollars each year and has never been more specialized, but the infrastructure that keeps it running hasn’t kept pace.”

Factor says it now serves more than 250 companies, mostly mid-sized manufacturers, that use its software to reduce the time and resources needed to transition from product design to finished goods.

Read more: Don’t Expect Durable Goods Ordered in 2021 Until 2022 as Supply Chain Snags Drag On

Many sectors — especially those trafficking in electronics and durable goods that need semiconductors — are seeing delivery wait times extend in 2022.

Industry groups say they are becoming more and more concerned about how these long lag times will affect payments and fulfillment of durable goods orders.

“Combined with increased demand for appliances and equipment, supply chain bottlenecks have negative consequences, including increased costs, lost sales, delayed deliveries of critical products to consumers in the face of supply chain backlogs, and even shutting down manufacturing plants,” the Association of Home Appliance Manufacturers, a coalition of four industry groups, said in a statement in October.