Magentic Raises $5.5 Million for AI Agents for Supply Chains

Magentic raised $5.5 million in a funding round to accelerate the growth of its artificial intelligence (AI) agent platform that finds opportunities for savings in global manufacturing supply chains.

For example, when deployed by one of the company’s clients, the AI agents found errors in a quarter of the client’s procurement documents, Magentic said in a Tuesday (July 22) press release. Another client saved 4% on its machinery spare parts procurement.

The company’s procurement and supply chain domain-specific AI agents can find savings even in environments in which the master data is incomplete or inconsistent, according to the release. Its latest AI agents focus on supplier tariff claims.

In a Tuesday blog post, Magentic said its AI agent that focuses on supplier relationship management can identify and resolve issues such as errors in supplier documents, payment terms or contracts missing key element and clauses, and missed savings like volume discounts and inflation adjustments.

“For the first time, we have the technology to understand all our data across previously incompatible systems,” Magentic Co-Founder and Chief Technology Officer Odhran O’Donoghue said in the press release. “At Magentic, we’re motivated by the question: how can complex companies deploy trustworthy, reliable systems capable of following company playbooks to improve outcomes for their suppliers and their customers.”

Magentic has customers in the consumer packaged goods, pharmaceutical and advanced manufacturing sectors in the U.S. and Europe, per the release.

The company’s funding round was led by Sequoia Capital, according to the release.

In a Tuesday blog post, Sequoia Capital Partner Julien Bek and Senior Director, Arc Zefi Hennessy Holland said Magentic’s AI agents partner with procurement teams and act like dedicated employees that review every contract clause, inspect every shipment, verify every invoice and recover leakage when deliveries fall short.

“Procurement team members exponentially increase the scale of their work, all while keeping full control,” they said in the post. “Whether the goal is recouping costs or simply streamlining their supply chain to ship products faster, Magentic can help.”