AI-Enhanced Procurement Startup Zip Locks Up $190M At $2.2B Valuation

Procurement startup Zip saw its valuation jump 47% after raising a $190 million Series D led by Bond.

The round also included new investors DST Global, Adams Street Partners and Alkeon Capital, along with existing investors, Y Combinator and CRV.

The round values the San Francisco-based company at $2.2 billion. In May 2023, Zip locked up a $100 million Series C at a $1.5 billion post-money valuation.

Zip helps companies with the burdensome process of buying new software and hardware, helping customers with sourcing, approving and paying for business tools.

“Zip is one of those rare opportunities in enterprise software that doesn’t come along often,” said Jay Simons, general partner at Bond. “What sets Zip apart is its relentless focus on customer success and product innovation, which in today’s tough macro environment, is exactly what enterprises need to drive efficiency and rein in costs.”

The company will use the new cash to invest in engineering and research and development, including a new internal AI lab to create new AI-powered tools. The money also will be used to expand geographically.

Founded in 2020, the company has raised more than $371 million, per Crunchbase.

Procuring investment

Procurement falls under the broader umbrella of enterprise resource planning — software systems that help enterprises run processes in departments such as finance, human resources and supply chain.

ERP startups have not seen huge funding dollars in recent times, according to Crunchbase data.

In 2023, startups in the sector raised only $240 million in 62 deals. So far this year has been slightly better, with $314 million raised in 32 deals.

Zip’s raise last year was the largest in the space in 2023, and its new funding round is the biggest so far this year.

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Illustration: Dom Guzman