Certa, the procurement and compliance vendor management platform, has announced a Series B funding round that raised $35 million. Certa provides an all-in-one toolkit for the complete third-party lifecycle management process. The round was led by Fin Capital and Vertex Ventures Southeast Asia and India, with participation from Tru Arrow Partners. Chainsmokers backed Mantis VC and Justin Kan backed GOAT Capital also participated in the round. The round could have raised twice as much with Certa in the unenviable position of choosing the best offer from interested investors.
Other participants included the existing investors from the $15 Million Series A round and seed funding. These included Point72 Ventures, BDMI, part of Bertelsmann’s corporate venture arm Bertelsmann Investments. As well as the family office of Bernard Arnault’s Aglae Ventures. In total, Certa has now raised around $50 million.
The investors
Enterprise Times asked Certa why the two lead investors stood out with the round oversubscribed. Jag Lamba, CEO and Founder of Certa replied, “Global businesses are facing immense and mounting pressure due to new, complex legislation and regulations. Compliance issues average $14M per incident, which, for most businesses, is catastrophic. As businesses continue to become more interconnected – oftentimes working with thousands of suppliers, partners, and clients – their exposure to risk is increased.
“Thus the need for a comprehensive, all-in-one solution to manage third parties is imperative. Fin Capital and Vertex Ventures, amongst our other investors, immediately recognized the scale of this problem and saw Certa’s ability to solve it.”
Logan Allin, Managing Partner and Founder of Fin Capital and the newest Certa Board Member, commented, “Managing third parties is more than just risk and compliance – customers are looking for a full stack solution. With its ability to redefine how businesses work and grow together, it’s an honor to partner with Certa on their journey as both an investor and board member.”
Allin will also be joined by Piyush Kharbanda, Partner at Vertex Ventures, who will act as a board observer.
Certa meets the supply chain challenge
Modern supply chains are complex. The growing compliance requirements across ESG have rapidly increased the importance of managing them effectively. Certa believes that every relationship adds risks. Those risks include data security, privacy, fraud and carbon accountings. The Uyghur Forced Labor Prevention Act (UFLPA) in the US, the German Supply Chain Due Diligence Act (LkSG) and in February 2023, the EU Directive on corporate sustainability due diligence (CSDD) are indications of the growing complexity of the compliance landscape.
Increasingly, legislation and risk management ensure that it is not just the first level of the supply chain that is important. It is the second and third as well. Organisations must understand their risk profile as the first step to management and mitigation. Certa provides the most comprehensive and intelligent platform for global third-party management across procurement, compliance, ESG, and legal.
Certa already has a growing and impressive customer base. It has helped clients onboard and monitor millions of companies across 120 countries, and the application supports 41 languages. It lists Box, Instacart, Uber, Grubhub, Roku, Abra and Mastec among its customer base. Linda Chuan, VP and Chief Procurement Officer at Box, comments. “Business impact has been tremendous; we’ve been able to reduce our cycle times by over 78%.”
Mark Arrigotti, Head of Finance Operations at Uber, stated, “We’ve been able to reduce our operating costs by 50% year over year and increase our on-time payments from around 40 to 95%.”
Jag Lamba, founder and CEO of Certa, stated, “This investment in a tough economic environment underscores the demand for a more complete, modern solution to manage third-party relationships. It is a testament to Certa’s best-in-class technology and the value we have delivered to clients, many of whom are large Fortune 500 companies. We are energized by the faith put in us by our rockstar investors and believe Certa is poised to be a next-gen category leader in third-party management.”
So, what will Certa spend the funding on?
In the press release, the firm states it will invest in its go-to-market engines and aims to expand into the EU and accelerate adoption. However, the company does not yet have an office in Europe. Enterprise Times asked Certa whether it intends to open one.
Lamba replied, “We are not planning to open a physical office as of now. We chose Europe (inclusive of the UK) due to the increase in regulations we’re seeing coming out of that region. “
It will also invest in its product, including, apparently due to customer demand, investment in generative AI to streamline third-party ecosystems.
Will Certa look to open a new office in Europe? If so, is the decision made as to where, Enterprise Times asked. Besides Generative AI, what other product enhancement will be accelerated by this funding?
Lamba answered, “Certa will add more ESG solutions, and add to its existing Procurement and Compliance solution suites to help all businesses better manage their third parties.”
Enterprise Times: What does this mean?
In recent years, supply chain management has become one of the hottest topics in the boardroom. Only generative AI currently seems to be talked about more. The economic turmoil and global disruption over recent years have left companies unable to rely on spreadsheets to manage their ecosystem. Legislation has meant that understanding the real source of materials is critical. Firms cannot risk the brand damage associated with sweatshops, even if their immediate supplier seems squeaky clean.
Certa is one of the fast-growing, modern supply chain management platforms that helps organisations manage ESG, Contracts, risk and more. This funding should help it expand outside the US. Though it may also need to find a clearer focus for its target market. Its current website indicated little in the way of industry verticalisation.
