30 Jan Formulate raises 3.7M EUR in late seed round
Today Formulate, a SaaS company focusing on AI solutions for retail promotions, announces they have closed a late-seed round of 3.7m EUR, led by henQ, with the participation of Industrifonden and J12 Ventures. The funds raised will be invested in international expansion and growing the team.
It began in 2016 with a pile of research papers and a consultancy project focused on analysing a retailer’s sales data. The founders of Formulate soon recognised that the need to improve promotion analysis within retail was huge. Most analyses and forecasts were done on gut-feel alone, without proper tools to manage, analyse, and visualize quantitative results in order to make data-driven decisions. Since then, Formulate has designed, developed, and begun to sell Retail DecisionCloud, a cloud-based AI SaaS solution. Current customers include leading Swedish retailers, such as Coop and Apoteket.
The additional 3.7m EUR will be used to introduce Retail DecisionCloud to the European retail market. To accelerate growth by expanding into several European countries, Formulate was keen to find a European lead for the round.
“It all came together when we met henQ. Their fund is focused on B2B enterprise software, they are skilled in supporting companies like ours in international expansion, and they know what is required to eventually enter the US”, says Andreas Willgert, CEO of Formulate. “Right now, we are super focused on bringing Retail DecisionCloud to the European market. Retail as an industry is changing, and leveraging data is at the core of that change. Retail analytics is a 3bn EUR industry, and it is rapidly growing. Our promotion analytics solution is tackling a classic retail problem with state-of-the-art technology, and the potential to create value is significant.”
Together with henQ, two other firms have participated in the round; the well-established Swedish evergreen fund, Industrifonden, which already has equity in the company, and the newly created Stockholm-based fund, J12 Ventures.
”We believe that the market opportunity is huge and the problem that Formulate solves is really significant for the retail market. I think in a couple of years’ time we’ll look back and say that the team at Formulate has initiated a gigantic change in how retail is executed”, says Coen van Duiven, Founding Partner at henQ. Promotions are important to retailers, often 20-50% of turnover is discounted or in other ways activated. However, determining whether or not promotions are profitable, and whether they truly drive incremental sales after all side effects are accounted for, has, until now, proved very difficult. By using Retail DecisionCloud, users get a comprehensive analysis of all their past promotions, and reliable forecasts of all their planned promotions. They can also simulate the effect of promotions in the ideation phase. This enables retailers to continuously improve and to collaborate with suppliers in an innovative way. Formulate is based in Stockholm. The growing team of almost 20 is a mix of skilled tech and retail professionals. The three founders, Andreas Willgert (CEO), Arvid Stenback (CRO) and Robin Bartholdson (CTO), together with early hire Anna Blomdell (CPO), make up the company’s leadership team.