Specright Inc., an Irvine-based software company that helps companies in the food and retail packaging industries organize and share their supply chain specifications, has wrapped up a large round of funding.
The 5-year-old software as a service company, or SaaS, just closed an $8.8 million Series A round, led by Chicago-based Pritzker Group Venture Capital.
Additional participation came from a trio of Southern California investors: Laguna Beach-based Okapi Venture Capital, Los Angeles-based Fika Ventures, and Santa Monica-based Mucker Capital.
The Series A financing puts the company’s total funding close to $12 million. Money from the latest round will be used for further product development, and for Specright to expand operations globally.
The company’s cloud-based software allows customers to digitize and share product and packaging specifications at a “DNA level,” according to Chief Executive Matthew Wright.
Items that can be shared using their platform includes detail on how to make a product, which specific ingredients to use, packaging dimensions, and branding and design elements, with the vendors that actually make and prepare the product for the market.
“It’s hard to believe, but most of the critical data required to make, package, sell, and buy goods typically lives in spreadsheets or on employee hard drives,” Wright said. The company’s software essentially extracts, consolidates, and shares that data across various departments in an organization and with external vendors.
Considering large companies can have thousands of different products being produced in different geographic locations and with different regulatory requirements, the need for organization is clear, he said.
Wright said Specright provides a platform so all stakeholders in the supply chain, internal and external, are working off the same up-to-date information, and can collaborate in real time. The platform also uses algorithms to recommend money saving or operational improvements, and allows customers to quickly send bids for new products to existing vendors, and track vendor progress.
Food Base
Another hard-to-believe fact, according to Wright: The company has never lost a customer.
Notable Specright customers include Bakersfield-based Grimmway Farms, the world’s largest carrot producer; El Segundo-based plant-based protein company Beyond Meat; and Los Angeles-based food supplement company Soylent.
In fact, Wright said most customers have expanded to use Specright’s supply chain software in other areas of their business.
Its sales haven’t been disclosed.
The company currently focuses on the U.S., but with the new funding, Specright is contemplating a European strategy, with a possible future office in the United Kingdom, according to Wright.
Closer to home, the company is on a hiring push.
Specright is looking to bring on software engineers, client services employees, and sales and marketing reps at its Irvine headquarters, as well as offices in New York and Chicago.
It plans to double its OC staff this year, from 25 to 50 employees. It’s currently at the Pacifica Court office near the Irvine Spectrum Center mall.
Frustration at Inefficiencies
Wright, a 20-year packaging industry veteran, previously held leadership positions at Memphis-based International Paper, Austin-based Temple Inland, and Santa Ana-based RightPAQ—a packaging company he co-founded.
In 2014, he founded Specright out of his frustration with the inefficiencies and costs related to low quality specifications from customers.
Pritzker Group Venture Capital Partner Gabe Greenbaum, who will join Specright’s board as part of the funding agreement, said in a statement the SaaS company is “creating a multibillion-dollar market within the packaging industry and beyond.”
“As investors with deep roots in the manufacturing and supply chain ecosystem, we’ve seen the pain and inefficiencies caused when business units, vendors, and suppliers aren’t on the same page due the traditional siloing of data,” said Greenbaum, who works out of the VC firm’s Los Angeles office.
The venture capital firm got its start with joint offices in Seal Beach and Chicago in the early 2000s under the Pritzker Group LLC name, it was founded by brothers from the Pritzker family, owners of the Hyatt hotel chain and one of the wealthier families in the country.
It’s invested in other OC firms, and late last year was part of a $17.5 million Series A funding round for Buena Park’s Rael Inc., a maker of natural feminine-care products.
Specright previously received $3 million in pre-seed and seed funding with participation from Okapi Venture Capital.
Marc Averitt, a managing director at Okapi, said in a statement he is “very excited to support their growth and help them expand their footprint.”
“The company has grown a diverse customer base with both Fortune 100 companies and challenger brands taking advantage of its capabilities,” Averitt said.
Wright said that Specright’s software is continuing to evolve, and the company will soon release Vendor Exchange, a capability that allows customers to find new vendors to partner with directly from the platform.
This will help automate the process of bringing a new product to market, or expanding production into a new state where current partners aren’t operating. VX, as it’s known internally, is currently in beta testing and will launch by the end of the year.
