Late last month Volition announced their $11M Seed round in TechCrunch which NVP co-led with Quiet Capital. As a fund focused on B2B SaaS products, and thematic concentrations in marketplaces and supply chain, Volition is a perfect fit for us. Not only does the founding team have the right mix of start-up and industry experience, but their mission, “to make hardware development as easy as software development” is an opportunity that we simply couldn’t resist.
Volition is a B2B marketplace for “off-the-shelf” parts and components used in industrial manufacturing. (Think parts for motors or engines, hydraulic tools, electronic sensors and switches, etc.) It’s a marketplace designed specifically for the needs of the hardware development world, and its goal is to “accelerate the pace of hardware innovation by serving as the hub that organizes all of the world’s components.”
Organizing the world’s components is critical for the industrial manufacturing production process – which is currently a deeply complicated and wildly outdated one. Creating a piece of hardware or manufacturing product – such as an industrial robot – requires the creation of a Bill of Materials (BoM)–an exhaustive list of the necessary parts along with detailed specifications of these parts. Each part of the list must then be procured based on the specifications, qualified suppliers and available supply, cost, etc. BOM lists can be extensive (thousands of parts), and the sourcing of each item is time-consuming. Only a hodgepodge of rudimentary tools exists to assist in the search, discovery, and validation of parts. A small number of legacy suppliers dominate the market – characterized by limited selection, lack of transparency, and high cost. Those with online catalogs offer them in the form of static PDF documents (without price or availability) requiring significant phone/email supplier interaction.
Not to mention, that the designing engineer themselves is often responsible for this procurement process. When there are changes to the specifications of a part (e.g. due to design, availability, price, etc) all the involved engineers, procurement professionals, and business people for the product need to be notified and sign off on the details of the change.
You can imagine the significant problems and inefficiencies that exist within each of these steps: Expensive engineering time is spent sourcing parts; time is often disproportionately spent on low-value items rather than the small number of high-cost, high-value ones. Further time is wasted dealing with part/spec changes; incorrect parts and extra parts are ordered; unit cost and quality are sacrificed in the name of just getting the ordering done to meet deadlines, and so much more.
When the VC world talks about a process being “ripe for disruption” this is the scenario that we are imagining.
The Volition team has a deep understanding of the pitfalls of the industrial manufacturing production process. Not only did they all previously work together at Plethora creating the world’s first “self-configuring” factory, but they consider themselves “lifelong hardware hobbyists” with Nick building race cars, Natalie creating metal sculpture and jewelry, and Duffy with carpentry and construction. Their drive to make manufacturing production easier, more transparent, and more efficient is what put Volition into motion.
Today, customers can use Volition to search across the largest collection of parts and components ever assembled (over 16M and growing), and then filter down to the products that meet their exact specifications.
To do this, Volition invented a new kind of product data engine able to upload and standardize a massive amount of supplier product content at a scale never before achieved. This system uses automation and AI to empower human experts to create a high-quality catalog which has been impossible to do in the past. By solving this problem, Volition is able to organize the entirety of this industry’s products and make them searchable and purchasable in one place.
This platform plays on three core trends that our team at NVP is tracking:
- The penetration of e-commerce and digital selling tools into the largely offline industrial/B2B world,
- Supply chain disruption and the move to diversify sources of parts and reshore/ nearshore supplier partners,
- Constrained high-skill engineering resources and the desire to increase their efficiency, especially in part procurement.
NVP’s thesis is that B2B marketplaces need a unique vertical SaaS, data approach, and moat when building these platforms. In the case of Volition, it is their proprietary PIM solution, searchability capabilities, in CAD workflow, and high sku volume that makes the business especially exciting – not only for the old-school manufacturing companies who are playing catch up, but for entirely new 21st-century industries. With the increase of funding in space, deep tech, bioscience, manufacturing, batteries, and EV – Volition stands to make meaningful contributions to these emerging high-growth businesses and technologies.
We believe that the combination of these industry trends, the market opportunity, the product/market approach, and the team, make Volition an attractive investment with high potential for rapid growth.
If you are in the manufacturing production space, or if you are building a related startup that you think we should know about, reach out to Sean@Newark.VC
