MUMBAI: Zetwerk, a business-to-business platform for custom manufacturing, has raised $9 million in a Series A round from new investor Accel Partners, as well as existing investors- Sequoia Capital and Kae Capital.
Founded by Indian Institute of Technology (IIT) Madras alums Amrit Acharya and Srinath Ramakkrushnan, Zetwerk is a technology platform for on-demand manufacturing of custom products. On the demand side, it works with mid-to-large OEM (Original Equipment Manufacturers) companies from India and South-East Asia, who require procurement of custom products and machine parts which are not available off-the-shelf in the market.
On the supply side, it works with manufacturing SMEs, across categories such as fabrication, machining, casting, forging, etc) who can meet this demand.
The startup’s goal is to build the world’s largest procurement platform focused on manufacturing, said co-founder and CEO Acharya. It will use the funds to invest in technology to connect to SMEs, which today largely operate in a non-tech based model, he said.
“There are lakhs of manufacturing SMEs in India today, majority of them have good skills in manufacturing, but lack skills in marketing and project management." co-founder Ramakkrushnan said. “OEMs globally want to procure from these SMEs but lack a technology platform to discover which SME can meet their quality and delivery criteria - Zetwerk aims to solve this through our platform," he added.
Zetwerk currently works primarily with clients in the oil and gas, power, renewable energy and infrastructure businesses. Its clients include Embassy Office Parks and Thyssenkrupp among others.
Zetwork raised a $1.2 million seed funding round from Kae Capital and Sequoia in August last year.
“Today if you want to order a $5 bag of tea you can find the best one online and it’ll ship to you from anywhere in the world. But if you want to order or sell a factory part worth thousands of dollars, there’s very little visibility into where to find the perfect
part or buyer," said Prayank Swaroop, partner at Accel. “Zetwerk aims to solve this important global problem by bringing information symmetry, efficiency and cost effectiveness," he added.
B2B startups have seen strong investor interest in the past year or so, with a record breaking $3.09 billion in B2B startups across 415 rounds in 2018. This was 28% more than the $2.41 billion allocated in 2017, across 534 rounds, according to data tracker Tracxn.
The larger B2B space comprises smaller sub-segments such as trucking and logistics, software as a service (SaaS) and robotics, which attract funding. These are present across early and late stages. Some of the bigger names in the B2B space include trucking logistics firm Rivigo and software provider Freshworks.