Lio’s co-founders know firsthand that procurement—the process businesses use to buy services from suppliers—is often a stumbling block. Vladimir Keil, the company’s co-founder and CEO, had faced this problem as an employee at a large company and then again while building his first startup.
“When we were selling enterprise software, we had to go through the procurement ourselves, and we saw how manual and fragmented the process still is,” he told TechCrunch. Kiel and his team have created an automated platform of artificial intelligence agents—software that can complete tasks on behalf of humans—to help fix some of these fragmented processes.
On Thursday, Lio announced a $30 million Series A round led by Andreessen Horowitz. SV Angels, Harry Stebbings and YC also joined the round (Lio was part of the Spring’23 batch). The company has raised $33 million in funding to date. Keil said the new capital will be used to expand the company across the US and increase the capabilities of Lio’s AI agents, which aim to complete the entire procurement process for enterprise customers.
Procurement is at the heart of business spending, where companies try to buy everything from raw materials to professional services. Every purchase order requires focus and commitment: Usually some type of Enterprise Resource Planning, or ERP, software has to be opened, contract management systems checked, supplier database searched, compliance checks performed, budgets cross-referenced, emails searched, etc.
“Even with modern e-procurement software, most of the actual work is still done by hand,” Keil told TechCrunch. Companies are left to build large internal teams or outsource this work, resulting in a slow, expensive process. Keil had an idea – if the procurement process is largely unstructured data and repetitive workflows, then surely this is the kind of work an AI agent is well equipped to handle.
He teamed up with friends Lukas Heinzman and Till Wagner, and in 2023, the trio launched Lio, a virtual procurement workforce. Lio operates an artificial intelligence platform with representative infrastructure that completes the entire procurement process
“Every previous generation of procurement technology was built on the same premise, that people will do the work and technology will help them do it faster,” Keil said. “We’re taking a fundamentally different approach. Instead of building software to help people make supplies faster, Lio is building AI agents that run the workflow themselves.”
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These Lio agents work between and on top of enterprise systems to read documents, evaluate suppliers, negotiate terms and complete transactions. “Processes that once took weeks can now be completed in minutes,” Keil said, adding that the startup already helps companies manage billions in business spending. “In one case, a global manufacturer was able to automate 75% of its outsourced procurement operations within six months.”
Lio is among the many companies that have emerged to completely redefine enterprise software, with the help of agent AI’s ability to fundamentally change the way enterprise application software works.
Keil sees Lio’s competitors as legacy procurement software vendors (such as SAP Ariba and Oracle), Business Process Outsourcing (BPO) providers, and consulting firms that help companies with these functions.
“Instead of spending most of their time processing requests and paperwork, teams can conduct more negotiations, analyze more suppliers and capture savings opportunities that would otherwise be missed,” said Keil. “Over the long term, we believe this changes procurement from a back-office function to a much more powerful driver of business performance.”
