“Hard tech” is the latest buzzword in venture capital, but all hard tech industries still rely on software infrastructure to ensure machines work properly, parts are shipped on time, and are built to very precise specifications.
Stell, a two-year-old software startup, focuses on this latter part of the engineering ecosystem. The company has developed a requirements management tool that allows teams to track, verify, and validate requirements across complex projects.
“Requirements management is such a heavy process, heavy workflow, and all the tools right now really fail at the user interface and it’s something that the majority of team members in companies can use,” the co-founder and CEO explained in a recent interview Stell’s advisor, Malory McLemore. .
He should know: McLemore is an engineer by training, with previous jobs at big companies like Airbus and Raytheon, as well as manufacturing startup Hadrian. He founded Stell in 2022 with Anne Wen, a professional with experience in venture capital and launching space startups.
The pair met at Harvard Business School and shared the view that complex engineering was overwhelmed by bureaucracy and inadequate workflows. They imagined something different: a tool that was actually useful and user-friendly, that cut down on red tape, and that engineers would actually want to use.
McLemore and Wen raised one $3.1 million pre-seed last January to execute on this vision, which includes an entire ecosystem where people can communicate, identify and track requirements all the way to the customer.
Now, more investors have backed Stell’s vision. Last month, the company closed a $4 million round led by Long Journey Ventures and Cyan & Scott Banister, with participation from Third Prime, Wischoff Ventures, Urban Innovation Fund, Forward Deployed VC and Fulcrum Venture Group, as well as a select group of angel investors.
Stell originally planned to release a tool to digitize specifications and technical contracts – almost like a purchasing or supply chain tool – so that, for example, a company buying parts could create that technical contract in Stell (vs. PDF) . While this was still in the works, McLemore and Wen realized it wasn’t the best place to start.
So they turned — a decision McLemore said was customer-driven — to compete directly in the claims management category and ship that product first. One of the most popular legacy tools in this category is IBM DOORs, which are extremely powerful — but very complex and extremely expensive.
“That worked for the industry a long time ago, but it no longer works in this age of working with different groups. People may not have time to go to a two-week training on how to use a tool,” McLemore said.
Often, even if a company buys IBM DOOR licenses, engineers on the ground still rely on solutions like Excel, Word, or Jira — tools that work fine for smaller teams or prototypes, but quickly fall apart for more complex projects that need more cooperation.
“[DOORs] it ends up being more of an audit log that you do just to check a box because the client told you to, versus a true collaboration platform. That’s really what we’re dealing with. I think it’s hard to compete, mostly because there’s just an inertia because it’s been so long since there’s been a competitor in the space that’s been able to match the workflows that exist in this tool.”
“It can really screw up these big projects and lead to mistakes.”
Stell founders Malory McLemore and Anne Wen
Like many early-stage software startups, the company is learning as it goes. Stell shipped a first version of her product last June to a customer “and it’s been a journey of intense iteration and experimentation, talking to potential customers every week,” McLemore said. “It’s hard to believe how far we’ve come from those initial plans and assumptions we had.”
The next step for the Los Angeles-based startup is to develop its supply chain-focused operations. They are currently actively selling licenses to their requirements management product, which has features such as search, login, licensing, and the ability to display technical contracts as a document and matrix. The search function is particularly important because this is how Stell aims to integrate artificial intelligence. It’s also far from the norm: “When I was an aerospace engineer, I had to know what document number to look for, I had to know what page to go to, I had to have that model in my head of exactly where information was stored in it,” he said. McLemore.
Stell has three early customers, all in the aerospace industry, and the company just received a $1.24 million direct phase II SBIR through the Air Force’s AFWERX program—often the very customer that flows under requirements at aerospace companies .
The team is now six and plans to use some of the new capital to hire a few more engineers and a person dedicated to compliance and cyber security. The new funding will also be used to ship connectivity features, such as sharing digital specifications to suppliers and back to customers, and developing supply chain operations.
In the long term, Stell could even be used in the business development process because it will be a rich repository of specifications and technical data for historical programs. This data could be used to inform future proposals in a more data-driven manner.
“We have all these friends in the industry who feel like they’re bureaucratic engineers, instead of actually building these products and working on these missions to build new space stations or what the US is going to face in the next era,” said McLemore. . “So we consider ourselves indispensable to this mission. So even though it might be difficult to compete with these big software companies, we still think it’s important.”
