When COVID shut down much of the world in 2020, it ended up wreaking havoc on the supply chain. Suddenly companies built for just-in-time production couldn’t find parts they needed to build their products.
Even as COVID subsided, the supply chain woes continued. Veterans of supply management like the founder of startup Amplio watched, and figured there had to be a better way to guard against these kinds of disruptions in the future using software to find parts wherever they were.
Amplio launched last year with that goal in mind, and today the startup announced a $6 million seed to build a system to help track parts shortages. Trey Closson, CEO and co-founder at Amplio, says his company’s goal is to build more resilience into the electronic components supply chain.
“We help our customers understand the components that are at highest risk of leading to material shortages, and then we connect our customers to alternative sources of supply to mitigate those shortages,” Closson told TechCrunch.
He knows what he’s talking about. He spent his entire career in supply chain management, and he’s seen firsthand how disruptions can have a negative impact on a business’s ability to function. He blames “just-in-time production” techniques for the problems we are seeing today.
“The supply chains have been designed for 30 or 40 years to optimize for cost and for the best-case scenario, but the reality is that we don’t live in a world of best-case scenarios. We live in a world of constant disruptions,” he said.
“The way that our platform works is that we’re connected to our customers’ systems of record or their ERP solutions, and we take in their bill of materials and their operational data, and then combine that with external datasets to be able to show the customer their ability to source their particular components over the next six to 18 months,” he said.
What’s more, in cases where the customer isn’t able to source the components, customers can go to the Amplio marketplace to find suppliers or other manufacturers who might have surplus inventory they are trying to sell.
Closson’s most recent job was working at Koch Industries, leading international supply chain for Georgia Pacific, where he was on the front line of the COVID-induced toilet paper shortages. But he decided to focus his startup on electronic components.
“So while supply chain resilience is really critical across the market, we want to focus on the electronics industry, because it has such a tremendous impact on the global economy,” he said. He conceived of and incubated the company as part of a program run by Koch and High Alpha Innovation, the program launched by former Exact Target execs to help startups with enterprise-focused ideas.
The company currently has six employees, but plans to expand with the funding (which closed in May). He says as he grows the company, diversity and inclusion is a core building block. “Diversity is one of the core principles for our hiring and in decision making processes. So just from a selfish standpoint, diverse organizations make better decisions and have more creative ideas, and are ultimately more successful,” he said.
Today’s round was led by Construct Capital with participation from Slow Ventures, High Alpha Capital, Flexport Ventures, Alpaca Venture Capital and various industry angels.