Zip, a startup that offers AI-powered software for businesses to purchase goods and supplies, has recently closed a Series D funding round, raising $190 million. The funding was led by BOND and saw participation from DST Global, Y Combinator, Adams Street, Alkeon, and CRV. This financing has boosted Zip’s valuation to $2.2 billion, a significant increase from its previous valuation of $1.5 billion back in 2023.
The new capital injection is considered the largest investment in procurement technology in more than twenty years, marking a significant milestone for the company. Zip’s primary mission is to assist businesses in optimizing spending and reducing risks associated with procurement in today’s global economy. As traditional systems become outdated and inefficient, companies are increasingly turning to innovative solutions to streamline their operations.
Zip’s technology aims to replace manual processes and simplify tasks by offering a unified platform for employees to initiate purchase requests. This approach enhances the speed and transparency of procurement processes across various departments such as finance, legal, IT, security, and others. The founders of Zip, Rujul Zaparde and Lu Cheng, who previously worked at Airbnb, developed the technology to address the challenges they observed in business procurement.
Zaparde, a Harvard dropout who co-founded FlightCar in 2013, transitioned to Airbnb after the sale of the car-sharing company’s technology to Mercedes Benz in 2016. Following a period as a visiting partner at Y Combinator, Zaparde teamed up with Cheng to establish Zip. According to Zaparde, traditional procurement methods are flawed, resulting in wasted resources and time due to complex approval processes and manual data entry. Zip’s innovative approach has already demonstrated cost-saving benefits for its clients, including leading enterprises such as Prudential, Canva, Discover, Sephora, and others, totaling savings of over $4.4 billion in less than four years.
Since its inception in 2020, Zip has experienced significant growth, particularly within large enterprises in 2024. The company plans to utilize the new funding to enhance its research and development initiatives, develop advanced proprietary software, establish the Zip AI lab for AI deployment, and expand its global presence to meet the increasing demand in markets such as the UK, Germany, and France. Zip’s commitment to revolutionizing business spending through innovative technology underscores its position as a key player in the procurement software industry.
