In the good old days, companies could afford to buy tons of supplies in advance and wait for the deliveries to show up whenever they did. But with the economic slowdown, manufacturers are keeping inventories smaller, and a delay in supply is now a lot more serious. With $20 million in hand, San Jose, Calif.-based Apexon Inc. is trying to eliminate supply delays.
“You no longer treat your supplier as a supplier but rather as an extension to your enterprise,” says Ram Chandra Sekaran, a founder of the Apexon, which has developed software that helps warehouses manage relationships with their suppliers. “You don’t own the assets of the supplier, but you want their assets to follow your processes as if they were yours.”
Apexon’s software gives suppliers around-the-clock Web access to manufacturers’ inventory, production levels and delivery schedules in real time, virtually eliminating all excuses for suppliers to miss deadlines.
While Apexon claims to have a solid customer base, its only announced client is Garrett Engine Boosting Systems, a manufacturer of turbochargers and air management systems for large truck engines based in Torrance, Calif. that generates $1.4 billion in annual revenue. In just over one year, Garrett claims that it has already seen a 90% return on its investment in Apexon’s software. Additionally, the company will announce two more customers next month.
The round was led by Accel Partners along with Foundation Capital. The deal included investments from earlier investors Menlo Ventures and Rolling Thunder Network.
The company plans to use the proceeds from the deal to expand its sales and marketing division.
Matt Holleran, Apexon’s chief executive, says, “Under conservative assumptions, Apexon may not need another private equity funding round.”
As a result of the deal, Jim Breyer and Peter Fenton, both from Accel, joined Apexon’s board of directors.
Founded in March 2001, Apexon has raised a total of $31 million. In the round prior to this round the company received a post-money valuation of $27 million.