Atomic Raises $12.5 Million to Automate Supply Chain Decisions With AI
Boston-based supply chain startup Atomic has raised $12.5 million in a Series A round led by Klass Capital and Madrona Venture Group, bringing its total funding to more than $15 million as it expands an AI platform designed to automate inventory, purchasing and storage decisions.
AI platform targets supply chain decisions
Atomic is developing an AI-powered platform that helps companies manage inventory and automate purchasing and storage decisions.
The system simulates different scenarios, determines appropriate product quantities and storage locations, and then recommends the best course of action or executes the decision automatically.
The latest funding round was led by growth investment firm Klass Capital and Madrona Venture Group. The capital will support Atomic’s expansion, further development of its platform and efforts to serve companies across multiple industries.
Startup roots trace back to Tesla
Atomic was founded by Michael Rossiter and Neil Sweidan, who developed the idea while working at Tesla. In 2018, the two were involved in building an early system for supply chain decision-making during the production ramp-up of the Model 3.
At the time, traditional spreadsheets could no longer keep pace with the speed of changes required for planning, prompting the development of a system capable of handling a larger number of supply chain scenarios and decisions.
Since the beginning of this year, Atomic’s annual recurring revenue has increased about fivefold as the company moved beyond early trials and began working with larger customers, including DoorDash and HelloFresh.
DoorDash uses Atomic for purchasing operations across hundreds of locations, with the platform now handling about 90% of its purchasing activity, according to Atomic. The shift represents a move from providing recommendations to employees toward independently making operational decisions.
Expansion beyond food companies
Atomic’s platform helps food businesses reduce waste and product spoilage by improving inventory levels and more accurately identifying demand. The company is also expanding into consumer goods, manufacturing and mobility.
Atomic has appointed Jeff Goodrich, a former Tesla operations planning executive, as its chief technology officer, making him the company’s third founder alongside Rossiter and Sweidan.
The platform analyzes a large number of potential supply chain decisions and identifies more efficient paths while adapting to each company’s operating model and internal systems.
Atomic has also developed tools designed to shorten implementation time. Its technology can identify decision-making rules followed by employees even when those rules have not been formally documented.
The company aims to expand its customer base across multiple industries by leveraging the platform’s ability to adapt to different operating models as businesses increasingly turn to AI to improve inventory and purchasing management and reduce operating costs.