Didero is using AI to solve supply chain management at mid-market companies

Supply chain management remains a stubborn problem for many mid-market companies that can’t afford SAP or lack sufficient IT resources to manage a complex program. Didero, an early-stage startup, decided to build an AI-fueled tool to make it easier on them.

Today, the company announced a $7 million seed investment. While it was at it, the startup also announced it was emerging from stealth and making its product generally available.

“We are trying to build an end-to-end suite that allows procurement teams to manage their suppliers across a range of existing point solution markets,” Tim Spencer, product lead and co-founder told TechCrunch.

That involves finding suppliers, negotiating contracts, managing purchase orders, producing invoices and making payments, all while providing detailed analysis and handling background supplier management tasks.

Spencer said as they built the product they wanted to take advantage of AI to help their target mid-market companies compensate for their lack of resources. Whereas large companies can force suppliers to play by their rules, smaller companies don’t have that luxury, and AI can handle a lot of the grunt work.

“One of the huge unlocks here, particularly for our wedge of mid-market manufacturers, is AI. Because in the pre-AI world, it was basically not possible to do a lot of these tasks [in an automated way],” Spencer said.

The company uses a variety of AI models, including OpenAI and Google Gemini, depending on the task or requirement, and they are continually experimenting to see which model is best suited to what they are trying to accomplish. “We’re using a lot of foundational models and APIs that are out there. We’re not creating our own foundational models, but we’re doing a lot of fine-tuning of some of the existing models,” company CEO Tom Petit said.

In addition, he said that they have a few very specialized models that they’ve coded themselves to power things like extracting data from tables, purchase orders or price lists — documents that are key to the procurement process.

Spencer and co-founder Lorenz Pallhuber bring the supply chain expertise. Spencer ran procurement at Markai, a startup he helped found, while Pallhuber spent seven years at McKinsey advising Fortune 500 clients on supply chain and procurement software. Petit brings the technical chops and training in AI and machine learning. He also co-founded Landis, a startup that raised over $200 million and helped renters figure out how to get a mortgage.

The company launched in December and they have been building out the product ever since. The $7 million seed round closed last month. The round was led by First Round Capital with participation from Construct Capital, AI Grant, Box Group, Company Ventures and Conviction. Industry angels also contributed.