San Francisco-based startup Response has successfully closed a $4 million seed funding round. This investment underscores the growing recognition of the need for streamlined procurement processes in operations teams across various industries.

The seed funding round is led by Y Combinator, with Twenty Two Ventures, and other notable angel investors and operators from companies including Anduril, Flexport, Ramp, and Scale AI, among others. This capital influx will speed up Response in accomplishing its vision of simplifying indirect spend management – focusing first on third-party logistics providers (3PLs), distributors, and retailers. 

With a vision to revolutionize the way operations teams buy everyday purchases, Response offers a platform designed to centralize and control indirect spending. Unlike procurement platforms that have traditionally focused on infrequent, high-ticket buys, Response targets high-frequency, everyday expenditures, such as packaging, maintenance supplies, and office essentials. 

The platform integrates with nearly 100 top industrial vendors, providing real-time pricing and direct ordering capabilities. It also allows teams to manage their purchase orders with any supplier anywhere in the world, all under one interface. 

Their collective expertise has been instrumental in developing a solution that addresses the nuanced challenges of indirect spend management, providing businesses with the tools needed to control costs and improve efficiency.

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The Challenge of Indirect Spend

Indirect spend refers to the everyday purchases that, while essential to operations, are not directly tied to a company’s core products or services. This category of spending typically consumes 10-15% of a company’s revenue and can quietly erode profits when unmanaged. Many organizations rely on spreadsheets, corporate credit cards, and manual purchasing processes, leading to a lack of visibility, uncontrolled spending, and inefficiencies.

Response’s Solution

Response addresses these challenges by transforming fragmented purchasing processes into a centralized, controlled system. Key benefits of the platform include:

• Increased Efficiency: The platform streamlines the ordering process, making it up to 91.6% faster. This reduction in delays allows teams to focus on strategic tasks rather than administrative duties.
• Savings in Cost Savings through consolidating vendors and products may go up to 13.2%. SKU-level visibility and built-in controls help reduce waste and keep budgets intact on the platform.

“With indirect spend quietly eating into margins and manual purchasing causing inefficiencies, our mission is clear: help companies cut costs and regain control,” said Keivan Shahida, co-founder and CEO of Response. “We’re not just saving businesses money—we’re giving them visibility and control over one of their most chaotic spend categories.”

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Market Potential and Future Plans

The successful seed funding round positions Response to further develop its platform and expand its market presence. The company plans to enhance its integration capabilities with additional vendors, introduce more advanced analytics features, and expand its customer base across various industries. 

By providing a solution that brings transparency and control to indirect spend, Response aims to become an indispensable tool for operations teams striving for efficiency and cost-effectiveness.