Levelpath, Founded by Scout RFP Veterans, Secures $55M Series B to Revolutionize Procurement with AI

Levelpath Secures $55 Million Series B to Transform Procurement with AI and User-Centric Design

In a significant move signaling strong market confidence, Levelpath, a burgeoning force in the procurement software landscape, has announced the close of a $55 million Series B funding round. This substantial investment was spearheaded by Battery Ventures, a firm with a notable track record in the enterprise software space, including early backing of procurement giant Coupa. The round also saw continued support from Levelpath's existing investors, Benchmark and Redpoint, who previously led the company's seed and Series A rounds, respectively. This fresh infusion of capital is earmarked to fuel Levelpath's ambitious growth plans, including a projected quadrupling of its revenue within the current year.

Levelpath's journey is particularly compelling given the pedigree of its founders. The startup was established by Stan Garber and Alex Yakubovich, the visionary duo previously behind Scout RFP. Scout RFP, a prominent online procurement platform, achieved a significant exit in 2019 when it was acquired by Workday for a reported $540 million. Following the acquisition, Yakubovich and Garber spent three years integrated within Workday. This period provided them with invaluable insights into the persistent, often frustrating, challenges that large organizations face with their procurement processes and the software intended to manage them. It was this firsthand experience that ignited their motivation to build a new, fundamentally better platform – one designed from the ground up to be mobile-first and genuinely user-friendly.

Addressing the Procurement Pain Points: Why Legacy Systems Fall Short

Procurement, the process by which companies acquire goods and services, is far from a trivial administrative function. In fact, it represents a company's second-largest expenditure, trailing only payroll. Optimizing this area offers a direct and significant impact on the bottom line. Despite its critical importance, the procurement software market has long been characterized by systems that are cumbersome, outdated, and difficult to navigate. Dominated by legacy vendors like Coupa and Ariba, these platforms, while powerful in theory, often create friction for the very employees who need to use them.

The result of this poor user experience is a widespread phenomenon known as "rogue spending." This occurs when employees, frustrated by clunky official systems, bypass approved processes and make purchases using corporate credit cards or other unmanaged methods. As Battery Ventures general partner Neeraj Agrawal points out, this rogue spending leads to significant inefficiencies, including:

Overspending due to lack of visibility and control.
Missed opportunities for bulk discounts and negotiated rates.
Difficulty in tracking expenditures and managing budgets accurately.
Increased compliance risks.

This environment of inefficiency and frustration highlights a clear and pressing need for modern, intuitive procurement solutions. The global procurement software market itself is substantial, valued at $7.3 billion annually in 2023, according to Fortune Business Insights. This large market size, coupled with the evident dissatisfaction with existing tools, presents a fertile ground for disruption by innovative players.

Levelpath's Modern Approach: Mobile-First, User-Friendly, and AI-Powered

Levelpath entered this market with a distinct vision: to make procurement software a tool that employees actually *want* to use, rather than avoid. Leveraging their deep understanding of enterprise needs gained from their Scout RFP and Workday tenures, Garber and Yakubovich designed Levelpath with a focus on user experience and accessibility, particularly emphasizing a mobile-first design. This approach recognizes that modern employees need to manage tasks and approvals on the go, seamlessly integrating procurement into their daily workflows.

Crucially, Levelpath's timing coincided perfectly with the emergence of powerful generative AI technologies. Launching right as ChatGPT debuted allowed Levelpath to integrate AI capabilities into its platform from its very inception. This wasn't an afterthought but a core component of their strategy. AI is being leveraged to tackle some of the most complex and time-consuming aspects of procurement, such as:

**Reviewing Unstructured Data:** AI can quickly parse and understand complex, unstructured data found in contracts, invoices, and other documents, extracting key information and identifying potential issues or opportunities.
**Recommending Alternatives:** By analyzing purchasing patterns and product/service descriptions, AI can recommend less expensive or more suitable alternatives to requested items, helping companies save money and optimize choices.
**Automating Tasks:** AI can automate routine tasks like data entry, matching invoices to purchase orders, and flagging discrepancies, freeing up procurement teams to focus on strategic activities.

This integration of AI not only enhances efficiency but also makes the platform smarter and more proactive, further reducing the friction that drives rogue spending. By making the official procurement process easier, faster, and more intelligent than bypassing it, Levelpath aims to naturally guide employees towards compliant and cost-effective purchasing behaviors.

The Founders' Journey: From Scout RFP Success to Levelpath Ambition

The story of Levelpath is inextricably linked to the long-standing partnership between Stan Garber and Alex Yakubovich. Their connection dates back to high school in Ohio, where they bonded over shared experiences as immigrants from the former Soviet Union and a mutual passion for entrepreneurship. This enduring relationship has formed the bedrock of their professional collaboration, which now spans over two decades.

Their success with Scout RFP, culminating in a significant acquisition by a major enterprise software player like Workday, provided them with invaluable experience in building and scaling a successful B2B software company. However, their time at Workday also exposed them to the persistent limitations of existing procurement solutions within a large enterprise context. They saw firsthand how even sophisticated systems could fail to meet the needs of end-users, leading to inefficiency and frustration.

This experience didn't deter them; instead, it fueled a renewed entrepreneurial drive. They recognized that the fundamental problem of user adoption in procurement software remained unsolved. Their stated goal with Levelpath is ambitious yet simple: to help customers genuinely *enjoy* using procurement software. This user-centric philosophy, combined with their proven ability to execute and their deep domain expertise, makes them formidable players in the market.

Neeraj Agrawal of Battery Ventures highlighted the founders' reputation as a key factor in the investment decision. "They have such a strong reputation for delivering product, being good people to work with, and doing what they say they're going to do," Agrawal told TechCrunch. This trust and positive reputation within the industry mean that "Customers want to work with them and help them build this next-generation product." This speaks volumes about the founders' leadership and the potential for Levelpath to build strong, collaborative relationships with its clientele.

Investor Confidence and Market Positioning

The $55 million Series B round is a powerful validation of Levelpath's trajectory and its potential to capture significant market share. Leading the round, Battery Ventures brings not only capital but also deep strategic expertise in the enterprise software sector. Neeraj Agrawal's personal history with Coupa, having led Battery's Series B investment in that company, provides a direct parallel and suggests a belief that Levelpath possesses the key ingredients for similar success in the next generation of procurement technology. Agrawal has also joined Levelpath's board, further solidifying this commitment and providing valuable guidance.

While Levelpath is currently a newer and likely smaller entity compared to established giants and even some well-funded contemporaries like Zip (valued at $2.2 billion last fall) and Oro Labs, the investment indicates that its rapid growth and innovative approach are resonating. The market is large enough to support multiple successful players, and the demand for modern, efficient procurement solutions is high.

The success of companies like Coupa further illustrates the potential scale within this market. Coupa, which had a successful IPO in 2016, was later taken private by PE firm Thoma Bravo for a substantial $8 billion. This history demonstrates that building a dominant platform in the procurement space can lead to significant financial outcomes.

Levelpath's ability to attract and retain major customers like Ace Hardware, Amgen, Coupang, and SiriusXM early in its growth phase is another strong indicator of its product-market fit and execution capabilities. These are large, complex organizations with sophisticated procurement needs, and their adoption of Levelpath speaks to the platform's ability to deliver real value and address critical pain points.

The Strategic Importance of Procurement Optimization

Beyond the software itself, the investment in Levelpath highlights a broader understanding of the strategic importance of optimizing procurement. In today's competitive business environment, every dollar saved through efficient purchasing directly contributes to profitability. As Neeraj Agrawal succinctly put it, improving procurement software "makes the cash register ring because of these savings."

Companies are increasingly recognizing that outdated, inefficient procurement processes are not just an administrative headache but a significant drag on financial performance. The ability to gain better visibility into spending, control costs, negotiate favorable terms with suppliers, and ensure compliance is paramount. A user-friendly, intelligent platform like Levelpath promises to unlock these benefits, transforming procurement from a cost center into a strategic function that drives value.

The integration of AI is particularly relevant in this context. As supply chains become more complex and the volume of data grows, manual processes become increasingly untenable. AI can help procurement teams make faster, more informed decisions, identify potential risks or opportunities hidden within vast datasets, and automate repetitive tasks, allowing human expertise to be focused on higher-value activities like strategic sourcing and supplier relationship management.

Looking Ahead: Fueling Growth and Innovation

With the $55 million Series B funding secured, Levelpath is well-positioned to accelerate its growth and continue innovating. The capital will likely be used to expand its team, particularly in engineering, sales, and customer success, to support its growing customer base and ambitious revenue targets. Further investment in research and development will be crucial to enhance its AI capabilities and maintain its edge in user experience.

The founders' long-term vision is to fundamentally change the perception and reality of procurement software. By building a platform that is intuitive, powerful, and leverages cutting-edge technology like AI, they aim to eliminate the frustration associated with traditional systems and empower employees to make smart, compliant purchasing decisions effortlessly. Their track record with Scout RFP suggests they have the capability to execute on this vision.

The backing of prominent investors like Battery Ventures, Benchmark, and Redpoint provides not just financial resources but also strategic guidance and network access that can be invaluable for a scaling startup. Battery Ventures' experience in the procurement space, in particular, offers Levelpath a unique advantage as it navigates the complexities of the enterprise market and competes with established players.

In conclusion, Levelpath's successful Series B funding round marks a significant milestone in its journey to modernize enterprise procurement. By combining the seasoned expertise of its founders with a mobile-first, AI-powered approach, the company is directly addressing the pain points that have plagued the industry for years. As Levelpath continues to expand its reach and refine its platform, it is poised to play a key role in the ongoing digital transformation of procurement, helping companies save money, improve efficiency, and empower their employees.