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- Onebeat raised $15 million to grow in the US.
- Onebeat uses AI to help retailers plan inventory efficiently.
- It aims to reduce the number of unsold products without going out of stock.
Onebeat, an Israel-based startup that uses AI to help retailers optimize their inventory, announced Tuesday it had raised $15 million in a funding round led by Schooner Capital.
Goldratt Consulting created Onebeat in 2014 when the firm sought ways to use software to improve its clients’ supply chain operations. It officially spun out of Goldratt in 2018.
Onebeat aims to help retailers plan inventory efficiently so that large quantities of products do not go unsold.
The latest funding brings Onebeat’s total raised to $30 million. It plans to use the new funds to officially expand to the US market.
“Retail is the most complicated business because you have to worry about product, about managing people, about marketing, about operations, supply chain,” cofounder and CEO Yishai Ashlag said. “You don’t really have a lot of room for mistakes.”
Onebeat began with building advanced statistical models that eventually evolved into machine learning and AI.
“Our key algorithm where we use AI is to basically do noise and signal separation,” Ashlag said. “Are we really seeing, in the small data of day to day, a trend that we should react to, or is it just a noise we should ignore?”
See the pitch deck Onebeat used to raise its latest round of funding:
Onebeat aims to help retailers optimize their inventory to match customer demand.
It was founded as a division of Goldratt Consulting in 2014.
It follows principles established by the firm’s founder, Eliyahu Goldratt, who detailed them in his book “The Goal.”
That includes the “theory of constraints,” which emphasizes finding the factors that limit business growth.
The idea for Onebeat came from Goldratt’s work with leading consumer brands.
Onebeat spun out of the consulting firm in 2018.
The retail world has grown increasingly complex in recent years, Ashlag said.
Many household names have gone bankrupt due to industry-wide disruption.
Ashlag said consumers want quick delivery and lots of choices. Retailers trying to meet their demands often end up creating waste.
With large store fleets and online shopping to consider, deciding how much product to make and where to place it can be too complex for humans to do efficiently.
Onebeat’s algorithms learn customers’ behavior and adapt accordingly.
Onebeat seeks to learn “the distribution curve for every store, for every product, in every category, and act on that to avoid shortages and to give better customer service,” Ashlag said.
He said Onebeat can improve the proportion of inventory that retailers sell.
It can help make recommendations about replenishing store collections and special sales events.
Onebeat’s customers include American Eagle and Crocs.
Ashlag says the company has helped retailers to increase sales while reducing inventory.
Onebeat considers Blue Yonder and Nextail among its competitors.
The company’s leadership team has experience in retail and software.
“Inventory is a double-edged sword,” Ashlag said. “If you find a way to manage it well, it can really uplift your business.”
Read the full article here
