Sento, an API that makes sharing business data as easy as using a social network, has secured €9 million in seed funding. Led by US-based VC Insight Partners, with participation from Jan Deepen and Stefan Jeschonnek, co-founders of SumUp, as new angel investors. Previous investors, Picus Capital, the founders of Celonis, Zalando, Checkout.com (via Zinal Growth), and Operator Partners also joined the round.
Munich-based Sento’s mission is to simplify the sharing of data between businesses and enables problem-free connections to 85% of the DACH (Germany, Austria, Switzerland) food retailers and has eight times as many customers as in November 2021. Currently a costly and time-consuming process, integration has changed little since the 90s, Sento automation helps businesses to get straight to the important information. Initial feedback has reflected the platform’s benefits, as noted by Rachel Geller, Managing Director at Insight Partners, “Sento’s overwhelmingly positive customer feedback, strong founding team and vision to revolutionise a highly antiquated space made this investment very exciting for Insight.”
Felix Krauth, CEO and co-founder of Sento, spoke to TFN about the company, its platform, and its plans.
A diverse founding team
The founding team are not, perhaps, a group that might be expected behind an API-based service. Krauth studied architecture, while his co-founders Lucian Riediger and Nimar Blume were a mathematician and an electrical engineer. However, they were all drawn to the startup world.
“We got to know each other at the Centre for Digital Technology and Management in Munich,” Krauth explains. “A lot of tech companies were founded from this programme, and it attracts people with an interest in startups and founding companies. So, we knew we wanted to start something, but there were no concrete ideas.”
After the programme, Krauth found himself on a platform implementation project, his first experience with APIs and integrations. He described the experience as going “really deep into a rabbit hole, then never coming out!” Discussing his experiences with his co-founders, they started to explore integrations in the supply chain.
During their research, they realised that data sharing was a pain point for many businesses. Most integration is focused on internal processes, like linking customer relationship management with email or sales platforms. However, there were no easy integrations for business-to-business requirements, for example, linking buyers with retailers.
Part of this is because there are additional hurdles to overcome. “You don’t necessarily fully trust the other side. And you need to sync more systems,” Krauth explains. “But that’s how we got really excited about the space. We learned that every supermarket shelf, every delivery truck, every Amazon package, is heavily dependent on B2B integration. But the legacy technology still works similarly to the 90s. That’s what got us really excited about building an infrastructure for B2B automation.”
A platform with enormous potential
The dominance of legacy systems means there’s a significant market for Sento’s plug-and-play solution. The company is currently focusing on the food sector in their native Germany, but even then, they estimate the sector is worth €140 billion, providing a significant opportunity before they even start considering expansion.
Krauth illustrates the potential with a retail example. “What happens when you start selling as a brand in a supermarket is you exchange purchase orders, delivery notes and invoices via email — or even fax — or using legacy software integration technologies.” However, the difficulties compound as a brand gains more sales points. “Over time, a brand can collect hundreds or thousands of these point-to-point integrations.”
The next generation EDI platform making B2B data exchange automated and effortless does the hard work of creating the integrations. “You’re connecting once to our RESTful API. And with that, you can send and receive messages like purchase orders, delivery notes, and invoices with all your partners without needing to know what the exact standard looks like.” Sento, essentially, does the work, so their clients can focus on their business, not the transactions.
Its growth since they were founded in January 2021 has reflected the pent-up demand for its solution. Their platform currently processes several million euros of sales each month. And in the six months since their pre-seed round they have increased their customer-base by 800%
Sento plans to use the funding to develop its product. “We want to invest in moving a project-based industry to a product-based solution,” says Krauth. “We have built the core infrastructure, and now we plan to build more components around that, that will enable rapid growth over the next months.” They will be expanding their team, currently eleven-strong, by hiring more engineers and product specialists to support their ambition. However, they are clear that the focus will be on the platform, rather than rapid expansion. “We see a lot of merit in focusing on our core customers, rather than spreading too thinly.”
Santo’s mission is nothing less than to revolutionise the food industry. “Today, companies have to assess the return-on-investment to calculate if it’s worth integrating. We want to move to a plug-and-play world where a non-tech user can set up integrations themselves,” says Krauth.
Although they are starting with an intense focus on the food sector in Germany, Santo’s ambitions are much wider. “Everything we need to prove, we will prove within the food industry,” says Krauth. “We are a very long-term thing company: we want to build the global layer for business-to-business automation.”