Katana, an ERP for SMB manufacturers, raises $34M

In a Series B round of funding, the company has raised 35 million.

A form of business management software that can serve any number of functions inside a company is called enterprise resource planning. It's important to integrate any software as it typically involves taking data from different systems and generating insights and analysis to improve efficiency.

There are prebuilt integrations for many of the most common tools that a manufacturer might use, including e- commerce platforms and accounting. To ensure that they don't run out of stock or parts, a manufacturer can use historical or real-time sales data to predict what their future needs will be.

The image is from Katana.

End of ‘made in China’ era

Demand for such software is being driven by direct-to-consumer (D2C) manufacturing, which has seen smaller, local manufacturers remove many of the intermediaries that were traditionally necessary to get their products made.

The rise in D2C manufacturing has led to a small manufacturing renaissance, giving consumers a wealth of options that reduce the hold of brands. The brands that rely on local production and inventory are gaining market share. The era of'made in China' is coming to an end.

Modern technologies such as 3D printing and computer-aided laser cutter have allowed companies to produce goods on a smaller scale. The emergence of online marketplaces, e- commerce software, and the broader cloud computing movement has made it easier to assume greater control of the entire business process.

Vilosius said that manufacturers have a tech stack of tools. There is a lack of a central source of truth that streamlines the flow of information and reduces manual data entry.

Legacy software from the likes of Netsuite and SAP are geared towards larger businesses, which is why we've seen a lot of younger upstarts enter the scene in recent years.

It's important to support this new wave of manufacturers because enterprise business suites like NetSuite and SAP come with hefty costs and a lot of features that exceed the needs of small to medium-sized businesses. It is known for poor user experience and user interface. Despite being error prone and difficult to scale, many small businesses choose to use spreadsheets.

The majority of the $16 million raised by the company came via its Series A round last year, and in the intervening months the company claims to have doubled its annual recurring revenue. Customers can build their own integrations with the company's openAPI.

The company is well-financed to bring manufacturing software into the digital era, which will include rolling out more advanced accounting integrations.