tracking merchandise in physical stores
When it comes to commerce innovation, physical retail often feels like it gets the short end of the development stick against newer, faster-growing, more quantifiable (and still far from perfect) digital channels. But physical retail is far from disappearing altogether, and today a company that’s built a solution very specifically targeted at improving data around in-person merchandise sales is announcing a big round of funding as it moves ahead on some major rollouts it has inked with retailers — a sign of how things are changing, and the appetite that the market has for that.
Nexite, which has developed a radio-powered tagging system and corresponding data platform to read and parse information related to those tagged items, has raised $67 million in a Series C round of funding, and $100 million overall, money that it plans to use both for R&D as well as to roll out services to its first customers.
“We solve our customer’s biggest pain point, which is a lack of real-time data in physical stores,” Anat Shakedd, the CEO who co-founded the Tel Aviv-based company with her husband Lior, said in an interview. She describes Nexite’s solution as the “only tech in the market” that doesn’t require a battery to be able to transmit substantial data at a long-range.
This latest tranche of money has been co-led by Pitango Growth and Saban Ventures, with previous backers Battery Ventures, Intel Capital, Pitango First, and Vertex Ventures also participating. Prior to this Series C, Nexite has been relatively under the radar while working on its technology and deals with its first customers.
2021 App Store Award Winners and Most Downloaded Apps of the Year
PitchBook notes that with this round before it was fully closed and only at $53 million, Nexite’s valuation was just over $340 million. Now with the Series C at $67 million, that would give the startup a post-money valuation of just under $356 million. The company declined to comment on the figure when asked but a separate, reliable source said it’s actually just under $500 million.
Nexite’s early customer list speaks to a strong start in selling its concept and product to the market. Shakedd said that the startup has two major retailers signed up with “full roll-out agreements” that will cover more than 1,000 stores and 80 million tags on items annually when they are implemented. She added that Nexite has further signed agreements with “four of the largest retailers in the world” — no names disclosed — that are in different phases of development, and is having discussions with 20 other large retailers.
The gap in the market that Nexite has been targeting is that physical retailers today operate in a kind of data desert — they set out items and sell them, hope for success, and have often huge amounts of stock that doesn’t sell; it’s a lot of trial and error with a few bits of observation and historical data thrown in to understand why — and yet by being physical locations they are essentially sitting on a mother lode of useful data if they can tap into it better.
tracking merchandise in physical stores
