Loop raises $95M to automate supply chain back office — 30% of invoices are wrong and it's a $5B manual industry

hanging out with your customers and appreciate the perspective. Let's uh let's do it again soon

and good luck out there. We'll talk to you soon.

Thank you. Have a good one.

Have a good rest of your day.

Uh up next we have Matt McKini from Loop. He's the co-founder and CEO raising a big series C in the waiting room. Let's bring him into the TV and Ultradome. Matt, how you doing? What's going on, guys?

Not too much. Good to have you here. Uh, first time in the show. Why don't you introduce yourself and the company?

I'm Matt McKenna. I'm the co-founder and CEO of Loop. And our mission is to unlock value that's trapped in the operations that power the physical economy. And we started specifically in the back office where no one else wanted to go and back office services and automating things like accounting and junior ledger coding and and payment services. And all we do to exist is to make our customers more efficient so that they can better serve their customers. And we work with some of the most important companies in the world. 20% of the Fortune 100.

Wow.

And excited to be on with you guys.

Yeah. Well, uh, how I mean there there's a different world when you say like uh procurement or accounting that you could have been like we're a aentic accounting firm or something and it feels like this is much more crossfunctional. uh how are you actually positioning like the integration? Who's the buyer? How how does the uh how does the business like instantiate itself inside of your customer?

Yeah, we started we started with a very acute problem which is

if you look at the supply chain industry, yeah, roughly 30% of invoices are wrong or they have an error. So clearing of them is really painful. Y and because of that a bunch of services firms popped up, specialized services firms popped up.

Sure. And all they do is address uh address that specific problem which is you got to adjudicate this invoice. You got to ensure that it's accurate. You got to remit payment to the truck drivers and the carriers across the world. And that's a big industry. It happens to be a $5 billion industry alone. And it's all done with human labor. And obviously LLM's presented a perfect opportunity for that. But I think what got my co and I most excited is really the data. If you can go organize the data, then you can obviously automate things like we just mentioned the accounting, but you can use that as a wedge to expand into adjacent use cases, whether it being compliance or planning or procurement and continue to unlock value for your customers.

Yeah. So, uh, what does it look like for a customer to actually onboard? I imagine you need access to their emails, like the actual PDFs of the invoices, whether things have gotten paid. There's often like multiple versions of a particular invoice and then you need to plug into bank data to see what what's actually moved around or accounting systems like how long does it take to integrate and how key is that? It's w I mean what's so wild about supply chain? Supply chain is just a network of networks.

Yeah.

And you've got, you know, a a transportation carrier, you've got a supplier. You could have multiple versions within your own enterprise. Some a lot of these big companies, they do a bunch of M&A. And so you've got all these different versions of the truth. So just take for example the weight and dimensions of a package or shipment.

There could be seven different versions of the weight and dimensions for that package. And so you need almost like a a data auditor itself to prove that that's the correct data. And we get it from a bunch of different sources. We get it from, you know, email, we get it from EDI, we get it from uh API connection, we get it from Excel spreadsheet, PDF, you name it. It's just really messy, unstructured data. Data that no one's ever organized. Quite frankly, no one was able to organize until the power of LLMs came out. Uh does when you talk to customers, do they care about the AI buzzword at all?

Yeah. Are they trying to buy AI

or do they just want a solution? Like how are you thinking about how how front and center AI is in your value prop and pitch?

All our customers want is just outcomes.

Yeah.

And they don't really care how you deliver it. Now, sometimes they might have a top- down AI mandate.

Sure. that they're looking to check the box, but at the end of the day, they don't care how the sausage is made. They're buying an outcome. That's all that they want. And if you can demonstrate that you can deliver a superior outcome, it's better, it's faster, you're, you know, for example, you're finding more errors or whatnot and faster resolution time so you can close your books faster, that's what they're buying. They're not buying agentic buzzword fit into their, you know, their checkbook. They they really want to buy the value.

Yeah. What is the value of like getting this business to scale? Is there is there something where you can you know optimize the supply chain, introduce different clients that need to different resources and help them buy the best product at the right time or reviews or even just like panel data of like how the economy is moving. We've seen that from some financial some fintech companies. Uh like how are you thinking about the value that's unlocked as you become a platform? Yeah, there's more. You mentioned like procurement for example. There's more obviously when you you have a bunch of data that you can use and say this is good, this is bad or you should be working with the supplier and you're not because we see it over here. But I think that you know really building context across the network is probably where we see the most gains where you can take learnings from a carrier that's working with you know supplier that's working with multiple parties in the network and then say oh well this carrier always likes to build a specific way and so propagate that learning through the LM's context across all the all the companies that work with that carrier. I think that's really I'd say the unlock and automation that you get at scale. And then obviously the you mentioned the intelligence one, the time to value. You're able to get someone on much faster because you're working with 95% of their suppliers instead of 2% of their suppliers. That's a huge win as well.

What were you doing before this? Did you always have a love for back office supply chain optimization?

I I I I can tell you I can tell you he has since he was a bull.

I came out of the womb and I just said, I want to automate the back office.

Yeah. complex and

yeah I I've always just been obsessed with the systems and making them more efficient and I think

you know when you look at the physical world I mean it's supply chain you know the trucks and the train that stuff's just so exciting you feel like it's the last frontier where you can truly unlock value I mean look supply chain alone just in the US is 11 trillion in spend

wow

you know one of the largest trillion huge yeah

yeah if you want if you want to have an impact on GDP going too high.

Sorry, I was giving you that for the 11 trillion. You said the biggest number. So,

if you want to if you want to have an impact though on GDP, at the end of the day, GDP growth is just productivity growth and technology is the leading advantage in that. You're you're saying 11 trillion in spend goes to supply chain and no one's really touching that, then we got to go attack that problem.

Yeah. Uh yeah, I have so many more questions, but uh

but before Yeah. Before that, we were my co and I were at Uber and early on the freight team. And we saw a lot of the, you know, the real world there where

you had messy PDFs, you had billadings, proof of deliveries, just a total data mess to be honest with you. And we knew that there had to be a better way.

Yeah,

dude. Perfect perfect VC pattern match. Uber freight team.

Yep. It's a great team. Great company. We know so many entrepreneurs that came out of Uber. Uh, tell us about the round. What's what's going on? How much did you raise?

We raised $95 million. Couldn't pull together that last five.

That last five. What was going on?

It evaded you. It evaded you.

Sandbagging. Sandbaging.

No, you had to set up had to set up the next round figure a little bit for the next one.

Yeah, exactly.

We're super excited.

Really? Where you guys? Where are you guys based?

Valor at Trades AVC Founders Fund Index, JP Morgan. Wow, you got everybody.

You got everything.

Congratulations.

Wait, where are you guys based? Sorry, I missed. based in San Francisco. You got offices in Chicago as well as in New York.

Is that because Chicago is a major like logistics hub with the trains and trucks and stuff?

Yeah, there's a lot of there's a lot

there is there is a major I'm not making this up, right? Like with the boat because the boats come through the the the lakes and like it it was like a major hub of transactions.

Is that because Chicago has trains and trucks?

They do. They do. This is real, right? Am I wrong?

You're not you're not wrong. I'll give you stats. So 30% of goods that enter America go through Chicago.

Thank you. Thank you. 30%. Not bad.

That was right. You're like, "Oh, Chicago. Why is such a weird pick?" It's not. It makes a ton of sense.

Well, great to meet you, Matt. Congrats to the whole team and hopefully hopefully you're back on the show uh