Demantra Secures More Venture Financing

  • Written By: Steve McVey
  • Published On: October 17 2000



Demantra Secures More Venture Financing
S. McVey - October 17, 2000

Event Summary

Demantra recently announced that it has raised $19.5 million in its second round of venture capital funding. Formula Ventures led the investor group that includes: The Challenge Fund, The Intel 64 Fund, Shamrock Holdings, and Jan Baan's Vanenburg Group. A product of Boston's fertile high-tech incubator, Demantra makes software for collaborative demand management, sales and marketing support, and replenishment planning. The cornerstone of its suite is a solution supporting Collaborative Planning, Forecasting and Replenishment (CPFR) guidelines as published by the Voluntary Inter-industry Commerce Standards organization (VICS). CPFR is a methodology by which trading partners collaborate on building consensus forecasts for customer orders and replenishment orders. Demantra plans to use this round of financing to continue to expand its sales and marketing capacity and foster new product development initiatives.

According to Yoni Cheifetz, CEO of Demantra, "Demantra has established itself as a global expert in collaborative demand management Solutions for the Demand-Driven Interprise™. Successful companies have always understood the importance of using the best tools available to help them anticipate, plan and respond to customer demands within their marketplace. This is our core business. Aided by this new capital, we will provide our customers with collaborative B2B planning solutions and services, allowing them to capitalize on the opportunities offered by the new world of e-business."

Market Impact

The willingness of private equity firms to divert precious capital to Demantra speaks well for the company but is also a strong vote in favor of CPFR. CPFR stands to grow proportionally as a component of the larger business-to-business (B2B) market, which some analysts expect will reach $1 trillion by 2002. As the Internet continues to play an important role in extended supply chain management among business entities, success of initiatives like CPFR will pave the way for new standards of communication between companies. As private investors continue to pour money into CPFR-based companies, we expect to see more collaboration software companies appear on the horizon in response. Tangible improvements in efficiency that have been demonstrated by retailers like Wal-Mart Stores, Sara Lee Corporation, and Circuit City using CPFR will further contribute to the growth of the CPFR and broader collaboration software markets.

User Recommendations

For users who either buy products from a supplier or sell them to customers, adopting CPFR and the tools necessary to support it makes perfect sense. In spite of the confidence shown by its new benefactors, Demantra is a relative newcomer to CPFR and users should consider its along with offerings from more experienced CPFR vendors such as Logility and Syncra Systems. Users who are already using ERP systems from J. D. Edwards, Baan, or QAD and are exploring possibilities in CPFR should ask about Demantra's strategic partnerships with these vendors. As always, users need to conduct a thorough analysis of vendor capabilities divorced from market hype, especially in selections involving CPFR and other Internet-enabled business processes.

 
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