The seed funding round was led by Nexus Venture Partners in participation with other angel investors and founders
Covvalent plans to utilise the proceeds of the funds to build its product and business teams
Founded in 2022, Covvalent is a tech-enabled managed marketplace for specialty chemicals
B2B tech-enabled and managed marketplace for specialty chemicals, Covvalent, has raised $4.3 Mn in a seed funding round led by Nexus Venture Partners.
Angel investors and founders such as Vishal Chaudhary (cofounder, Zetwerk), Ramakant Sharma (founder, Livspace), Rajesh Yabaji (founder, BlackBuck), Rehan Khan (MD, MSD India Region), Jawaid Iqbal, Anubhav & Ankit Singh (cofounders, Rupifi) and Kaushal Soparkar (founder, Meghmani Group) also have participated in the Covvalent funding round.
The US and Gurugram-based startup was founded in 2022 by Sandeep Singh (a Harvard Business School and IIT Kharagpur alum) and Arush Dhawan (an IIM-Ahmedabad and IIT-Kharagpur alum). Covvalent solves cross-border core supply chain issues, including supplier discovery, delivery delays and quality rejections.
As explained by Singh, specialty chemicals as a sector is undergoing a transformation phase driven by globalisation, technology, and logistics growth. However, opportunities have also created complexity, making it difficult for procurement teams to find quality suppliers. Further, a fragmented supplier base and a lack of supply chain transparency make it even more challenging.
“Covvalent is solving the problem of a fragmented ecosystem in the specialty chemicals space with a vision to be the most trusted partner for its buyers and their procurement needs. We plan to deliver solutions for our customers by integrating technology with strong on-ground operations, assuring timely delivery and quality,” Singh added.
Dhawan further looks at technology to be the core differentiator for the startup, which enables them to deliver a smooth buying experience, while bringing transparency in supply chain and automating quality controls.
The startup currently deals with 253+ chemicals, serving 6+ industries across applications such as ink, textiles, plastics, paints & coatings, and cosmetics.
The funds will be used to strengthen technology infrastructure, hiring across international business, technology, and product developments. It also aims to sharpen its technology tools to ensure a precise match between customer specifications and a supplier’s output while improving experience for the clients around cross-border commerce, including on-time delivery of products with complete visibility of the supply chain.
As per Covvalent, the global specialty chemical market is worth $800 Bn and growing at ~6% annually.
Further, India is expected to double its specialty chemicals market share in the next five years, according to a March 2022 CRISIL report. As mentioned, the industry will grow its global market share to ~6% by 2026 from 3-4% in fiscal 2021.
