AI startup with Ukrainian roots Competera, which has built an intelligent price optimization platform for retailers, closed a $3 million seed round to scale services supporting multinational retailers, including further expansion in the US retail sector. Powered by a neural network trained on proprietary and industry data, the Competera Pricing Platform is an all-in-one multichannel solution for setting and maintaining optimal prices across the entire pricing life cycle.
Investors in Competera’s seed round include STRATMINDS (a San Francisco-based venture capital firm specializing in applied AI), Flyer One Ventures, Verras Capital, Geek Ventures, SMRK Fund, Transform Partners Fund, and a group of seasoned angel investors, including Alex Medovoi, the Founder and Chairman of AI Ukraine, one of the most significant practical Data Science and Machine Learning conferences in Eastern Europe.
Alex Galkin and Alexander Sazonov co-founded Competera with the mission to revolutionize retail pricing by building a product that offers retailers competitive data with tactical recommendations in real-time, democratizing a process that previously relied on costly consultants.
“While working as a retail pricing expert at a Big Four management consultancy, I noticed that retailers were plagued with inefficiencies when seeking pricing services to maximize margins and revenue. I knew there had to be a smarter and faster approach to pricing optimization efforts leveraging data and AI,” explains Alex, who now serves as the company’s CEO.
The team launched its flagship pricing platform in 2018, building on its initial competitive data solution. Its user-friendly dashboard provides retailers with direct access to real-time market data, rule-based automation and multi-purpose recommendation engines. The algorithms powering the platform use deep-learning techniques to generate optimal prices based on 20+ factors, such as inflation, seasonality, price elasticity, competitor behavior, and promotional impact. More recently, the team introduced its latest product, Competera X, a self-service version of the pricing tool for individual sellers of white-label products on digital marketplaces such as Amazon, Etsy and Shopify.
The company has more than 50 customers across 18 countries, including the US, UK, Germany, France and Italy, and boasts a perfect customer retention record. Its platform has optimized $60 billion in revenue for retailers in 20 sectors, averaging an uplift of 6% and 8% in gross margin and revenue, respectively, while saving millions of dollars per year in consulting fees.
“Our decision to back Competera comes down to the traction it’s getting among Fortune 500 companies, which we see as a strong indicator of its growth trajectory. We’re also impressed by its experienced leadership team and how they have guided the company through recent geopolitical and economic challenges while maintaining growth,” says Ulad Radkevitch, General Partner at Verras Capital.
Competera plans to use its funding from the latest round to enhance its AI capabilities, broaden its service offerings, and scale its operations, focusing on the US market, to meet demand from multinational retailers.
“We have effectively managed our spend, ensuring each retailer's readiness for AI pricing before investing resources to develop tailored POCs and scale across their business,” explains Alex. “Our singular focus on pricing maturity and delivering clearly defined business outcomes has allowed us over the years to enhance the platform and grow our customer base while maintaining a perfect retention rate. We are now poised for the next phase of organizational growth as we scale to serve our growing portfolio of global brands.”
The market for retail pricing solutions has seen a shift in recent years, with traditional consultancies like McKinsey and Deloitte facing competition from agile SaaS companies offering retailers scalable self-service solutions at a fraction of the cost. In 2021, Gartner named price optimization the number one use case for AI in retail, recognizing Competera as a representative vendor in the space.
"Machine learning and data science have been my personal and professional passion for over the last decade. I've seen hundreds of product companies with ML-based technology throughout my career. Competera X is one of a kind. The company has been in place for quite some time, and I see a uniquely built data-driven product with tremendous traction among enterprise retailers. The reason is apparent — it brings evident and measurable value. Based on their performance in the last few years, it was an easy and obvious decision to support Alex and his team and trust in their ability to execute further growth," commented investor Alex Medovoi.
The company claims its proprietary algorithms, which are trained using deep learning techniques, set itself apart from other pricing solution vendors. Unlike others on the market, Competera’s algorithms generate prices using an adaptive multilevel neural network that learns through each repricing cycle. To date, the company has deployed over 930 sub models to production trained on more than 10 billion transactions and 9 million products.
“If AI algorithms can continuously re-calculate billions of possible price combinations at scale using real-time data, it doesn’t make sense to rely on reactive, manual processes with limited computational capacity. The Competera Pricing Platform is a force multiplier, enabling businesses to set and maintain optimal prices faster, more efficiently and with greater precision than ever before — pricing becomes a means to stronger profitability and customer loyalty,” Alex adds.
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