Startup raises 27 million with AI that threatens process consulting work
Celonis, a Munich-based startup that uses artificial intelligence to create software that, according to them, can replace the duties of management consultants, has raises $27.5 million in venture funding.
Celonis was founded in 2011 by three former students of the Technical University of Munich, Alexander Rinke, Bastian Nominacher, and Martin Klenk. The company, which is headquartered in Munich, provides clients globally with a suite of AI driven Process Mining software, as well as techniques for Automated Business Process Discovery. The software packages allow its clients to unconceal the complete chain of digital business process activities, thereby allowing companies to isolate inefficiencies – a boon to the bottom line as well as client satisfaction. According to the firm, operational efficiency benefits can rack up to between 20% - 30%.
The software is, according to Rinke, a competitor to the traditional management consultant, some of whose offerings – often at a high, human, bill rate – are similar. The firm’s offering has drawn attention from a range of high profile companies, including Siemens and Bayer. Ironically, given that it automates part of the management consultancy process, two of the Big Four, Deloitte and KPMG, are company clients.
The firm has seen demand for its services grow explosively; revenue growing 3,951% over the last four years. Its client base, across 25 countries, has increased to more than 200, and, in addition, Celonis signed a resellers deal with SAP last year. The success of the firm has seen interest from the investment community, with the company recently announcing it has received $27.5 million in Series A backing from investors led by Accel and 83North. The investment provides the company with funds needed to “boost go-to-market operations, improve technology, and further global expansion.”
“With Accel and 83North, we’re honoured to have two partners on our side who are experienced with tech companies and the challenges of scaling globally,” says co-founder and CEO Rinke. “Not only will this funding give us more flexibility to plan and execute our growth strategy, but both investors can support us with valuable practical experience, infrastructure and strategically-important contacts.”
Harry Nelis, Partner at Accel, says: “We are excited to partner with the Celonis team to help them achieve their mission of taking the Process Mining category worldwide. Alex, Bastian and Martin have built a high-growth and profitable company straight out of university, and already serve a long list of large multinational customers, all without raising any external funding to date. We look forward to helping them reach their next stage of growth, particularly in the US market.”
Consulting trend
While many analysts believe process mining software like that of Celonis threatens the role of management consultants, consulting firms themselves are not standing still. They too are bolstering their automation expertise. Large strategy houses are investing heavily in digital practices, and embedding solutions into their portfolio. McKinsey for instance, has McKinsey Solutions, while also BCG and Bain have added significant automation capabilities to their ranks in recent years.
