The chemicals industry is responsible for converting raw materials into primary products essential to all other sectors, from cars and cosmetics to pharmaceuticals. However, it remains largely out of reach of consumers. Ali Amin Javaheri says it is his entire life. “It is a fascinating market that most people spend not a minute of every day thinking about,” he told Forbes. “It’s one market that lives in shadows and doesn’t directly touch us. But most consumers and people don’t realize that chemicals can create every physical good. Amin-Javaheri was the child of a DuPont Chemist and grew up there before he entered the market. The market was huge, with an estimated $3.9 trillion revenue in 2019. However, the way buyers interact with it hasn’t changed that much since his dad’s time. Amin-Javaheri is determined to make this a better place. He states, “It is extremely fragmented. The recent buying experience in the market is as inefficient and as inefficient as one can imagine.”
Amin-Javaher is well aware of the difficulties involved in bringing a legacy industry to the digital age. He was part of a ChemPoint team that tried to do what he created now but ended up more as a middleman distribution site. This experience allowed him to create Knowde in 2017, a modern B2B marketplace that will enable buyers and sellers to connect in the chemical industry directly. With his cofounder Wojciech Krupa, the startup has enrolled thousands of potential suppliers since its launch. Due to growing demand, the startup raised new capital.
Coatue led a Series B round of $72 million for the San Francisco-based company. Other new investors, Sound Ventures and Mantis, also participated in the round and existing investors such Sequoia. Shaun Maguire is a Sequoia partner who led the firm’s Series A round in May 2020. He tells Forbes he was initially excited about the company’s ability to tackle a fragmented niche and large enough for a market model. He claims he was impressed by the company’s progress and returned to invest in Series B. Maguire said that Ali just had an evident vision of what he wanted to do and that it got him very excited. “They did everything they said they would, and the number-one thing that the company has focused on is indexing Knowde users and getting them as many of their users as possible.
Knowde Amin Javaheri said that getting information about sellers online was the first step. This is because the entire industry is still stuck in PDFs. Buyers often go back and forth with sellers for several months to get information about their products, let alone request samples or make purchases. “What we say internally, is “How can you get it down 12 days?” We need to have every product on the platform and allow customers to use basic search filters so that [customers] can go from 100,000 [sellers] [to the right seven] quickly.” After this was established, the company added more features, such as making transactions online and marketing tools for suppliers.
Knowde has already brought in approximately 20% of the chemical suppliers to the platform. So far, the focus has been mainly on Europe and North America. The platform is gaining strong traction even though it was initially intended to be used by smaller buyers to understand the market better. Amin-Javaheri stated that the startup would use this capital to expand its geographic reach and continue adding suppliers. He says, “The only way innovation can happen is through chemistry.” “We are proud to say that we built Google for chemistry.