Toolio Secures $8M Funding to Optimize Retail Inventory

Inventory Optimization Platform, Toolio, Secures $8 Million in Series A Funding

Experiencing stockouts can lead to lost sales opportunities and potential delays in replenishing popular merchandise.

Toolio, a New York-based company, has developed a cloud-based software solution focused on merchandising and inventory planning.

Series A Funding Details

The company announced an $8 million Series A funding round on Thursday.

Jump Capital spearheaded the investment, with participation from Rho Capital’s Ignition Fund, alongside existing investors including Founder Collective, Notation Capital, and Max Ventures.

This latest funding brings Toolio’s total raised capital to $10.3 million since its inception in 2019.

Founding and Origins

Toolio was co-founded by Eytan Daniyalzade and Berk Atikoglu, both former employees of Walmart.

Prior to Toolio, the founders created the fashion application Stylr, which was acquired by Walmart in 2014 after achieving significant user growth.

During their time at Walmart, Daniyalzade and Atikoglu identified shortcomings in supply chain and merchandising processes, specifically regarding product selection and store allocation.

Addressing a Market Gap

“Even within a large organization like Walmart, processes were heavily reliant on spreadsheets,” explained Daniyalzade in an interview with TechCrunch.

“There was a clear desire to transition to a data-driven approach, and we recognized a gap in the market.

This realization prompted us to leave Walmart in 2019 and create a more accessible planning platform.”

Software Capabilities

The Toolio platform integrates seamlessly with existing commerce technology stacks.

It automates key workflows and delivers forecasting analytics, enabling retailers to respond to real-time demand fluctuations.

This results in reduced stockouts, improved profit margins, and accelerated inventory turnover.

Growth and Current Clients

Initially focused on enterprise-level clients, Toolio identified a growing need for cloud-based tools within the mid-market segment last year.

Consequently, the company experienced a 20% month-over-month increase in both revenue and customer acquisition.

Currently, Toolio serves retailers such as Chubbies, Mack Weldon, and Rothy’s, and has overseen more than $1 billion in retail inventory.

Future Plans

The Series A funding will be used to expand Toolio’s reach into new retail verticals.

It will also facilitate team growth and the development of new product modules, including supply chain and materials resource planning features.

Investor Perspective

Yelena Shkolnik, a partner at Jump Capital, stated that she first learned about Toolio through recommendations from retail industry advisors.

These advisors highlighted Toolio’s ability to address critical inventory challenges, including optimizing purchasing decisions.

Impact of the Pandemic

Shkolnik noted that the global pandemic exposed the extent of retailers’ reliance on supply chains originating in China.

This disruption underscored the need for more resilient and analytical inventory management solutions.

Toolio’s innovative approach to prioritizing inventory proved particularly valuable during this period.

Unique Expertise

“Their prior experience with Stylr demonstrates a strong understanding of the retail landscape,” Shkolnik added.

“Inventory management was the last major component of the retail technology stack to transition to the cloud, and Toolio has successfully enabled this shift.”

The Evolution of Retail Technology

Daniyalzade observes that while the front end of retail has seen significant advancements, particularly with platforms like Shopify, the back end has lagged behind.

He attributes this to the perception that back-end operations are less “glamorous” and the historical failure of previous solutions.