Highline Beta spinout wants to tackle a $1.77-trillion problem faced by consumer brands.
Toronto-based artificial intelligence startup Moselle is gearing up to add new functionalities to its inventory management platform after securing $2.1 million CAD in seed financing.
The all-equity seed round, which closed in August, was co-led by MaRS Investment Accelerator Fund and Montréal-based early-stage venture capital firm AQC Capital, with participation from consumer specialist investment and innovation advisory firm True, Rebellion Ventures, Highline Beta, Top Knot Ventures, and Singh Capital. The round brings the startup’s total funding to $2.8 million CAD.
“We felt like [this problem] would have been solved in the Shopify platform or by some of these new-age commerce platforms. But it’s not.”
Lakhveer Jajj, Moselle
Moselle is focused on solving the trillion-dollar issue of inventory distortion, which refers to the combined costs associated with having too much inventory or not enough. Last year, IHL Group estimated this would cost brands a cumulative $1.77 trillion in 2023.
“There are tools to support inventory planning, but there’s an independent planner ops person within a company doing this, and they’re ripping out their hair,” Moselle CEO and founder Lakhveer Jajj told BetaKit in an interview.
“Sales and marketing are saying one thing, and founders are saying another,” he added. “What we’re trying to do is really automate that role and build a platform where it can do that just-in-time inventory for merchants.”
Moselle has developed a platform to help small and medium-sized brands better plan their procurement from suppliers and reduce the costly impact of inventory imbalances. The platform uses AI to automate supply chain processes, predict demand, and optimize operations by analyzing data from various sources. Features include supplier management, ordering, tracking, inventory, and demand planning.
Moselle spun out of venture studio Highline Beta after several months of research and validation work, which began in 2018 when Jajj joined Highline Beta as senior technical director, helping brands like now-acquired Relay Platform on the technical side. Prior to Highline Beta, he worked as an engineering director at Toronto-based care services marketplace CareGuide.
Jajj knows the problem Moselle is trying to solve first-hand. During his college years, Jajj helped manage the supply chain and inventory for his parents’ Indian grocery business, which they had launched themselves. “I really felt the pain point of buying too much product or buying too little,” Jajj said.
“We felt like [this problem] would have been solved in the Shopify platform or by some of these new-age commerce platforms,” he added. “But it’s not—brands are still struggling with this, and it can make or break them.”
The original concept for Moselle was focused on inventory finance, but Jajj said he later chose to pursue the idea of solving financial challenges for trade businesses, leading to the creation of Moselle. By 2020, Moselle had officially spun out as its own independent company with support from Highline Beta and its corporate partners.
Moselle claims that on average, its platform saves 15 hours per week on inventory management, improves forecasting accuracy by 80 percent, and reduces stockouts (which occur when inventory is exhausted) by 16 percent on average.
Among its customers is premium dinnerware brand Fable, which, according to a case study on Moselle’s website, saves $120,000 annually by streamlining demand planning with Moselle’s platform.
“We see every day the challenges fast-growing consumer brands face in managing their inventory, and getting it wrong can lead to significant cash flow issues and poor customer experience,” Mike Martin, director of investment at True, said in a statement. “That’s why we’re excited to partner with Moselle on their mission to help all brands leverage the power of AI to solve this problem.”
Moselle claims that merchants have already purchased over $50 million in inventory using its automation suite. With the new funding, the startup plans to further enhance its AI-powered inventory forecasting, production planning, and purchasing tools. Jajj said the platform currently serves approximately 40 merchants, and this funding will help Moselle bring 100 brands onto the platform.
In the near future, Moselle expects to introduce new AI features to automate more of the manual work merchants face, along with new collaboration and demand forecasting capabilities. The startup also aims to soon release tools to help brands optimize cash flow and secure financing.
Jajj said currently, the startup’s big focus is on creating an operational platform that allows brands to upload their supply chain data and then digitize and optimize it. “We haven’t really seen that play out for a lot of merchants at all,” he added. “This space hasn’t changed in forever.”
Feature image courtesy Moselle.
