San Francisco startup Fragment has launched with $56M to automate the purchasing problems that large manufacturers, distributors and energy companies still fix by hand, from changed orders to invoices that do not match. The total covers a Series A led by 8VC and a seed round co-led by General Catalyst and A*, and Fragment has not said how the money splits between them.
Jack Moshkovich, a partner at 8VC, said Fragment had aimed at big, complex companies from the start. “Most software companies earn their way into the enterprise over time. Fragment started there,” he said.
Angel investors in the company include former Sequoia Capital managing partner Roelof Botha, Palo Alto Networks chief executive Nikesh Arora, former Amazon consumer business chief Jeff Wilke, Opendoor co-founder Eric Wu and Dennis Cinelli.
The money will go into further work on the company’s software, expansion across the wider purchasing process and deployments with more of the world’s largest enterprises.
Where Purchasing Breaks Down
Fragment works in direct procurement, the buying of raw materials and components that go into a company’s own products. At a large manufacturer, purchase orders and invoices pass between buyers, suppliers and finance teams, and every change along the way can create extra work.
A supplier amends a purchase order, an invoice does not match the order, a payment is put on hold or a dispute needs settling. Supply shortages and tariff changes can add further revisions to purchasing plans. Fragment calls these cases exceptions, and staff often resolve them by checking several systems and spreadsheets by hand.
“Procurement teams have spent too much of their time chasing discrepancies across systems,” said Pranav Mulgund, Fragment’s co-founder and chief executive.
Agents That Finish The Job
At the centre of Fragment’s product is its Autonomous Context Engine (ACE), software that connects information spread across a company’s systems and records its own policies, supplier relationships and working knowledge. Fragment says ACE works with data where it already sits, in enterprise resource planning (ERP) systems, factory software, spreadsheets and supplier portals, so customers do not have to move data or run a long integration project.
Using that context, Fragment’s agents investigate an exception, choose a response and carry out an approved fix from start to finish, rather than only flagging the problem or suggesting a next step. Customers can then extend the automation to more workflows as the system learns.
On its website, Fragment says exceptions and rework often fall by around 50% within the first few weeks, and that customers reach a point where more than 90% of exceptions are processed without human involvement. The company has not published independent results. Pricing is based on the amount of work the agents complete, not on the number of users.
Early Customers And Founders
Fragment names two customers. Graybar, a St. Louis, Missouri, distributor of electrical, communications and data networking products, is one. The other is CNX, a natural gas producer based near Pittsburgh, Pennsylvania.
Paul Ferguson, vice-president of global finance shared services at Graybar, said the Fragment team “took the time to understand our business, listen to our teams” and combined that knowledge with its own AI expertise.
Mulgund grew up in a manufacturing family and was originally a physics researcher. He helped start two supply chain companies and later led part of Zoom’s product organisation, working on products for frontline workers in manufacturing, healthcare and education. His co-founder, Naveen, has worked on data and workflow problems since his days in generative AI research and later scaled an applied AI platform.
Procurement First
Fragment arrives with backing from 8VC, General Catalyst and A*, and with software meant to take routine purchasing problems off people’s desks. The plan starts with direct procurement at large physical goods companies, where shortages and tariff changes can upend purchasing plans, before moving across the wider buying process.
Beyond procurement, the company says it wants to become “a trusted foundation for autonomous execution across the world’s largest enterprises”, with Graybar and CNX as its first named customers.
