Magentic, a London-based startup, has secured $18M in a Series A funding round led by Felicis, with participation from existing investors Sequoia Capital and The Westly Group. This investment comes just a year after the company's launch in July 2025, when it raised a $5.5M seed round led by Sequoia Capital.
Magentic's innovative approach involves building AI agents, dubbed Mages, which operate inside a manufacturer's software, utilizing Microsoft Teams and email to communicate with human colleagues. These multi-agent systems can handle every aspect of procurement, including supplier selection, contract negotiation, order placement, and invoice clearing. However, human approval is still required for critical decisions.
The company's technology is designed to tackle both indirect spending and direct spending on raw materials used in products, which is often the most challenging part of the job. Many of Magentic's customers have billions of data rows and outdated systems, with some still relying on Excel. According to the company, one customer processes over a million orders annually through its agents, while another has already saved $4M. Typical savings among its customer base, which includes Global 500 companies and three of the world's ten largest beverage producers, range from 2% to 5%, with a 60% improvement in data quality.
Robin Van Aeken, CEO and co-founder of Magentic, emphasizes the significance of building intelligence into every decision-making process, particularly during a time of trade disruption and geopolitical challenges. Van Aeken, a former McKinsey consultant, pitches the business as a response to the current spending boom.
Felicis partner Feyza Haskaraman highlights the difficulty of automating supply chains, which are often the least glamorous yet most consequential part of the economy. She notes that Magentic's approach is unique, as the firm has not seen anyone else build autonomous AI workers for the physical economy. To address concerns about AI agents operating within critical systems, Magentic provides zero-data-retention agreements with leading AI model providers and supports isolated installations in any data region.
Odhran O'Donoghue, CTO and co-founder of Magentic, explains that bringing frontier AI to the physical world requires pushing beyond AI systems with limited context windows. The company is building AI that can diagnose problems, plan fixes, take action, and see work through across vast amounts of multimodal data. O'Donoghue holds a PhD in machine learning from Oxford and previously worked on AI projects at OpenAI.
With offices in London and New York, Magentic anticipates that its human resources teams will grow as individual output increases. The company's innovative approach to supply chain management is poised to revolutionize the industry, and its recent funding round will likely accelerate its growth and development.
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