BluePallet Raises $ 5 Million to Expand Chemical Industry Market Globally – TechCrunch
BluePalette, an online marketplace connecting manufacturers with the chemical industry, today announced that it has raised $ 5 million in a funding round led by Vinmar Ventures, a subsidiary of petrochemicals maker Vinmar International.
The startup also announced today that it has become the first industrial commerce platform to âofficiallyâ operate on Alibaba.com. This means that BluePallet’s network of chemical manufacturers and distributors will be exposed to millions of commercial buyers around the world sourcing from the e-commerce site.
The funding brings BluePallet’s total raised to $ 10 million and includes participation from chemical industry veterans Terry Hill, Barentz CEO for North America; Mathew Brainerd, CEO of Brainerd Chemical Co.; and Bruce Schechinger, past president of the National Association of Chemical Distributors.
BluePallet was founded in 2020 by the merger of the then three-year-old EchoSystem chemical marketplace and Velloci, a fintech company. BluePallet’s goal is to apply its âmarket network modelâ to modernize commerce and transactions for a massive industry that has historically lagged behind in technology. (I should know, I covered the petrochemical industry in the late 1990s).
The chemical industry is not seen as sexy, but it supports many other sectors that we all depend on, such as the manufacturing of consumer goods, pharmaceuticals, and agriculture.
BluePallet says its e-commerce model provides industrial buyers and sellers with access to a larger market while “strictly adhering” to the requirements of regulatory compliance and responsible distribution. It claims to be able to give buyers and sellers more control over their supply chain.
The BluePallet site offers three products: TradeHub – a permission-based marketplace where users can find and list products with networking tools; TradePass – a âproprietaryâ trade verification technology that aims to ensure ânetwork integrityâ by examining thousands of operational, business and financial risk data points âon an ongoing basisâ; and TradeCart, a proprietary payment system that integrates payment processing, authentication and logistics.
Along with the financing, BluePallet is also announcing the relocation of its headquarters from Chicago to Austin, Texas. The reasoning behind this is the closer proximity to Houston, which is home to a robust chemical industry, and being able to take advantage of Austin’s âvibrant tech and entrepreneurial sceneâ.
BluePallet CEO Scott Barrows, who founded EchoSystems, said the increase represents validation of his offer. (Barrows previously co-founded the Epic Seats and ZeroHero ticketing platforms, which are used today by LiveNation and TicketMaster). He co-founded BluePallet with Austin Britts, Kevin Fuller and Brian Perrott.
âAs we continue to grow, we are looking east and aiming to quickly establish a regional presence in Asia,â he added.
Asia-Pacific is the largest region in the global chemicals market, accounting for 49% of the $ 3.34 trillion industry in 2020. North America is the second largest region, accounting for 17% of the market. Because BluePallet is in partnership with the NACD with access to its 750,000 member companies, Barrows believes the startup has significant room for growth.
âWe are really challenging and pushing the boundaries of what can be done in these B2B transactions,â he told TechCrunch.
As the company works on building its network marketing platform, it has attempted to partner with existing fintech companies.
âWe found out that even the biggest ones had a maximum of $ 100,000 per trade, or they didn’t want to do business with the chemical industry, which is crazy,â Barrows told TechCrunch. “So we decided that we were going to solve this problem for the $ 5,000 billion chemical industry and build this technology ourselves.”
In what Barrows sees as a strong differentiator, he says BluePallet is capable of handling transactions of up to $ 1 billion.
âNow that we can move money this way, we are entering more and more international markets,â he said. “We think that’s the key, and it’s missing in a lot of these new offerings from a lot of startups.”
He also points out that BluePallet is more than a âmatchmakerâ.
âMost of the other sites are literally just matchmakers and that’s it,â he said. âThey don’t have the ability to complete a transaction and instead have the parties complete the transaction offline. So this is going to really change and improve the way people in the industry trade. “