About Crown

Founded in 2024 in Paris by Mykyta Voytenko, Crown is an innovative B2B e-procurement technology firm that streamlines the purchasing process through its online auction platform. This cutting-edge solution replaces traditional methods such as spreadsheets and emails, resulting in faster, more transparent, and efficient negotiations, enabling businesses to finalize deals in just 20 minutes.

According to Voytenko, typical negotiations yield savings of 3-4%, while an auction can achieve price reductions of up to 10%. This increase of 6% significantly impacts the key performance indicators (KPIs) of procurement teams, driving them to adopt Crown’s platform due to its demonstrated efficacy.

Industry Overview in Ukraine

The e-procurement landscape in Ukraine has been shaped by the pioneering public e-procurement system Prozorro, which effectively utilizes auction mechanisms to enhance transparency and efficiency in public procurement processes. This system has greatly influenced neighboring Eastern European nations, positioning them as leaders in the B2B online auction sphere.

Countries such as India, Turkey, and China have adopted auction models successfully, demonstrating that competitive bidding can yield significant savings and foster fairer procurement practices. However, in Western Europe and the United States, there remains a lack of established culture surrounding B2B auctions. Perceptions of auctions being aggressive or unethical have hindered their adoption in these regions.

Market conditions in Ukraine have been further affected by recent crises, including the COVID-19 pandemic, which has driven costs up by 20-50% compared to pre-pandemic levels. This environment highlights the necessity for more innovative procurement solutions that can adapt to rising prices and changing market conditions.

The Rationale Behind the Deal

The €2 million pre-seed funding led by HEARTFELT_ will enable Crown to scale its e-auction platform effectively, enhance its AI capabilities, and expand its team. The investment aims to bolster Crown’s growth trajectory, improve user experience, and ultimately drive its mission to revolutionize procurement practices in regions that have been slow to adopt such solutions.

By integrating technology into negotiation processes, Crown seeks to improve value delivery for procurement teams, marking a significant shift in how these teams operate and engage with suppliers.

Information about the Investor

HEARTFELT_ is a Berlin-based venture capital firm dedicated to supporting pre-seed startups founded in Europe or by European entrepreneurs worldwide. Through strategic investments and mentorship, HEARTFELT_ aims to help startups like Crown reimagine business processes and deliver lasting changes to their respective industries.

In addition to HEARTFELT_, reputable investors such as Kima Ventures, Backbone Ventures, and prominent angel investors, including Dr. Marcell Vollmer, ex-Coo of SAP Ariba, have also participated in this funding round, reinforcing the confidence in Crown’s vision and potential.

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Crown's approach to e-procurement through online auctions signifies a disruptive shift, particularly in regions where such models are not traditionally utilized. The combination of competitive pricing and AI-enhanced evaluations of quality and delivery terms presents a compelling value proposition for businesses looking to optimize their procurement processes.

Moreover, the significant financial backing from experienced investors indicates robust confidence in Crown’s growth potential and market positioning. Leveraging this investment for technological advancements and team growth could lead to substantial market penetration and leadership in the e-procurement space.

However, the challenge lies in overcoming the skepticism surrounding auction-based negotiations in Western markets. Crown’s emphasis on transparency and ethical practices in auctions could play a pivotal role in reshaping perceptions and fostering acceptance in these regions.

Overall, if Crown successfully navigates these hurdles and continues to innovate, it could emerge as a front-runner in the evolving procurement technology landscape, making this investment a potentially lucrative prospect for all stakeholders involved.

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