“We’ve made more money than we ever dreamed of”: RELEX Solutions’s Johanna Småros
Dec 18, 2023
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Johanna Småros, co-founder of RELEX Solutions, discusses the company's journey from academia to commercialization and how they are helping to reduce waste in the supply chain. They explore the importance of supply chain efficiency, the satisfaction gained from addressing challenges, fundraising plans, and the relationship between their commercial and nonprofit solutions. The podcast also touches on staying motivated after 20 years, the role of AI in RELEX Solutions, and the challenges and potential improvements in the industry.
RELEX Solutions aims to optimize supply chains and reduce waste, particularly in the food industry, by providing supply chain and retail planning software.
Despite initial bootstrapping, RELEX Solutions required external financing to support its expansion to the US market and prioritize investors with compatible allocation strategies and positive references from portfolio companies.
Deep dives
Relik Solutions: Revolutionizing Supply Chain and Retail Planning
Relik Solutions is a Finnish tech company valued at over a billion dollars that focuses on supply chain and retail planning software. Founded in 2005 by three co-founders, the company aims to optimize supply chains and reduce waste, particularly in the food industry. By offering solutions for demand planning, commercial planning, supply chain planning, and operations planning, Relik Solutions helps its clients maximize customer satisfaction while minimizing costs. Their impact can be measured through increased on-shelf availability, reduced inventory and waste, and improved sustainability, estimated at removing over 200 million kilos of waste annually. The company's success has led to international expansion, starting with neighboring countries and gradually entering the US and other regions. Despite growth, Relik Solutions remains focused on providing measurable results to clients and creating a fair and sustainable business environment.
The Role of Bootstrapping, External Funding, and Choosing the Right Investors
Relik Solutions took a bootstrapping approach during its early years, relying on revenue from clients rather than seeking seed funding. The founders strategically focused on building a profitable and scalable business while gaining insights from clients. However, when the company decided to expand to the US market in 2015, external financing became necessary to support sales and marketing efforts and replicate their success. When selecting investors, Relik Solutions prioritized those with a compatible allocation strategy, a track record of long-term investment, and positive references from portfolio companies. While the company remains open to future capital raises, the current focus is on market expansion, product development, and impactful investments.
Creating a Foundation for a Better Future
The founders of Relik Solutions established the Relik Foundation for a Better Future, a separate non-profit organization aimed at supporting biodiversity, climate change mitigation, human rights, and global equality. Recognizing the disproportional financial gains from their successful business, the founders decided to take action and invest in a better future by pooling their resources and making substantial donations. The foundation operates independently from Relik Solutions but retains a shared name as a tribute to the contributions of employees. With expert guidance and sizable donations, the foundation seeks to drive positive change in various fields beyond what commercial solutions or governmental initiatives may provide.
Motivation, Company Growth, and Evolving with the Business
Motivation for the founders of Relik Solutions comes from delivering tangible results to clients, including improved supply chain efficiency and sustainability. The satisfaction of seeing measurable impacts, such as increased availability, reduced waste, and optimized inventory, remains highly rewarding. The opportunity and responsibility to create a business environment characterized by fairness, respect, and taking accountability for the planet's impact are also strong motivations. As the company has grown, founders have adapted to changing roles and responsibilities, ensuring they are aligned with their areas of expertise and passion. Staying open to change and understanding personal strengths and areas of joy are crucial aspects of personal and business growth.
What do Lidl, Auchan, Sephora and Flink have in common? They’re all customers of RELEX Solutions, one of Finland’s four private tech companies.
RELEX makes supply-chain and retail-planning software — which might sound boring, but it's extremely important when you consider how much inventory, especially food, is wasted due to poor planning.
Sifted sat down with cofounder Johanna Småros to talk about the company’s decades-long journey from academia to commercialisation, just how many millions of kilos of waste annually the company is helping to avoid and why RELEX’s engineers are tired of hearing about AI.
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