A St. Petersburg tech startup that was one of several to move to the region in the last year has closed a $750,000 pre-seed round.
Procoto, which moved from Atlanta to St. Petersburg in spring 2021, announced the close on Wednesday.
“For 15 years of my life, I’ve wanted to build a software company, and for the last five, the goal has been to build this company,” said Michael Otis, the company’s CEO and founder. “Having the funding will enable us to build the team and reach the lofty expectations we have.”
TampaBay.Ventures led the round with a “high” six-figure investment. The round included participation from Silicon Valley-based accelerator group Y Combinator and unnamed local angel investors.
The company offers procurement software for small and medium-sized businesses at a lower price point than enterprise solutions.
“We did research on procurement software ... and found there was a huge gap,” Andreas Calabrese, general partner at TampaBay.Ventures said in a previous interview. “Anytime you’re replacing a product for small and medium-sized business, and replacing spreadsheets and manual work, it is a good sign.”
Procoto will primarily use the funding to build the team, which currently has three full-time employees. Otis hopes to hit roughly double that by the end of the year, with 10 to 12 employees by 2024.
With the new employees will come a need for more funding, Otis said. He estimates closing a bridge or seed round by early 2023, with a Series A to follow in 2024.
“The goal is to raise what we need and not over-raise,” he said.
But the latest funding is also, in part, a way to further cement Procoto as a St. Petersburg company.
“From the day I moved here, it was very much, ‘We want to be a St. Pete company,’” Otis said, “and not one that happens to be in St. Pete.”
He plans to commit to the region by offering free software, vendor and data cleanup services for one year to any Tampa Bay organization.
“There’s such a need for younger, simpler, more fun ways to do procurement that are more adaptable for growing small businesses,” Otis said. “We plan to be the company that’s going to change that and make procurement more accessible for everyone.”
