A new Seattle-based startup called Peasy has raised a $2 million pre-seed round to challenge conventional approaches for independent consumer goods brands by offering its core software completely free, betting that a novel business model can disrupt how small food, beverage, and beauty companies manage their operations.
The company, founded this year by former Shelf Engine executives Ryan Conti and Bryan Mitchiner, has built an operating system that centralises inventory and operations for independent consumer packaged goods companies that traditionally have relied on spreadsheets for managing their businesses.
The company indicated it is helping brands reduce manual data entry by approximately 60%. The software can also forecast low stock levels, new manufacturing requirements, and changes in demand, providing predictive capabilities that spreadsheets cannot deliver.
Conti and Mitchiner met at Shelf Engine, the Seattle startup that helped grocers optimise ordering and was acquired earlier this year. Mitchiner also previously founded and sold a CPG brand, Mustard & Co., giving him firsthand experience with the operational challenges facing the companies Peasy aims to serve.
Peasy’s most unusual strategic element is its pricing structure: the core inventory management software is completely free.
The decision to forgo a traditional subscription fee emerged from a straightforward realisation, as the company noted in a recent post: “We’re competing with spreadsheets… and spreadsheets are free.”
Peasy plans to monetise by charging standard payment processing fees on transactions that run through the system, such as payments to suppliers and invoices to customers. This creates a “harmonic business model,” according to Aviel Ginzburg, general partner at Founders’ Co-op, which co-led the round with Bread and Butter Ventures.
“It’s not a business built around software that you pay for. It’s mutually aligned outcomes where both the customer and the vendor share in the upside as they scale,” Ginzburg stated.
Peasy’s unique pricing model comes amidst growing discussion amongst technology leaders about how companies will pay for software in the age of AI. Some argue that AI-native businesses are shifting away from traditional seat-based subscription fees toward consumption- or outcome-based pricing structures.
Conti described the company’s fundraising journey in a LinkedIn post: “Free is a hell of a wedge.”
Peasy is working with eight design partners, including Seattle ice cream company Frankie & Jo’s, and has another 30 brands on its waitlist.
Founders’ Co-op previously invested in Row Zero, another Seattle startup rethinking spreadsheets. Ginzburg indicated the firm is “obsessed with businesses that compete with spreadsheets.”
The $2 million pre-seed funding round for Peasy reflects investor confidence in the company’s contrarian approach to software monetisation, betting that eliminating upfront costs will drive rapid adoption amongst price-sensitive independent CPG brands whilst creating a sustainable revenue model through transaction processing fees that scale with customer success.
The founding team’s background at Shelf Engine provides relevant experience in building software for the food and beverage supply chain. Shelf Engine focused on helping grocers optimise ordering through predictive algorithms that reduced food waste whilst ensuring product availability, demonstrating the founders’ understanding of inventory management challenges and their ability to build technology addressing operational inefficiencies in the sector.
Mitchiner’s additional experience founding and selling Mustard & Co. provides crucial perspective on the customer needs Peasy aims to address. Running an independent CPG brand involves juggling manufacturing schedules, ingredient sourcing, inventory tracking, order fulfilment, cash flow management, and countless other operational details typically managed through spreadsheets, email, and manual processes because dedicated software solutions have been too expensive or complex for small brands to justify.
