A startup called Pavus AI said today it has raised $5.2 million in funding to help organizations get better access to their procurement data, so they can leverage it to optimize spending and reduce their cost base.

The funding comes via seed and preseed rounds led by Sentinel Global, which was the only investor named.

Pavus AI wants to use artificial intelligence to unlock procurement data, which is critical for virtually any business that regularly needs to procure supplies. This information, which is usually buried in spreadsheets, emails, files and disconnected tools, can be crucial for businesses because it provides insights that can be helpful in negotiations with suppliers and enhance decision-making. By analyzing this data, companies can identify opportunities for improving margins, manage risks more effectively and better align their procurement strategies with their business goals.

Procurement is often a big part of businesses’ operations, and even an improvement of just 1% to 2% lower costs can result in millions of dollars in savings, Pavus AI says.

The challenge is being able to unearth the insights buried in all of this data, and that’s where Pavus AI believes it can make a difference. It has created what is essentially a “digital brain” for procurement, with an AI-enabled system that connects internal and external market data, organizes it and makes it simple for teams to access. Procurement teams can then leverage it to challenge suppliers with more confidence, hammer out better deals and find better ways to work with finance and operations, the startup said.

Pavus AI founder and Chief Executive Khalil Birouaine said he’s tackling the procurement data challenge because he has personal experience of the pain involved in spending weeks just trying to gather up all of the critical information and make sense of it all. “With Pavus AI, we are finally making it simple to turn that data into smarter decisions and bigger results, and the impact is huge,” he insisted.

The startup’s platform applies AI to procurement in a logical way, integrating with enterprise resource planning tools and email platforms to provide greater visibility into a company’s spending. After analyzing this data, it will automatically identify opportunities for continuous cost savings across both direct and indirect spending. As part of this, it will monitor prices from multiple suppliers in real time to ensure businesses are never overpaying for critical supplies.

Pavus AI’s platform can also help to identify new suppliers that businesses may have been unaware of, and then apply AI-driven multi-criteria filtering to ensure they’re capable of matching their demands. By combining AI-driven benchmarks with data on market trends, it provides the rich insights procurement teams need to negotiate with multiple suppliers and win better deals.

The startup says it’s already working with several large enterprises, mid-sized manufacturers and private equity operating teams, helping them maximize margin improvements worth millions of dollars.

Robert Tevelson, who formerly led Boston Consulting Group Inc.’s global procurement business and now acts as a senior adviser to Pavus AI, said he has seen many tools attempt to unlock the value hidden in procurement data, but all of them have failed. “Pavus AI is the first platform that truly combines deep procurement know-how with AI to make data work in a way we have never seen before,” he said.

Pavus AI intends to introduce new services to help its customers capture even more value from their procurement data and expand its enterprise partnerships as it looks to enable more intelligent sourcing for every business.

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