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Marrakech seeks third round of funding
Tuesday, June 19 2001
by Kevin O' Brady


Irish on-line procurement company, Marrakech hopes to raise at least USD25
million in a third round of funding.

The exact amount required would depend on the valuation given to the company,
which has yet to be determined, according to company chief executive officer
Kelly Murphy. 



It has been speculated that the company would raise around USD40 in its new
rounding of funding, but Kelly explained that he could not comment that level of
funding. He said that that the company expected to raise "at least" USD25
million, but any figure above that could not be confirmed.    





However, it is likely that USD25 million will be sufficient for the company's
present plans, according to Murphy. This amount would be the minimum required, he
added.







Meanwhile, the company was also reported to be expecting revenues of USD2 million
for 2001 and USD25 million for 2002. However, those figures were on the low side,
said Murphy.



Although only founded in 1998, Marrakech already counts Tesco among its clients.



"We approached them with an understanding of who they are," said Murphy. "They
are an appropriate customer for us because they are close to revenues of USD3
billion per year. They are also well-known in logistics and supply chain
management."



"We approached them to offer them advanced solutions," he explained. "In
fact, we were introduced to them after they had chosen from a shortlist of four
other companies."



"We have an ongoing service type of relationship with them," he added. "This
is very similar to our relationship with companies like Smurfit."



"We have had Tesco on board about six months now," he said.



The success of Marrakech so far has been achieved despite the global decline in
the overall IT sector.



"We are focused on proving greater value for our customers," explained Murphy.
"We have changed the way in which software is delivered, and we always offer
very low capital cost."



Furthermore, through alliances with AIB and Citibank, Marrakech has largely
avoided the banking problems experienced by companies such as Marketplace.ie.



Marketplace.ie found that banks were reluctant to debit or credit accounts in
respect of on-line transactions even though the company was able to show that it
could attract and meet on-line orders.



"We have a co-marketing and co-branding arrangement with AIB and Citibank,"
said Murphy. "We work with them to service their customers. This is the nature
of what we do," he added. "Our core businesses are very complementary to each
other."



In July 1999, Marrakech secured USD6 million in its first round of funding. In
2000, it secured USD24 million in a second round of financing.



In May 2001, Marrakech was chosen by the Jefferson Smurfit Group as Smurfit's
global e-procurement solution for indirect expenditure.



Marrakech employs 230 people around the world, including about 180 people in its
research and development operation in Dublin.



Marrakech is at www.marrakech.ie