How personal care, home care and food brands can accelerate product development
Over 45,000 ingredients and several thousand service providers: that's what consumer goods manufacturers find on the Covalo platform (originally Chemberry). The Zurich-based start-up, which is part of the 5-HT network, has set itself the goal of becoming a one-stop shop for product development in the personal care, home care and food sectors. Why Consumer Good Brands should rely on Covalo for ingredient sourcing and product development is explained by CEO Timo von Bargen in an interview with 5-HT.
What is Covalo?
Covalo is a B2B platform that helps consumer good brands from formulation-driven industries such as personal care, home care or food to simplify their product development. We not only cover ingredient sourcing, but also the search for important service partners such as formulation houses, testing companies or packagers, as well as the organisation of the cooperation with these partners. Today, product development is still largely analogue. It is a complex process in which many different parties are involved and which involves many media breaks. We want to streamline this process by being available as a one-stop shop for product development in the areas of personal care, home care and food.
For whom is it worth using Covalo?
On the brand side, we are primarily targeting chemists who develop the formulations of the products, but also users from marketing who search the ingredients on our platform for product promises (such as "anti-aging"). Then there are the buyers from the procurement units who are interested in certifications, regulatory aspects, prices and availability. On the manufacturing side, we target both large chemical companies and smaller, specialised manufacturers of natural ingredients. In addition, other players such as packaging companies or contract manufacturers can also offer their services through Covalo.
How does the search for suitable ingredients work with Covalo?
Users can enter a search term directly via a free-text search and thus narrow down the more than 45,000 ingredients relatively quickly. In addition, they can set different filters depending on which parameters they want to optimise - for example, whether they are more interested in top performance or in the sustainable origin of the ingredients. This takes users to a shortlist where they can compare the individual ingredients in terms of up to 30 attributes. In the next step, we support requests for samples and various documents such as Material Safety Data Sheets, Technical Data Sheets or information brochures. Finally, price requests can also be made via our platform.
Why should consumer goods manufacturers rely on Covalo instead of one of the other platforms on the market?
Buyers will find on Covalo the most comprehensive catalogue of ingredients and formulations in the personal care and home care sectors, covering not only all relevant manufacturers but also more and more distributors who also serve smaller order quantities. Unlike other platforms, which often only list price and availability, our products list up to thirty attributes (with the corresponding documents). All of this is supported by search logic that is specific to personal care, home care and, in the future, increasingly food. For example, if a user enters the search term "anti-aging", he or she will also find products that advertise with terms such as "anti-wrinkle", "firming" or related claims. We are always expanding this search logic to help shoppers find the manufacturers that are relevant to them as quickly as possible with an intelligent search. Furthermore, unlike other platforms in the chemical industry, we think in terms of demand rather than supply: our platform is consistently geared towards what consumer goods manufacturers need to develop their products. With podcasts and blog posts, we create additional relevant content for our buyers that goes beyond the pure ingredient and services listing, thus giving them a reason to come back again and again.
Why is it worthwhile for manufacturers from the chemical industry to offer their products on Covalo?
One problem for manufacturers is that there are now many different platforms to take care of. That's why we have built web crawlers that scrape publicly available product data from manufacturers' sites and automatically update the product information on our platform - of course only after the manufacturers have verified and supplemented the data. This way, we significantly reduce the effort on the manufacturer's side.
What is the story behind the founding of Covalo?
In 2017, Clariant AG, the Swiss specialty chemicals company, launched a digitalisation initiative to develop concepts for digital business models based on customer conversations. I was part of this team, which conducted many interviews with large and small companies from the personal care and home care sectors. In the process, we learned that the search-and-discovery process is not yet well covered via existing solutions in the market. Many companies told us that they would be very interested in a solution that maps all relevant manufacturers, enables an intelligent search and offers a good user experience at the same time. As a result, we developed the Chemberry platform, originally as a corporate venture of Clariant. But because a platform should actually be independent, we spun Chemberry off from Clariant at the beginning of this year, renamed it Covalo and founded Covalo AG with headquarters in Zurich.
What are the next goals for Covalo?
We are currently in an investment round and are talking to well-connected business angels whose contacts cover either the supplier or the buyer side, but also to institutional venture capital funds. After we have completed the first investment round, we want to focus on hiring and grow our team to 20 to 25 employees by the end of the year. On the product side, we are working on expanding the functionalities in collaboration management so that users can, for example, create projects, invite project partners, write direct messages and exchange documents on the platform. The next big step is also to increasingly tackle the food sector in addition to the personal care and home care sectors.
What are the biggest challenges for Covalo?
The chemical industry is rather conservative, which is also reflected in the fact that the willingness to engage with new models is sometimes low. We are also confronted with classic B2B challenges such as the long sales cycles and the complex decision-making processes in large companies. Furthermore, I would wish that we as a European provider would be more appreciated for adhering to strict data protection rules compared to our competitors from the US - an aspect that should be given more attention when selecting tools.
How can the network of 5-HT support you on your way?
It is important for us to get to know the relevant players from the network, both on the manufacturer and customer side. For our current financing round, we are also looking forward to getting in touch with investors who have been in the chemical or consumer goods industry for a long time, have a good network in this area and are interested in talking to us and possibly investing in Covalo.
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