(TNS) — San Diego software startup Capture2, which aims to become like Salesforce for government contractors, has raised $4 million in a first round of funding led by Peter Thiel’s Mithril Capital Management.
Founded in 2015, Capture2 has developed software to make it easier for businesses, particularly small and midsize companies, to penetrate the government contracting market – where long sales cycles, complicated procedures and entrenched incumbents can create barriers.
“In this market there is a significant information disadvantage that the non-incumbent small business often faces,” said Chief Executive Douglas Gourlay. “Twenty-five percent of all procurement dollars go to 10 companies, 50 percent goes to 100 companies.”
Capture2 spent more than two years building a research, subcontracting and proposal management system for government contracting. It helps clients identify government contracts that fit their expertise.
Capture2 lets clients search for contracts based on topics, keywords or other criteria. It can display contracts coming up for renewal, agency preferences and product/service offerings.
A new feature, called “Sonar Teammate Matching” pinpoints potential subcontracting jobs that clients might pursue from the prime contract winner.
For example, Capture2 delivered a search for a client near Atlanta filtered on Oracle expertise, best value (instead of lowest price criteria), small-business set-aside language and security clearances that the client had, said Gourlay.
“It is changing the way government contractors do business—no more scrolling through hundreds of procurements, no need to rely on an extensive list of ‘who you know,’” he said.
The company was founded by former U.S. Marine Christopher Pohle, who previously worked as chief technology officer for TechFlow, a government and commercial contractor. Pohle is chief product officer of Capture2.
About nine months ago, Gourlay took over as CEO after serving on the company’s board of advisers. He is former Arista Networks and Cisco Systems executive who spent eight years in the U.S. Army.
The company has more than 50 subscribers, ranging from small businesses seeking their first government contracts to Fortune 100 companies that already have multi-billion dollar federal contracts, said Gourlay.
Mithril Capital Management is an investment fund co-founded by Peter Thiel, who started PayPal and was an early investor in Facebook. Capture2 will use the funding to boost sales, engineering and development.
“The Federal procurement system should be accessible to any person or business, and companies should be able to focus their energy on their products, not the complexity of finding and winning contracts,” said Paul Leggett, managing director at Mithril. “Capture2 is making an opaque process user friendly.”
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