The U.S. government issues over 11 million contracts annually, totaling hundreds of billions of dollars—a tremendous opportunity for vendors. However, navigating the federal contracting landscape is challenging due to the inherent red tape and bureaucratic hurdles.
Companies looking to secure government contracts must first become eligible for awards, a process that can be complex. They must also provide accurate representations and certifications, complete several “standard form” documents, and adhere to intricate federal acquisition regulations. On average, vendors can wait anywhere from several months to over a year before receiving contract awards.
Mike and Nick Weiland know firsthand the challenges of obtaining government contracts. They established Telescope to focus on prime government contracting opportunities but quickly realized the necessity of dedicating an entire department to compliance and sales. “There was a significant need—not just for identifying opportunities, but for collaborating and sharing those opportunities beyond email,” said Mike, the CEO of this startup.
To address these challenges, Mike and Nick partnered with entrepreneur Jon Wright to create Govly, a platform that allows companies to evaluate, search for, and analyze government contract requirements from various sources. Supported by Y Combinator, Govly recently secured a $9.5 million Series A funding round led by Insight Partners, which valued the startup at $41 million post-money.
“Govly is a market network designed for public sector procurement,” Mike explained. “Our platform minimizes the risk of any participant in the supply chain missing an opportunity or modification notification.”
Govly operates primarily through SAM.gov, the official portal for tracking vendor eligibility for federal funds, to identify potential contract opportunities. The platform also integrates other contract feeds, enabling users to create targeted searches and receive notifications for new opportunities that meet their criteria.
To improve contract search quality, Govly leverages advanced AI technologies, including OpenAI’s GPT-3.5 and AWS Comprehend. These tools help highlight critical aspects of contract opportunities such as descriptions, due dates, and locations, while also standardizing various government classification codes (e.g., North American Industry Classification System).
In addition to contract searches, Govly automates contracting workflows and facilitates task coordination for initial solicitations, allowing businesses to collaborate with partners in responding to solicitations and potentially uncovering new partnerships. For instance, a Govly customer could team up with another organization on the platform to share data and collaborate on government contract proposals.
“Govly serves the entire supply chain of government contractors, with unique value propositions for each group—prime contractors, resellers, distributors, and OEMs,” Mike said. “Prime contractors utilize Govly to manage their contracts and share information with resellers. Resellers and OEMs use the platform to connect with primes for access to contracting opportunities, while distributors monitor where their technologies are requested in the federal market and communicate with their partners.”
Govly faces competition from companies like Bloomberg and GovWin but is rapidly expanding. With an annual recurring revenue of approximately $1.2 million, the startup anticipates reaching profitability by the end of 2023. Currently, a team of eight supports around 400 organizations, from paying enterprises to users on limited free access.
The funds from the Series A round will be directed towards scaling Govly's team and broadening the platform's offerings from primarily IT contracts to include state and local education opportunities, according to Mike.
“The U.S. government remains the largest procurer of goods and services in the U.S. and ranks among the top globally. Govly is helping organizations build and maintain public sector relationships and secure contracts,” he added. “Our goal is to address access issues by creating a network that allows the entire supply chain of government contractors to discover, track, collaborate, and win more business—from small businesses to large enterprises. Instead of an emailed opportunity trickling down from ‘.gov’ to primes, resellers, distributors, and OEMs, Govly streamlines collaboration and enables instant sharing and working on opportunities within a unified platform.”
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