Magentic Raises $18M to Build the AI Workforce for the Physical World
Magnetic, providing AI digital workers for operations at large industrial companies, led by Robin Van Aeken and Odhran O'Donoghue, has announced an $18 million Series A. The round was raised a year after launch and led by Felicis, alongside existing investors Sequoia Capital and The Westly Group.
"The physical world is dealing with the biggest capex cycle in history, driven by AI demand, during a time of trade disruption and geopolitical challenges," said Robin Van Aeken, CEO and co-founder of Magentic. "The companies that build the best intelligence into every decision they make will be the ones that compound their competitive advantage.”
The funding comes as industrial and procurement teams face rising manufacturing demand, tariffs, and tighter budgets. Goldman Sachs projects roughly $8 trillion in AI capital spending from 2026 to 2031, much of it tied to physical infrastructure. Meanwhile, procurement workloads have grown about 10% year over year against just 1% budget growth.
AI Digital Workers for Operations.
Magentic’s AI digital workers operate as multi-agent systems across Microsoft Teams, email, and enterprise systems, taking on procurement tasks end to end, from supplier selection and contract negotiation to orders and invoices.
Built for the scale of global manufacturers, the platform works across fragmented data and legacy systems while keeping people in control. Magentic supports both indirect and direct spend, including raw materials. Customers have processed more than a million orders through its agents, with one reporting $4 million in savings. Across its Global 500 customer base, Magentic typically delivers 2–5% savings, improves data quality by 60%, and cuts tens of thousands of hours of manual work.
"Supply chains are the least glamorous part of the economy, yet the most consequential, deciding what gets built and what does not. That's also what makes them so hard to automate," said Feyza Haskaraman, Partner at Felicis. "Getting an agent to understand a manufacturer's complex systems well enough to take action inside them is no small feat, which is why we haven't seen anyone else build autonomous AI workers for the physical economy."
Scaling a Secure AI Workforce.
As enterprises remain cautious about AI agents operating in critical systems, Magentic is designed for stringent security requirements, including zero-data-retention agreements, flexible cloud deployment, and isolated environments across data regions.
The new funding will expand Magentic’s AI agent roadmap, broaden coverage across procurement and supply chain workflows, and advance research into complex optimization problems.
"Bringing frontier AI to the physical world requires pushing beyond AI systems with limited context windows. We’re building AI that can diagnose problems, plan the fixes, take action, and see the work through across terabytes of multimodal data at once," said Odhran O'Donoghue, CTO and co-founder of Magentic.
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