Covalo's 145% net revenue retention suggests cosmetics companies are finally embracing digital infrastructure—or at least running out of alternatives.
When spreadsheets and email attachments become the bottleneck in a multi-billion-dollar industry, someone usually shows up with a better solution. Whether anyone actually adopts it is another question entirely.
Zurich-based Covalo announced a €3.5 million seed extension on April 2, 2026, led by French deeptech investor Hi Inov, with participation from existing backers HTGF and seed + speed Ventures. The round itself isn't particularly large. What caught attention: the company's claim of 145% net revenue retention in 2025, a figure that, if sustained, suggests customers aren't just staying—they're spending considerably more over time.
For context, a 23-person company serving the unglamorous middle layer of the cosmetics supply chain—connecting ingredient suppliers to beauty brands—doesn't typically post expansion metrics in that range unless something fundamental is shifting.
The Spreadsheet Problem, Quantified
Covalo's pitch is straightforward, if not exactly thrilling. The personal care and cosmetics industry still runs largely on PDFs and email chains when it comes to ingredient data. A brand formulating a new moisturizer requests specifications from a supplier. The supplier sends a PDF. The brand manually enters that data into its product lifecycle management system. When a specification changes—or when a regulation forces a reformulation—the whole dance starts over.
Covalo built what it describes as a "shared data backbone" to replace that workflow. In practice, the platform connects supplier product information management systems directly to brand PLM platforms, automating what used to be manual back-and-forth. As of April 2026, the company says it hosts specifications for more than 80,000 ingredients, linking 1,500 suppliers to some 6,000 brands across 145 countries. Among its named customers: Givaudan, Symrise, PUIG, and La Prairie—established players, not experimental upstarts.
Platform engagement climbed 84% in 2025, according to the company, with users logging 1.3 million monthly interactions. Those numbers hint at real usage, though Covalo didn't break out revenue figures or disclose what share of its customer base drives that retention metric.
From Discovery Tool to Critical Infrastructure
Covalo spun out of Clariant's Chemberry ingredient search platform in March 2021, led by co-CEOs Yann Chilvers and Timo von Bargen. The 35,000 registered professionals now using the system represent a notable expansion from its origins as a discovery marketplace. Somewhere along the way, the company stopped being a nice-to-have search tool and started positioning itself as foundational infrastructure—the kind of product that becomes harder to rip out once embedded.
That shift matters. Discovery platforms compete on features and user experience. Infrastructure competes on switching costs and network effects.
Last December, Covalo acquired Cosmetitrovo, an Italian ingredient platform, in what looks like a regional consolidation play. The company hasn't disclosed integration timelines or whether the acquisition brought meaningful new customer relationships. More tangibly, an October 2024 partnership with Trace One embeds Covalo ingredient data directly into the Devex PLM system, allowing brands to pull updated specifications automatically. That kind of integration—workaday and technical—tends to stick.
Regulation as Revenue Driver
Then there's the regulatory angle, which Covalo is leaning into. The EU's microplastics restriction, Regulation 2023/2055, took effect in October 2023 and is forcing reformulations across the cosmetics sector. Covalo estimates that roughly 80% of products will need reworking by 2030—a company projection, not an independent analysis, but one that tracks with the regulation's breadth.
When compliance certificates or ingredient specifications change under these rules, Covalo's system can push updates to every brand using that ingredient. As regulatory requirements proliferate—and they are, across markets—that capability becomes less of a feature and more of a necessity. Or so the pitch goes.
The question is whether that's enough to justify Covalo becoming the system of record for an industry that's managed without one for decades.
AI Agents and the Usual Roadmap
The new capital will fund what you'd expect: enterprise sales expansion and product development. Covalo plans to launch "industry-specific AI agents" for conversation analytics, RFI and RFP automation, data extraction, and compliance checks. The company also intends to build full PIM and master data management tools, moving deeper into supplier infrastructure.
Whether those AI features generate new revenue or simply keep competitors at bay isn't clear yet. Plenty of vertical SaaS companies are sprinkling AI onto existing workflows and calling it innovation. The difference—perhaps—is whether the underlying data and integrations create enough friction that customers can't easily switch even if a competitor builds something shinier.
For now, Covalo seems to be doing the unglamorous work: building connective tissue for an industry that never quite digitized, one integration and compliance update at a time. If that 145% net revenue retention holds, it won't matter whether the product is boring. It'll matter that it became essential.
