RapidRatings: Financial Health Assessments to Manage Supply Chains and Third-Party Risk

We’re excited to announce our investment in RapidRatings, the leading provider of financial health data and analytics for assessing supply chain and counterparty risk.

RapidRatings’ Financial Health scores enable companies of all sizes to manage counterparty risk. With unparalleled data on both public and private companies and one of the most sophisticated analytics platforms in the market, RapidRatings’ has created a proprietary model for measuring risk, and one which creates powerful network effects. A diverse range of blue-chip customers – including industry leaders like Halliburton, McDonald’s, Sanofi, and Unilever – rely on RapidRatings to gain greater financial transparency into their suppliers, manage risk, and build stronger third-party relationships.

Companies that use data and analytics to help their customers measure and manage risk have been a core focus area of Spectrum for more than twenty years, and we have been fortunate to count high-growth risk businesses such as RiskMetrics, Verafin, and World-Check among our portfolio. Yet the forces necessitating operational focus on reducing risk remain as powerful as ever, and the current supply-chain environment crystalizes both the complexity and the necessity of understanding the health of a company’s vendors. Numerous factors, including tightening credit markets and volatility in the availability of goods due to the COVID-19 pandemic, have catalyzed businesses of all sizes to increase awareness and visibility into their supply chains. Many have shifted their supply chain strategy from a focus on cost-optimization to ensuring durability and resilience, especially for critical vendors.

RapidRatings has developed a highly efficient process for collecting financial data on any company (public or private) which they use to create an easily digestible rating. Customers use these ratings to quickly assess the true financial risk of a supplier, such that operators can engage with key partners before experiencing business disruption. RapidRatings can also make data and information on their suppliers accessible to other customers, creating a more robust dataset, and by sharing their financial score, suppliers can attain preferred vendor status and win more business. These powerful business model elements have propelled RapidRatings from rating a handful of private companies in 2010 to providing scores on nearly 27,000 private companies annually in 2021. Furthermore, they have assembled a blue-chip roster of Fortune 500 customers who consistently attest to the predictive value RapidRatings provides in knowing which of their vendors require further attention.

We’re thrilled to partner with CEO James Gellert, a seasoned leader in the risk management space whose vision and industry prowess will help RapidRatings remain a leader in the category. We’re also excited to partner again with our co-investor 22C Capital, whose expertise in the public and private company financial data space will help RapidRatings scale its data collection efforts, product innovation and commercial operations.

Like our other investments in the risk management space, RapidRatings is a category-defining company that has the opportunity to leverage its current position as a trusted analytics partner to become the gold standard in measuring the financial health of any vendor, supplier, or third party. We’re looking forward to partnering with the RapidRatings team to help make this vision reality.