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When cloud providers like Microsoft Azure and AWS launched cloud software marketplaces a decade ago, it opened up a new sales channel for software-as-a-service (SaaS) companies to get in front of potential enterprise customers. These marketplaces effectively enabled SaaS companies to bypass the traditional, lengthy sales cycles.
But rarely is the seller-side experience a walk in the park. Getting software listed on these marketplaces requires multiple engineers, and the overhead burden only increases as a company scales.
Jon Yoo and Chengjun Yuan know the problem well from their respective times working at Salesforce and Confluent. The pair decided to launch a company, Suger, to lessen the operational challenge associated with selling via cloud marketplaces.
Suger is a toolkit that automates SaaS product listing across various marketplaces and manages these listings as they scale up. The platform’s unified APIs integrate with a company’s billing, customer relationship management, and other existing tools.
Yoo said that Sugar can help with a variety of cloud marketplace-related tasks, including flexible pricing, revenue reports, and delivering buyer insights.
“We built a workflow so that we can orchestrate all these actions that these people do as a day-to-day job,” Yoo told TechCrunch. “Let’s automate each part in the lifecycle of a transaction, like each node, so that we can help them transact at scale. That’s really starting to play out. We look at our data and we see that our customers, on average, 3x their marketplace volume when they switch over to us from an in-house solution or a competitor product.”
Suger launched at the end of 2022. Since then, the company’s customer base has grown to more than 200 companies including Snowflake, Notion, and Intel.
Suger recently raised a $15 million Series A round led by Threshold Ventures with participation from existing investors including Craft Ventures, Intel Capital, and Y Combinator. Yoo said the company received multiple term sheets pretty quickly, as many of the investors Sugar spoke with have portfolio companies struggling to wrangle cloud marketplaces.
Some prospective investors told Yoo that Suger would struggle to raise in this funding environment because it wasn’t marketing itself as an “AI company.” Clearly, that didn’t dissuade many backers.
“We leverage AI internally in our product, but AI is just technology,” Yoo said. “AI can be the underlying technology, but what is the actual value that we are providing to our customer? At the end of the day, they want to make sure that we are helping them do their jobs and supplementing the work they’re doing, versus kind of this marketing fluff.”
The use of cloud marketplaces continues to be a growing part of enterprise sales. Salesforce CEO Marc Benioff said that in its second quarter of fiscal 2025, three of Salesforce’s top ten largest deals were closed through AWS’ cloud marketplace.
Yoo added that many young AI startups are looking to cloud marketplaces as a sales channel right off the bat.
“It’s a massive market,” Yoo said. “It’s started to become not just a nice-to-have channel, but really a must-have channel if you are selling to enterprises.”
There is competition in Sugar’s sector, to be clear. Some companies build their own cloud marketplace listing systems in-house, while others turn to startups like Tackle, which has raised more than $148 million in venture funding and offers capabilities similar to Sugar’s.
Yoo said Suger has the advantage of being a second mover. (Tackle launched a few years prior.) Suger also goes beyond just the listing process, Yoo added, where Tackle is mainly focused.
Yoo said Sugar will put its fresh funds toward building out its product and expanding its engineering bandwidth. Eventually, Suger hopes to build tools for the buyer side, as well, helping enterprises procure software and manage their spend.
“[We’re] really excited for the future, and also not just the future of the company, but also the future of cloud marketplaces,” Yoo said. “We really want to bring that consumer experience to B2B sales, because it just does not make sense to me that it takes two years for an enterprise sales cycle.”
