Canals, a Miami-based provider of an AI operating system for wholesale distributors, has raised $35M in Series A funding led by Base10 Partners. The platform automates quotes, orders, invoices, and PO tracking from any format for electrical, plumbing, HVAC, and industrial supply chains. The capital will accelerate expansion of its end-to-end transaction automation suite.
AI Adoption Splits Wholesale Distribution
The timing aligns with accelerating AI adoption in wholesale distribution amid labor shortages and ERP modernization. Competitors like Distro position agentic AI for order entry while Parspec focuses on quoting and takeoffs. Canals differentiates through multi-department coverage across sales, accounting, and purchasing without templates or heavy customization.
Legacy Processes Drain Distributor Margins
Wholesale distribution operates within a $60.08 trillion global market in 2025, projected to reach $63.7 trillion by 2026. Distributors still rely heavily on PDFs, spreadsheets, and manual entry, leading to slow quote responses and missed bids. Current generic tools fail to handle irregular industrial inputs like handwritten notes or complex product lists, forcing teams to key orders by hand.
End-to-End Operating AI Targets Revenue
Canals built industry-specific models trained on electrical, plumbing, HVAC, and MRO complexities. The system processes quotes and orders from email, PDF, or spreadsheet, pushes to ERP in hours rather than months, and achieves 96% touchless invoice processing along with 99% cash application accuracy. Unlike AP-only platforms or sales-centric alternatives, it covers the full workflow from quote conversion to payables.
As CEO Michael Delgado noted:
"Our customers operate in the real world, with messy inputs. Canals is the real deal."
Base10 Backs Real-Economy Automation
Base10 Partners led the round, drawn by Canals' alignment with its thesis on automation technologies for traditional sectors. The firm sees strong strategic fit in Canals' proven ROI for 50-200 employee distributors scaling operations. The investment signals conviction in vertical AI that delivers day-one value rather than lengthy implementations.
Wholesale Market Embraces Vertical AI
The broader wholesale market grows at 6% CAGR while the AI automation subset expands at roughly 20% CAGR. Canals has already processed more than 8 million sales orders and $5 billion in payables across dozens of customers including Regency Supply and Kendall Group. Early adopters report quote-to-order rates rising from 20% to 57%.
Hiring Push Follows Series A
With the new funding, Canals announced hiring across every team to deliver additional workflow solutions faster. The company also plans to deepen partnerships within industry associations such as NAED and HARDI while expanding its presence at events like TUGConnects.