The team behind Spotify's recommendation engine just raised $10 million to do the same thing for online shopping
Malachyte wants your favourite store to know what you need before you even search for it, using real-time signals instead of last month's purchase history.
Key points
- Malachyte raised $10 million in seed funding, co-led by Bessemer Venture Partners and Gradient, announced Thursday.
- Co-founders Sidd Motwani and Ian Anderson, along with Shivaditya Sinha, previously built Vector AI, the system behind roughly 90% of Spotify's recommendations to its 800 million users.
- Malachyte's platform has been available to Shopify merchants since June 2026 through a native integration.
- The startup worked with more than 20 enterprise customers before focusing on e-commerce.
Three former Spotify engineers built the recommendation system that decides what song plays next for 800 million people. Now they want to apply that logic when you're shopping for work boots at midnight.
Sidd Motwani, Ian Anderson and Shivaditya Sinha spent years developing Vector AI, the system Spotify uses to predict what a listener wants to hear next rather than simply repeating past plays. Motwani says it powers around nine in ten Spotify recommendations. This week the trio announced their new startup, Malachyte, had closed a $10 million seed round co-led by Bessemer Venture Partners and Gradient, with Harpoon Ventures also participating. The money goes toward scaling the product and hiring commercial and product staff.
What problem is Malachyte actually solving?
Most online shops treat every visitor roughly the same. A first-time browser sees the same generic homepage as a loyal customer, and even repeat shoppers get suggestions built on old purchases rather than what they need right now.
Malachyte's fix is what the company calls "two-headed Vector AI," a personalisation engine (software that tailors a shopping experience to each individual) that builds a real-time picture of two things at once: your general tastes and your immediate intent in this session. It starts working before you click anything.
"[Our] system starts forming before the first click, using the context available the moment the page loads," Motwani told TechCrunch. He gave a concrete example: search for "heavy-duty boot," then click two steel-toed options, and the system quietly moves work pants and gloves up the page while pushing dress shoes down. No account or prior history needed.
Every hover, scroll, search refinement and add-to-cart sharpens that picture as you browse. The system also reads device and time-of-day signals: a phone visitor arriving at 11 p.m. From an email link is in a different frame of mind than the same person on a laptop at 10 a.m., and Malachyte treats them differently.
Who is paying for this, and who can use it?
The platform first went live in autumn 2025 with novelty retailer Fun.com. Since June 2026 it's been open to merchants on Shopify, the e-commerce platform used by millions of independent and mid-sized online stores. That timing tracks with what we reported on 5 August: AI-driven visits and orders to Shopify merchants tripled year-over-year in Q2 2025, which makes intent-aware personalisation a sensible next bet. Larger retailers can connect through an API, a technical bridge that lets external software talk to Malachyte's system directly.
| Milestone | Date |
|---|---|
| Technology development begins | 2024 |
| First live deployment (Fun.com) | Autumn 2025 |
| Shopify integration launched | June 2026 |
| $10 million seed round announced | July 2026 |
The company tested with more than 20 enterprise clients across travel and retail before settling on e-commerce as its focus.
Should online shoppers care?
If it works as described, yes: you'd spend less time scrolling past irrelevant products. That said, the experience comes at a cost. The system follows your every move on a site, including hovers and pauses, which is worth knowing before you decide it feels frictionless.
Stories like this often spotlight founders who raised money without asking how many of those 20-plus early test customers actually saw measurable sales gains. Motwani's Spotify credentials are real, but an 800-million-user music app and a mid-sized Shopify store are very different environments. If you run a Shopify store, the native integration means you can trial this without a large technical project. Test it on real traffic before committing to a paid tier.
