Three former Spotify employees have started a new company aimed at changing how online stores recommend products to shoppers.
Sidd Motwani, Ian Anderson, and Shivaditya Sinha spent years working on the technology behind Spotify's recommendation engine. That system, called Vector AI, powers about 90% of the music suggestions given to Spotify's 800 million users.
Now the trio has built a new startup called Malachyte. It applies a similar approach to online shopping instead of music streaming.
Malachyte announced Thursday that it raised $10 million in seed funding. The money will go toward scaling distribution and hiring more product and commercial staff.
How Malachyte Works
The founders say most online stores treat shoppers the same way. Personalization is often based on past purchases or basic customer data.
That means a first-time visitor usually sees a generic storefront. Returning customers get suggestions based on old purchases rather than what they want right now.
Malachyte's platform uses what it calls a two-headed Vector AI system. It tries to predict what a shopper wants next while also learning their overall taste.
CEO Sidd Motwani explained the system begins forming a picture of the shopper before they even click anything. It uses the context available the moment a page loads.
He gave an example. A shopper searching for "heavy-duty boots" and clicking on steel-toed boots will see work pants and gloves moved higher on the page. Dress shoes get pushed down, without needing an account or purchase history.
Motwani said every action a shopper takes adds information. Hovers, clicks, scrolls, and cart additions all count as signals.
He said most current systems either ignore these signals in the moment or lump them into broad customer groups overnight. Malachyte instead reads them continuously.
The company also looks at context like time of day and device type. Motwani said a shopper browsing from a phone at 11 p.m. after clicking an email link is in a different mindset than someone on a laptop mid-morning.
Funding and Growth
The $10 million seed round was co-led by Bessemer Venture Partners and Gradient. Harpoon Ventures also took part in the funding.
Malachyte has been developing and testing its technology since 2024. The company worked with more than 20 enterprise customers across travel, grocery, and retail before choosing to focus on e-commerce.
The platform first went live in fall 2025 with online retailer Fun.com. Since June 2026, it has been generally available to Shopify merchants through a direct integration.
Larger retailers can connect to Malachyte's technology through its API. This gives bigger companies flexibility in how they add the AI system to their existing sites.
Looking forward, Motwani said the company wants to bring merchandising and marketing teams together around a shared understanding of customer behavior. That is the direction Malachyte plans to grow in next.
