Lighting The Way: Lantern is Redefining Forecasting for the $8T Distribution Industry

SAN FRANCISCO, Calif. — November 18, 2025 — For decades, distributors have kept the world running - moving the parts, products, and materials that power every home, building, and business. Yet the systems they rely on for forecasting have barely changed.

Lantern is here to fix that. Using cutting-edge machine learning, Lantern helps distributors forecast demand and optimize purchasing decisions so that they always buy the right items, in the right quantities, at the right times, and in the right places.

"Distribution is the lifeblood of our economy," said Matt Rojas, Co-Founder & CEO. "We have the opportunity to transform how distributors purchase - improving fill rates, reducing excess inventory, and freeing up millions in working capital. What's better than that?"

The stakes are enormous. Distribution is an $8 trillion industry with more than 250,000 distributors spanning every vertical, including HVAC, electrical, building materials, industrial supply, food & beverage, apparel, and beyond. Yet most still rely on spreadsheets, static ERP rules, and basic software to make some of their most important financial decisions.

Born from Real Conversations with Distributors

Matt Rojas and Conor Leen, two of Lantern's co-founders, first uncovered the problem while completing their thesis at Stanford University, where they interviewed over 200 distributors. "Distributors told us the same story again and again," said Conor Leen, Co-Founder & President. "If they buy too much, they tie up millions of dollars in slow-moving inventory. If they buy too little, they miss critical sales. With tens of thousands of SKUs, forecasting manually is an impossible task - but AI can solve it."

That insight became the seed for Lantern: an intelligent system that learns from each distributor's history, blends it with external data like weather, regulations, and market trends, and delivers daily purchasing recommendations with remarkable accuracy.

AI Built for Distributors - Not Just Data Scientists

While most existing solutions rely on rolling averages or static rules, Lantern uses advanced machine learning to recognize cross-SKU and regional dependencies. It doesn't just predict demand - it learns the behaviors of customers, suppliers, and markets over time.

"Today, only giants like Amazon and Walmart have access to this level of technology," said Jay Shitole, Co-Founder & CTO. "We're democratizing it for every distributor, no matter how big or small."

Mike Ofak, Head of Purchasing at Schaedler Yesco, shared: "Our workflows are faster, cleaner, and smarter with Lantern. We can easily access the data we need without digging through ERP screens."

Lantern's models extend far beyond demand forecasting to include lead time prediction, order frequency optimization, safety stock allocation, and bulk buying decision-making - all tuned to each distributor's unique business rhythm.

Jonathan Pope, COO and CFO of R&E Supply, said: "With Lantern, we hold significantly less inventory, our turns are up, and carrying costs are down. These efficiencies have provided massive boosts to our enterprise value."

Results That Speak for Themselves

Lantern's early customers are already reporting up to 40% improvements in inventory turns and 99% fill rates, all while reducing total inventory dollars held.

Monte Caplan, CEO of CAPP, summed it up simply: "With Lantern, we've achieved what many consider impossible. We're holding less inventory while delivering higher service levels, and our customers are thrilled."

And beyond performance, implementation is seamless. "Lantern made onboarding effortless," said Kevin Szymanski, VP of Strategy and Operations at Kele. "It was the smoothest implementation I've had."

Why Now: The Perfect Moment for Lantern

Three converging forces make this the perfect time to bring AI to distribution.

First, AI is now the norm rather than the exception. With everyone using ChatGPT, distributors are asking the same question: where's our version of this? Every distribution CEO is asking their teams to define an AI strategy and find ways to use the technology effectively. Lantern delivers that answer.

Second, it's never been harder to be a distributor. Once-in-a-generation disruptions are now annual events - from tariffs to labor strikes and the Red Sea crisis, and before that, COVID. Each shock squeezes margins and exposes the fragility of traditional planning. Distributors need tools that can see around corners - predictive systems that help them react instantly and future-proof their operations.

Third, a wave of generational transitions and private equity investments in distribution is driving modernization across the sector. With more attention on working capital optimization and data-driven decision-making, distributors are embracing technology like never before - and Lantern gives them the modern foundation to build on.

The Future is Bright for Distributors

"Distributors are ready," said Rojas. "They're watching AI transform every other industry and know their time has come. With Lantern, they don't need data scientists - just a desire to win."

Leen added: "We come from the same communities as distributors. We share their values - hard work, humility, and pride in a job well done. It's an honor to serve them."

Lantern is advised by Warren Chaiken, Mike Marks, Keith Hubbard, Konrad Konarski, Paul Kennedy, Jason Bader, Pierre Barbeau, and Julian Francis.

Lantern is backed by Pear VC and angel investors from the distribution industry.