Product managers, tech leads, engineers, and designers collaborate in spectrally named teams to dream up new products for the retail inventory platform. There’s one group named for Pac-Man ghost Blinky and another named for Zero, the red-nosed ghost dog from The Nightmare Before Christmas. I learned this when I asked Ghost founders Josh Kaplan and Dee Murthy about how they felt about Halloween, spooky season, and horror movies. Though both Kaplan and Murthy do like horror movies—Scream and Child’s Play got shout-outs—there’s a more practical explanation for Ghost’s name.

“The reason why we’re called Ghost is because we operate in the background,” Kaplan says. “We want to be this private layer behind-the-scenes that helps power all of these businesses’ inventory operations, and we are a ghost ensuring that their inventory gets distributed effectively across the world.”

That said, it’s going to get harder and harder for Ghost to stay hidden. The startup has raised a $40 million Series C led by L Catterton, Fortune can exclusively report. The round, building on the company’s August 2023 Series B, included participation from existing investors Union Square Ventures, Cathay Innovation, Equal Ventures, and Eniac. 

Ghost is a private B2B marketplace for surplus inventory—”large lots of products, anything you’d find in a department store,” says Kaplan. The cofounders, previously in fashion, started Ghost to address retail industry inefficiencies by allowing buyers and sellers to transact digitally.

The core sellers on the platform are “household brands” with excess inventory, while a typical buyer is Val Zapata, founder of The Shoe Game Co. “Instead of being on the road buying 5-10 pairs of shoes from multiple sellers, I can get on a secure site and look for exactly what performs well with my community,” Zapata said via email.

The brands that Ghost works with don’t necessarily want the general public to know that they have excess inventory. “Scarcity is one of the most valuable tools that the fashion industry utilizes to create demand,” said Kaplan. So, Ghost’s platform lets sellers control who sees their inventory to ensure it’s sold in channels that don’t conflict with their core business. 

Ian Friedman, partner and co-head of technology investing at L Catterton Growth, says the firm talked to 40 Ghost customers and got rave reviews: “Almost every single customer rated Ghost’s solution a nine or ten out of ten. It’s pretty rare to see that much customer love,” he said.

Of course, marketplaces are tricky as a general rule—they can only really work at scale and if they’re big enough. Friedman says he’s not worried about the size of the market for Ghost.

“While the international market is around four times larger, the U.S. alone sees around $500 billion of inventory value moving through the system annually,” said Friedman. “Due to issues like sizing, seasonality and overproduction, about 20% of that is not-first-run or excess inventory. That means that there is about $100 billion of excess inventory moving through the United States annually. That’s a very big market opportunity for Ghost to go after.”

Kaplan and Murthy say that their ambition for Ghost is for the company to be as big as Alibaba, and USV managing partner Rebecca Kaden thinks that’s got legs. 

“I think they have an opportunity to be the largest technology-fueled marketplace of goods,” said Kaden. “A typical TikTok reseller previously had no way to access certain brands of shoes that they can get through Ghost. They would have had to have random individual relationships, which is very hard to do. So, they’re creating access.”

This point about taking excess and turning it into access is essential to Ghost’s ambitions—and values, said Murthy. 

“I know college kids, housewives that have built enormous businesses by stumbling on Alibaba,” he told Fortune. “I’ve seen so many people who don’t know how to manufacture anything build a business on Alibaba that changed their life, and that’s what’s happening on Ghost. We’ve made millionaires already, and we’re changing the way people will enter this business.”

If Murthy and Kaplan reach Alibaba-heights, they’re going to need lots more fictional ghost names. 

See you tomorrow,

Allie Garfinkle
Twitter: @agarfinks
Email: alexandra.garfinkle@fortune.com
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Nina Ajemian curated the deals section of today’s newsletter.

VENTURE DEALS

- Inventiva, a Daix, France-based oral small molecule therapies developer, raised €94.1 million ($102.7 million) in funding. New Enterprise Associates, BVF Partners, and Samsara BioCapital led the round and were joined by Andera Partners, Deep Track Capital, Eventide Asset Management, and others.

- Cytovale, a San Francisco-based commercial-stage medical diagnostics company, raised $100 million in Series D funding. Sands Capital led the round and was joined by Canada Pension Plan Investment Board and existing investors Norwest Venture Partners, Global Health Investment Corporation, and Breakout Ventures.

- REsurety, a Boston-based sustainability goals-oriented software and services provider, raised $32 million in Series C funding. S2G Ventures and Citi led the round and were joined by Angeleno Group and existing investors.

- OroraTech, a Munich-based wildfire intelligence platform developer, raised €25 million ($27.3 million) in Series B funding. Korys, the European Circular Bioeconomy Fund, and existing investor Bayern Kapital led the round and were joined by existing investors Edaphone Private Impact Fund, Ananda Impact Ventures, ConActivity KG, Findus Venture, and others.

- Blue Stripes, a New York City-based whole cacao brand, raised $20 million in Series B funding from Zintinus, The Hershey Company, Whole Foods Market, and others.

- Omnea, a London-based AI-powered procurement orchestration and supplier risk management platform, raised $20 million in Series A funding. Accel led the round and was joined by existing investors First Round Capital and Point Nine.

- Parakeet Health, a San Francisco-based generative AI voice company for healthcare providers, raised $3 million in seed funding. Canvas Ventures led the round and was joined by CoFound Partners, StoryHouse Ventures, Tom Lee, Adam Messinger, and others.

- FullyRamped, a San Francisco-based AI role play platform for sales teams, raised $2.3 million in pre-seed funding. BoxGroup, MaC Venture Capital, and NOMO Ventures led the round and were joined by Greylock and Sequoia.

- Nomos, a Berlin-based energy plans developer, raised $2.1 million in pre-seed funding. Speedinvest led the round and was joined by Eric Quidenus-Wahlforss, Henrik Langeland, Nicolas Benady, and others.

PRIVATE EQUITY

- BGF invested £6 million ($7.8 million) in Signify Research, a Cranfield, England-based healthtech market intelligence provider.

- Shiftmove, backed by Battery Ventures, acquired Optimum Automotive, an Aix-en-Provence, France-based digital fleet management platform. Financial terms were not disclosed.

EXITS

- Centerbridge Partners agreed to acquire Precinmac, a South Paris, Maine-based precision components manufacturer, from Pine Island Capital Partners, Bain Capital's Private Credit Group, and Compass Partners Capital. Financial terms were not disclosed.

OTHER

- Hologic agreed to acquire Gynesonics, a Redwood City, Calif.-based medical device and minimally invasive solutions developer for women’s health, for approximately $350 million.

- Descartes acquired Sellercloud, a Lakewood, N.J.-based omnichannel ecommerce solutions provider, for $110 million.

- Amplitude acquired Command AI, a San Francisco-based AI-powered user assistance developer, for $45 million, inclusive of stock.

- Dialpad acquired Surfboard, a London-based workforce management platform. Financial terms were not disclosed.

FUNDS + FUNDS OF FUNDS

- Adams Street Partners, a Chicago-based private equity firm, raised $1.2 billion for its fourth fund focused on venture fund investments, secondaries, and direct investments.

PEOPLE

- Operator Collective, a San Francisco-based venture capital firm, promoted Dana Marohn Spiliotis to partner.