B2B fintechs start 2020 strong with more than $1billion in venture capital funding
While businesses have more sources of capital than ever before, from bank loans to initial coin offerings to alternative online investments, experts are urging small to medium-sized businesses (SMBs) to take a strategic approach to their fundraising efforts — often by combining a variety of funding sources to mitigate risk.
Venture capital (VC) is not easily available to every startup, but recently, VC investors hinted at a big year ahead for the B2B FinTech space. In total, more than $1 billion was raised recently, with funds landing at an array of technologies from B2B payments to payroll to eProcurement.
In its oversubscribed series A funding round, OnPay, a Georgia-based payroll software startup, secured $6 million, the company said.
The firm said it plans to focus on scaling up and product innovation, building out its staff, and strengthening marketing initiatives.
OnPay had initially aimed to raise $5 million in its funding round, and while the company did not disclose who participated in the investment, it did note that former Worldpay U.S. CEO Tony Catalfano will join OnPay’s board of directors.
Designed for the field services industry, Skynamo’s offering connects businesses to a sales app and management solution while enabling sales representatives to reduce their reliance on paper.
With GPS functionality to help managers gain a holistic view of their sales rep teams, and integration with ERP and accounting platforms to manage finances, Skynamo attracted a $30 million investment from Five Elms Capital, the company said this week. The firm, based in South Africa, said it will use the funding to scale operations across Southern Africa, the U.S. and U.K.
In a rarity for B2B FinTech funding, B2B payments startup Flutterwave announced a $35 million fundraise, turning the spotlight to Nigeria’s FinTech community. The company, based in both San Francisco and Lagos, secured the investment from Worldpay, which has also struck a strategic partnership with the firm.
Flutterwave said it will use the funding to further build out its technology and continue expansion throughout Africa, with a focus on enabling African businesses to make payments to other companies both within Africa and abroad.
Operating in the close management space, FloQast connects accountants to technology that can help them close the books more quickly and more accurately. Investors at Norwest Venture Partners, Insight Partners and Polaris Partners provided a combined $40 million in series C funding, which FloQast said will be used to accelerate expansion of its customer base and invest in its technology.
U.K. SMB lender Liberis announced $42 million in new funding this week in support of its platform connecting SMBs to capital based on their future incoming debit and credit card sales.
FTV Capital led the investment, which will be used to expand throughout Europe and the U.S., as well as boost its workforce by 30 percent, the company said. In a statement, Liberis CEO Rob Straathof added that the company plans to expand its product range and onboard new partners.
Offering businesses a platform to discover B2B vendors and manage procurement, Scoutbee announced a $60 million series B funding round led by Atomico, while Lakestar and Next47 also participated, as did several existing investors.
The company said it will use the investment to propel the company’s goal of helping corporate customers save $10 billion a year through strategic supplier and procurement management technologies, as well as to invest in research and development, explore strategic acquisitions, and focus on customer acquisition.
Based in Germany, Personio provides SMBs a human resources management and payroll technology offering that has attracted 67.6 million euros (nearly $75 million) in fresh funding for the firm. Reports in EU-Startups said the company will deploy the series C capital to expand its market presence and promote automation in HR and payroll operations.
Accel led the round, reports said, which also saw participation from a slew of other backers including Lightspeed Venture Partners, SuccessFactors former CEO Lars Dalgaard, and previous investors Index Ventures, Northzone, Global Founders Capital and Picus Capital.
The $pence 90 million euro ($99.5 million) funding round for Tink will be used to help the Sweden-based company build out its open banking platform to facilitate connections between bank accounts and customers. Investors at Dawn Capital, HMI Capital and Insight Partners all co-led the investment, reports said, which will also go toward product development as the company gears up to expand throughout Europe.
French challenger bank Qonto, which targets SMBs as well as freelancers, announced a $115 million series C fundraise led by DST Global and Tencent, as well as other backers, reports this week said. The company aims to connect SMBs with mobile- and online-first banking services and said it will use the funding to strengthen its position within its current markets, upgrade its product offering, and hire new employees.
Accounts payable automation company AvidXchange secured $260 million in new funding this week, with investors at TPG Sixth Street Partners leading the equity capital investment. AvidXchange said it plans to fuel its growth and technological innovation as it continues to build out its accounts payable and accounts receivable solutions for both buyers and suppliers, while encouraging B2B transactions to embrace digitization and electronic payments.
Operating in the retail robotics and artificial intelligence space, Berkshire Grey raised a $263 million series B funding round this week for its technology, enabling retail, eCommerce and logistics fulfillment automation.
Investors included SoftBank, Khosla Ventures, New Enterprise Associates and Canaan, with Berkshire Gray noting it plans to use the investment to finance future growth, strategic acquisitions and staff expansion. Its services include robotics automation in picking, packing and sorting items to enhance warehouse and distribution process automation.