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Alt-Lending Makes A B2B VC Comeback

Another lucrative week for the B2B FinTech space yielded more than $480 million in equity and venture capital funding. Alternative lending is making a comeback on the charts, while freelance FinServ also secured new backing, but it was the payroll technology arena that came out on top.


With a focus on the construction industry, Flexbase offers technology for contractors to manage billing and payments. The Miami-based firm recently announced a $2.5 million pre-seed investment from Hustle Fund, Suffolk Technologies, Equipment Share, Romulus Capital, Chapter One, Banana Capital, Social Starts, Great Oaks Venture Capital and Sriram Krishnan. Flexbase said it would use the investment to focus on platform growth, expand its workforce and fuel innovation of its technology that aims to ease the cash flow crunch of contractors struggling with unpredictable payment cycles.


Targeting the self-employed and freelancers with banking technology, Lance is a FinTech that provides tax and spend management solutions, spend and payment tools, and other features for professionals. The company recently announced $2.8 million in seed funding in conjunction with its business account product launch, with investors at Barclays, BDMI, Great Oaks Capital, Imagination Capital, Techstars and DFJ Frontier, plus angel investors, all participating.


Based in Chile, Kredito is an alternative business lending FinTech that just raised $4 million in pre-seed funding. The company targets small businesses that struggle to access credit and loan products when they open a business bank account, using proprietary underwriting technology to connect SMBs to traditional bank loans. Reports in TechCrunch said the company is also stepping into the business payments space with the development of a debit card for SMB users. Maurice Khamis and Family, Link Capital Partners, Patio Group Partners, Karim Fajardin and other family offices all participated in the round.


Ireland’s Payslip, which provides automated payroll technology for business customers, has secured $10 million to top up its Series A funding round, with MiddleGame Ventures and Mouro Capital leading the charge. Frontline Ventures, and individual investors also participated. Payslip said it will use the funding to expand its efforts to help multinational businesses manage cross-border payroll through technology like data standardization, analytics and compliance tools.


Found, a FinTech targeting self-employed and freelance professionals, has secured $12.75 million in funding led by Sequoia, reports in TechCrunch said recently. The funding, which also saw participation from angel investors, will be used to support the company’s efforts to support financial management for entrepreneurs, focusing on expense management and taxes, though the company is working to build out a suite of services in areas like banking, accounting and more.


Alternative lender Settle targets eCommerce and consumer packaged goods businesses with technology to access working capital, and investors at Kleiner Perkins have backed that tool with a $15 million Series A investment round. The company aims to help businesses facing a massive influx in demand among consumers to manage working capital, which can face restraints from inventory purchases and other factors, to access funding by integrating into these firms’ accounting software and underwriting working capital products. Included in its offering is a trade finance product, in which Settle pays suppliers on behalf of its business customers, which then repay Settle.


Denmark’s Pento is another payroll FinTech that landed on the board this week, raising $15.5 million in Series A funding led by General Catalyst. Avid Ventures, Local Globe and several existing investors and angel investors also participated. Reports said that Pento, which provides businesses with technology to modernize payroll operations, will use the funds to expand its global workforce, expand into new geographic markets and invest in product development.

Boost Insurance

Business InsurTech startup Boost Insurance announced a $20 million Series B funding round this week, with investors Fin VX, Gaingels, Hack VC, Greycroft, Coatue and Conversation Capital all participating in the investment. The company offers an Insurance-as-a-Service platform to help companies integrate and embed their own insurance solutions for their customers. Boost said it will use the funding to fuel growth.


With a focus on B2B payments between growers and distributors in the produce sector, ProducePay aims to tackle the friction linked to a fragmented market. Investors at G2VP, IFC and IDB Invest also fueled a $43 million Series C equity round for the company, while other backers included Anterra Capital, Coventure, Astanor Ventures, IGNIA and Finistere. In addition to financing tools for the industry, ProducePay also offers market pricing analytics technology as well as a B2B marketplace for businesses. The company said it will use the funding to invest in its infrastructure, expand its sales team and grow throughout Latin America.


Cross-border business payments technology FinTech Thunes, based in Singapore, has raised $60 million from Insight Partners. The Series B growth round also saw investment from existing shareholders, and will be used to accelerate investment in operations, product and technology, enabling corporates and financial institutions to facilitate the movement of money internationally for their own customers.


A leader in this week’s roundup, and the roundup’s only new unicorn, is India-based Moglix, a B2B eCommerce technology firm that raised $120 million in Series E funding. Investors at Falcon Edge Capital and Harvard Management Company led the investment, while Tiger Global, Sequoia Capital India and Venture Highway also participated. Targeting India’s manufacturing landscape, Moglix aims to digitize the buying and selling between businesses with its digital marketplace. The company said it will use the investment to support its focus on developing a full-stack service for manufacturers that includes procurement, supply chain finance, packaging and more.


In a clear sign of support among investors for payroll FinTech, New York-based DailyPay has secured $175 million of equity for its Series D investment round led by Carrick Capital Partners, while existing backers also participated. The investment is part of a broader $500 million fundraise. The rest is made up of credit capital, which will collectively be used by the on-demand payroll technology provider to focus on growth and identify new market opportunities as more employees seek the ability to access wages as they are earned.

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