Investors are diversifying their B2B FinTech targets this week as startups operating in the B2B eCommerce and alternative business lending arena secured funding. Commercial card innovation earned the spotlight, however, thanks to new funding for fleet cards, corporate cards for online content creators and a new industry unicorn.
Artificial-intelligence (AI) business lending platform Payhippo, based in Nigeria, has raised $1 million for its portal from Ventures Platform, Future Africa, Launch Africa and Sherpa Ventures. Investors outside of Africa included Hustle Fund and Mercy Corps Ventures. Payhippo said the new funding will enable the company to hire more engineers and continue to target small and micro-sized businesses that remain underserved by traditional lenders.
Based in Kenya, MarketForce has announced a $2 million pre-Series A funding round, TechCrunch reported. The company offers B2B distribution services for retail clients, and the new funding will go towards expansion of its B2B marketplace RejaReja, which enables retailers to buy and sell products and offers a variety of financial services. Existing investors, P1 Ventures and Y Combinator, participated in the investment round, while new backers Launch Africa, V8 Capital, Future Africa, GreenHouse Capital, Rebel Fund, Remapped Ventures and angel investors also contributed, reports said.
Community Capital Technology
Seed funding to the tune of $2.6 million will help U.S.-based business loan marketplace Community Capital Technology continue with its expansion. A press release announcing the funding said Naples Technology Ventures led the round, while 412 Venture Fund and Allegheny Financial group also participated, as did angel investors. Community Capital plans to use the funding to introduce new functionality into its platform, invest in product innovation, and grow its sales and transaction teams as it builds a platform for businesses to access financing and access business intelligence analytics.
India’s Vahak operates a B2B marketplace to connect road transport businesses with individual commercial vehicle owners. The company raised $5.3 million in pre-Series A funding for its technology, with RTP Global leading the pre-Series A round. Luxor Capital, Leo Capital and other individual investors also participated, according to reports. Vahak said it will use the investment to fuel technological innovation and expand its customer base to grow the network.
Fleet card and B2B payments startup Coast secured $6 million in seed funding, TechCrunch recently reported, with Better Tomorrow Ventures leading the charge. Avid Ventures, Bessemer Venture Partners, BoxGroup, Colle, Foundation Capital, Greycroft and SciFi VC, as well as various angel investors, also contributed. Created to address a FinTech innovation gap in the fleet payments space, Coast offers fleet cards and spend management technology. The company plans to roll out its first fleet card product later this year, and with the new funding, Coast will begin to introduce additional tools and features including accounting and telematics platform integrations.
Another B2B FinTech from the continent of Africa this week is Lidya, a small business alternative lender. The Nigerian company announced $8.3 million in pre-Series B funding led by Alitheia Capital while Bamboo Capital Partners, Accion Venture Lab and Flourish Ventures also participated. The company has expanded throughout eastern Europe and, with the new funding, plans to continue strengthening operations in Nigeria, Poland and the Czech Republic.
U.K.- and Spain-based Toqio is a FinTech designed for wannabe FinTechs. The company helps third parties launch their own financial services startups with a white label solutions and out-of-the-box technology to roll out their own products, and investors have taken note. The company recently announced $9.5 million in seed funding led by Seaya Ventures and Speedinvest, while SIX FinTech Ventures also participated. The investment will be used to help expand Toqio’s team, reports said.
Invoice factoring startup Arex Markets landed $10.4 million in Series A funding, with Mosaic Ventures and LocalGlobe leading the investment for the Ireland-based firm. Existing backers Lifeline Ventures and angel investor Richard Laxer also participated, Tech.eu reports said. Arex uses a proprietary algorithm to finance small and medium-sized businesses’ unpaid invoices and can integrate into businesses’ back-office systems to expedite the funding process. Reports did not indicate what the company plans to do with the funding.
Another commercial card startup, Karat Financial, has also raised funding to the tune of $26 million. The company targets a niche business customer base: online content creators and influencers. Its card product aims to address traditional lenders’ lack of understanding of these digital business models, reports said, and its model attracted the Series A investment from Union Square Ventures, GGV Capital and Signal Fire. The funds will help the company expand its value proposition beyond lines of credit and into other services including business loans, taxes and more.
Built to enable small businesses to easily share and integrate their financial data with third parties, Codat has secured $40 million in its Series B funding round, led by Tiger Global. Index Ventures and PayPal Ventures, both existing backers, also participated. Codat said it will use the investment to expand its infrastructure that facilitates data sharing, focusing on application programming interfaces (APIs) that can integrate with payroll and commerce platforms. The firm also said it plans to expand its existing operations in San Francisco.
Digital marketplace Instawork, based in California, helps businesses connect with talent across the country and has just raised $60 million in Series C funding for the solution. Craft Ventures led the round, and Greylock, Corner Ventures, Four River Group, WndrCo, and Tilman Fertitta all participated, as did existing backers Benchmark, Spark Capital, GV, Burst Capital and SV Angel. Instawork said it will use the funding to introduce new job categories and service more industries as well as to invest in services for hourly professionals including job training tools.
The largest investment round of the week for the B2B FinTech community goes to Pleo, a corporate card startup that raised $150 million in a round that propelled the firm to unicorn status. Investors at Bain Capital Ventures and Thrive Capital spearheaded the funding, which values the firm at $1.7 billion, according to reports. Based in Denmark, Pleo said it will use the investment to expand internationally, with a focus on the U.K., and to invest in marketing efforts. An introduction in the U.S. could be in its future too, though Pleo noted that it has not made a definite decision on that move. It is expanding its product offering beyond cards, however, and has introduced invoice management and employee expense reimbursement capabilities, with plans to launch lending services.