Plastiq, an automated payments solution focused on small and medium-sized business (SMBs), announced this morning the close of a $75 million Series D funding round.
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B Capital Group led the round, which also included participation from existing backers Kleiner Perkins, Khosla Ventures, Accomplice and Top Tier Capital Partners. The financing brings Plastiq’s total raised since its 2012 inception to more than $140 million.
In recent weeks, I’ve covered a number of funding rounds raised by startups focused on SMBs. In light of the swift and intense economic impact of the coronavirus (COVID-19) pandemic, the efforts of these companies take on a new meaning.
Plastiq CEO and co-founder Eliot Buchanan describes SMBs as the “lifeblood” of our economy.
“In light of the economic uncertainty, now more than ever they will need innovative ways to maximize their working capital and protect cash reserves,” he said.
San Francisco-based Plastiq gives SMBs a way to use their credit cards for just about any expense, even where credit cards aren’t accepted, “for a simple 2.5 percent fee.” It also allows businesses to pay or be paid via a variety of methods, including checks, wire transfers and ACH transfers. The company plans to use its new capital in part to boost its payment options.
The startup also says its platform provides real-time insights into SMB’s payments, cash flow and working capital. It also takes those insights to another level by recommending how and when they pay their business expenses.
Plastiq says it has well over 1 million SMBs and other customers. It also claims to have processed billions of dollars in payments for a variety of expenses such as business supplier payments to contractors, taxes and rent.
The company says in the last year, it has focused particularly on expanding its SMB customer base and as such grown revenue from that segment by 150 percent.
It plans to use the funding to also expand its partnerships with other players in the financial and payments sectors. The company currently works with all major credit card providers, including Mastercard, Visa and American Express.
Karen Page, general partner at B Capital Group, believes SMBs are chronically underserved when it comes to working capital.
“Plastiq’s impressive growth shows they are filling a critical gap by bridging credit access and payables,” Page said.
As mentioned above, I’ve written about several other startups this month alone that have raised money to focus on SMBs in one form or another. On March 11, I reported on how Human Interest, a retirement plan provider for SMBs, closed a $40 million Series C round just months after raising a $15.4 million Series B. That same day, I covered SpotOn, a payments and software startup focused on small and medium-sized businesses, raising a $50 million Series B round of funding. And on March 10, NorthOne, a digital challenger bank focused on small businesses, announced a $21 million Series A raise.
Illustration: Li-Anne Dias