Fundbox

Fundbox is a financial services platform based in San Francisco that offers credit and payment solutions to small businesses. Founded in 2013, the company uses big data analytics, engineering, and predictive modeling to help optimize cash flow for small businesses. The organization has received funding from venture capital firms such as General Catalyst Partners, Khosla Ventures, MUFG, Bezos Expeditions, and Allianz. As of 2019, the company had raised a total of $433.5 million in funding from at least 14 investors.

Fundbox
FoundedJanuary 2013
FounderEyal Shinar, Tomer Michaeli, Yuval Ariav
HeadquartersSan Francisco, California
Websitefundbox.com

History

The concept for Fundbox was partially inspired by executive chairman and co-founder Eyal Shinar's mother, who struggled with late payments at the employment agency she owned and operated in Israel.[1] The company was officially launched in April 2013 by Yuval Ariav, Eyal Shinar, and Tomer Michaeli.[2] operating for approximately one year in stealth mode, the service became available to the public in April 2014.[2]

Since the organization's launch, hundreds of thousands of businesses have connected to the Fundbox platform.[2]

Funding

Fundbox emerged from a stealth operations mode in April 2014 and announced it had raised a $17.5 million Series A investment round.[3][4] Khosla Ventures led the round with support from SV Angel, Vikram Pandit, Tom Glocer, as well as other individual investors.[5][6][7]

In March 2015 the company closed a Series B funding round of $40 million.[8] The round was led by General Catalyst Partners with additional support from NyCa Investment Partners. Previous backers, such as Khosla Ventures, Shlomo Kramer, and Blumberg Capital, also participated in the financing round.[1][9]

In September 2019 Fundbox successfully announced they had raised $176 million Series C investment round. This round was led by a consortium of funders, including Allianz X,  Healthcare of Ontario Pension Plan, HarbourVest and a litany of others. Existing backers Khosla, General Catalyst, and Spark Capital Growth also participated[10] With this investment they have raised over $400 million.[11]

Services

Fundbox's primary offering is a revolving line of credit where companies can apply and get a decision in minutes.[12] The credit is intended for use by small businesses in the business-to-business space seeking to optimize cash flow and continue to successfully run their businesses while waiting for accounts receivable invoices to be paid.[2][13] This enhancement in cash flow is intended to help companies maintain consistent operations and make investments such as new equipment or payroll.[12]

Use

To establish a Fundbox account, users are required to link either their accounting platform or their business bank account with Fundbox.[3] There is no fee for this registration, connection, and approval process.[3] Fundbox then uses data analytics tools such as data science engines and machine learning algorithms to determine a credit line.[3] A typical credit line can vary between $2,500 and $150,000.[12] Before clearing an invoice, Fundbox customers can see the fee, which is based on the risk and probability of repayment.[4][14]

Once a customer draws, Fundbox deposits the money directly into the customer's bank account between 24 and 48 hours.[2][15]

Repayment

Customers can choose between 12 or 24 week repayment. Repayment is completed through weekly payments that are automatically debited from a customer's bank account.[12]

References
  1. Lapowsky, Issie (March 19, 2015). "Startup Raises $40M to Keep Small Businesses' Cash Flowing". WIRED. Retrieved May 18, 2015.
  2. Magee, Christine. "Fundbox Raises $40 Million To Pay Invoices On Demand". TechCrunch. Retrieved May 18, 2015.
  3. Wienglass, Simona. "Clients won't pay promptly? Fundbox uses machine learning to advance you cash". Geektime. Retrieved May 18, 2015.
  4. Goodman, Michelle (December 8, 2014). "This Startup Bridges Cash Flow Gaps, One Invoice at a Time". Entrepreneur. Retrieved May 18, 2015.
  5. Rao, Leena (April 10, 2014). "Lending Startup Fundbox Raises $17.5M From Khosla To Help SMBs Improve Cash Flow". TechCrunch. Retrieved May 18, 2015.
  6. Novet, Jordan (April 10, 2014). "Fundbox gets $17.5M to give small businesses money when they need it". VentureBeat. Retrieved May 18, 2015.
  7. Abruzzese, Jason (April 10, 2014). "Fundbox Looks to Streamline the $74 Trillion B2B Invoice Market". Mashable. Retrieved May 18, 2015.
  8. Billings, Mike. "The Daily Startup: Fundbox's Funding is Latest in Short-Term Lending Sector". The Wall Street Journal. Retrieved May 18, 2015.
  9. Holley, David (March 19, 2015). "Fundbox Clinches $40M Series B for Short-Term Lending Product". Xconomy. Retrieved May 18, 2015.
  10. "Fundbox raises $176 million Series C to build 'Visa' for B2B payments". TechCrunch. Retrieved 2020-01-31.
  11. "List of Fundbox's 6 Funding Rounds totaling $433.5M". Crunchbase. Retrieved 30 January 2020.
  12. Cowley, Stacy. "Online Lenders Offer a Faster Lifeline for Small Businesses". The New York Times. Retrieved May 18, 2015.
  13. Slade, Hollie (April 10, 2014). "Fundbox Raises $17.5M Series A To Bridge Gap Between Invoices For B2B". Forbes. Retrieved May 18, 2015.
  14. Panagiotis, Semitekolos. "How Fundbox is Changing Small Business Financing". Startup Hook. Retrieved May 18, 2015.
  15. Sophy, Joshua (March 26, 2015). "Fundbox Provides Options to Borrow on Unpaid Invoices". Small Business Trends. Retrieved May 18, 2015.
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