FundThrough has secured a $25 million USD ($34.6 million CAD) Series B round and acquired American invoicing platform Ampla as the Toronto company navigates the unexpected complications of its strong presence in the United States (US).
The all-equity round was led by Klister Credit, with participation from other returning investors, including the Canadian Business Growth Fund and Urbana Corporation. CEO Steven Uster told BetaKit in an interview that the capital will be invested into improving FundThrough’s platform technology, integrating new invoicing software partners, and potential future acquisitions.
“Although we don’t have a specific number, we are always on the lookout for synergistic opportunities,” Uster said in a statement, later adding that FundThrough is “well-positioned to be the consolidator platform.”
CEO Steven Uster claimed that FundThrough has funded almost $3 billion of invoices to date.
Founded in 2014, FundThrough provides invoice factoring for small and medium-sized businesses (SMBs), allowing them to sell their unpaid invoices to FundThrough and get cash upfront for their business needs rather than waiting for a client to pay. Uster claimed that FundThrough has funded almost $3 billion of invoices for thousands of small businesses to date.
Some of FundThrough’s desired technology enhancements are coming through its acquisition of Ampla, the company’s first deal since it acquired one of its biggest competitors, BlueVine, in 2021. Uster said Ampla brings automated onboarding and credit underwriting for SMBs, which will enhance its overall user experience, such as making it easier to directly integrate with other accounting software providers and use its service with the push of a button.
The 2021 BlueVine acquisition dramatically altered the Canadian company’s customer make-up, with 85 percent of FundThrough’s clients now hailing from the US–a disparity the Ampla acquisition may further strengthen–and also grew its revenue by an average of 50 percent per year, according to Uster.
As the company now finds itself in the middle of the economic tensions between the US and Canada that are changing how businesses operate, Uster said it’s fortunate that many of FundThrough’s clients don’t sell cross-border. However, the market chaos has led to an opportunity as many of FundThorugh’s customers “freeze” due to the uncertainty of input costs.
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“Factoring as an industry tends to outperform in times of uncertainty or even in recessionary environments, because banks tighten up and large customers who pay the invoices hold on to their cash for longer, and take longer to pay their small suppliers,” Uster said.
“One of the reasons that we wanted to raise this round is, in a time of uncertainty, we want to be able to serve more small businesses and help them through this, and now we’ll be able to do it.”
Uster declined to disclose any terms of the recent Ampla deal, but said its CEO, Anthony Santomo, is joining FundThrough as an adviser to ensure a smooth transition alongside his “core team” integrating across the company’s engineering, operations, and leadership.
Uster added that he’s “expecting big things” from Santomo, describing him as well-connected in the investor community with a great vision of Ampla’s technology. He also indicated that, if the transition period works out, Santomo may stick around.
“It’s almost like this is the dating period before you get married, I think we both want to see where this goes,” Uster said. “He’s excited about FundThrough and we’re excited about him.”
Feature image courtesy FundThrough.