FinTech startup Village Wellth is a bit wealthier itself after securing a $400,000 CAD seed round.
The startup said that a cross-section of industry supporters, advisors and business buyers participated in the raise, which closed at the end of November, 2021. One of the undisclosed investors is joining the startup’s board.
Village Wellth will use the new funds to increase the size of its team, and continue to scale its product. The startup offers an online platform and digital community meant to make the process of business acquisition less complicated and more accessible. The platform is designed for use by buyers in mergers and acquisitions.
“We let the market guide us as to what we’re building.” -Robert Irwin, CEO
“We’re focused on engaging buyers and have successfully launched an open banking feature called one-click financial verification,” co-founder and CEO Robert Irwin said. “This digital verification will allow us to verify a buyer’s funds while keeping the buyer anonymous. It’s quick, secure, seamless, and literally completed with a click of a button.”
The startup lists prospective buyers and sellers on its website, aids buyers in due diligence, and connects them with vetted professionals who can provide advice. Village Wellth also helps structure offers and assists with negotiations.
Irwin said the actual process of acquiring businesses requires people to navigate a system he described as fragmented and broken. “It’s filled with fax machines and useless NDAs [non-disclosure agreements],” Irwin said. “There is little transparency in the process of acquiring a business, information is difficult to obtain and opportunities often remain closed to the average Canadian.”
According to Irwin, Village Wellth is democratizing data that was previously unavailable to the average person. The startup claims to do this by aggregating business listing data, and providing one-of-a-kind insight to empower Canadians to pursue buying a business as an option for wealth creation.
“From the very beginning we’re attempting to reverse the marketplace,” Irwin said. “Everything is about the sell side.”
Co-founder and president Liz MacRae explained: “We’ve created a pool of educated buyers and made them accessible to the ecosystem, rather than having buyers blindly trying to find businesses for sale. There is a real need in the marketplace for Village Wellth to solve this problem quickly and bring a new league of buyers to business acquisition.”
Irwin told BetaKit that currently everyone looks at listings, browsing and waiting their time. “It’s like Tinder or financial entertainment,” he said. “And it doesn’t help the system, so we thought the buyers, even though there’s a lot of them, they’re the ones who make this thing go around.”
However, Irwin claimed that brokers don’t like buyers because there are too many of them, and are viewed as tire-kickers. “So we’ve devised a way to process that glut of buyers and educate them,” he said. “We put our arms around the buyers, and now they become searchable to sellers.”
Currently, the site has hundreds of buyers listed. They range from individuals to brokers representing buyers. For instance, one describes themself as a professional engineer looking to buy a small business as an investment vehicle. Another says it is building a portfolio of established commercial and industrial businesses in Nova Scotia.
The way Village Wellth proposes to earn revenue from the platform is through buyer subscriptions. For $39 a month, buyers gain access to tools and resources to help them navigate and accelerate them through the acquisition process. As well, the startup offers added services for fees such as search services.
Irwin estimates the startup has about 70 paying users, but said that Village Wellth isn’t monetizing its users yet. “We’re validating our services and products by selling them, which is great, but that’s not actually our objective right now,” Irwin noted. Rather, he said the objective currently is to get as many users onto the platform as possible.
Irwin said it’s hard for him to know if any successful transactions have been done through the site. “It’s hard to tell because we don’t take a transaction fee, so there’s no reporting back to us,” he said. “We’ve walked a lot of buyers right to the edge, and then off they go. It’s sort of like a dating site.”
Founded in late 2020, Village Wellth has four founders (the other two besides Irwin and MacRae are Gisele Savoie, and Mahtaab Brar) and two employees. Irwin said that since the startup began, Village Wellth has been doing lots of research, and testing the market to see what sort of solutions people want. “We let the market guide us as to what we’re building,” he said. “This is what they’re asking for, so this is what we’re building.”
Photo courtesy of Village Wellth.