B2B Payments

B2B Investment Tracker, March 6-13

Venture capitalists were largely quiet in the B2B space this past week, but the limited number of investments fueled a diverse range of business-to-business services, from marketing technology, to alternative lending, to e-billing. The last several days also saw significant investment from some high-profile backers, including the founder of Indeed.com and an early Yahoo! Investor. B2B funding was certainly muted last week, but Zuora managed to make a splash late in the game with a $115 million funding round. The largest potential investment – which could reach up to $700 million – remains only hearsay, but should definitely remain on the radar.

Trailing from the energy from last week’s big B2B SaaS investment boom, Growth Intelligence announced Monday (March 9) that it has raised $3.4 million in its first fundraising round thanks to some high-profile backers including early Yahoo! Backer John Taysom, Indeed.com founder Paul Forster, and early Google employee and chief economist Hal Varian, among others.

“Gi has all the ingredients for success,” said Forster. “A big market – ultimately all B2B firms; a brand new business application in Predictive Marketing, harnessing artificial intelligence to drive measurable ROI growth for its clients.”

Gi aggregates Big Data and offers analysis software to provide insight into how businesses will respond to a B2B marketing approach. According to reports, some of its largest clients include Google, BT and American Express. The startup revealed that it will use the funding to boost hiring and increase client ROI, as well as perfect its algorithm development.

According to Gi Founder and CEO Tom Gatten, the financial backing marks a crucial milestone for the company. “Being able to predict whether a deal will close before you contact a prospect dramatically increases the efficiency of our clients’ marketing,” he said in a statement.

Investment largely quieted down until Wednesday (March 11), when peer-to-peer lending platform StreetShares revealed that it has secured more than $200 million for loans issued through the service. The company revealed that the funding, submitted by Direct Lending Investments, Community Investment Management and Eagle Bank Corp, will be funneled into small businesses headed by veterans over the next four years.

“StreetShares provides responsible and transparent financing to underserved small businesses to drive economic growth and job creation,” said Community Investment Management managing partner Jacob Haar. “We believe their innovative approach to lending and focus on veteran-owned small businesses creates significant long-term value for borrowers, local communities and investors.”

StreetShares has also reportedly formed a coalition of more thank 2 million U.S. veterans through its partnerships, the largest in the nation. The majority of recipients of the crowdfunded loans, the company said, are veteran SME owners.

If March enters in like a lion, then that lion was certainly Zuora. Wednesday also ushered in the news that the cloud-based e-billing service took the lion’s share of this week’s investments with a $115 million backing. Spearheaded by Willington Management company, Blackrock Inc and Premji and Passport Capital, the latest fundraising round values Zuora at $250 million.

Part of what makes the company so attractive, reports said, is the business model Zuora CEO Tien Tzuo has been pushing onto the market for years: businesses are increasingly moving into a subscription model for procurement, meaning suppliers’ invoice and payment systems will need to adapt. As corporations catch on to this need, Zuora has nabbed major clients including software provider Box. Today, the company “sits between traditional CRM and ERP,” Tzuo said.

On The Radar

On the rumor mill, India-based B2B online marketplace Snapdeal could soon secure up to $700 million in new funding from Taiwan-based electronic manufacturer Foxconn Technology Group. Unnamed sources spoke to VC Circle, which reported the potential Snapdeal funding Wednesday. According to reports, the e-commerce site is also in discussion with China’s Alibaba, which also operates a B2B digital marketplace in India. Reports first emerged of renewed Snapdeal funding earlier this month when media said the company was in discussions with several funders, including international hedge funds, to raise hundreds of millions of dollars.

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