When it came to B2B investments in the last seven days, the name of the game was certainly “quality,” not quantity. Venture capitalists struck only a few deals, but B2B saw its newest unicorn, and VC funds nabbed millions, hinting at a new wave of investments in the enterprise startup space coming soon. Don’t be fooled by a low number of investments – B2B startups are catching a lot of attention.
The biggest news of the week was undoubtedly Coupa’s reported more-than-$1 billion valuation, revealed Monday (June 1). The procurement and treasury management service provider announced $80 million in new financing from an array of investors, including Premji Invest, Iconiq Capital and T. Rowe Price Associates. The fundraising brings the total amount of backing acquired by Coupa to $167.5 million.
The funding means big news for the B2B software and cloud services industry. As the sector’s newest unicorn, Coupa represents the spiking interest in SaaS startups as businesses begin to catch on to its benefits.
“This financing allows Coupa to continue investing our go-to-market capacity and further expand our market-leading product portfolio and cloud innovations,” said the company’s CEO Rob Bernshteyn in a statement. “With our cloud spend management solutions we are redefining the value software should deliver to businesses and changing how customers define success from enterprise software solutions.”
On Tuesday (June 2), Big Data service provider Saama Technologies announced it is stepping out of stealth mode fresh off of a $35 million funding round. The company’s founder, Suresh Katta, envisioned the concept of aggregating, storing and analyzing Big Data for enterprise use way back in 1997. Nearly two decades later, Saama has found financial backing from Carrick Capital Partners and already services some of the world’s largest businesses like Delta Dental and Cisco Systems.
Big Data scored another investment win this week in the form of the merger between Mojix and Tier Connect. Reports said Thursday (June 4) that Mojix’s wireless sensor network solutions will combine with TierConnect’s Internet of Things platform to fuel IoT technology solutions.
According to Mojix President and CEO Ramin Sadr, PhD, a tie-up with TierConnect means pulling the companies up into a new level in the IoT competitive landscape. “With the addition of [TierConnect’s] next-generation software platform, Mojix is best positioned to further strengthen its role as a leading IoT solutions provider,” he said in a statement. “In addition, the TierConnect team gives Mojix deep expertise in Big Data scalability, highly-configurable application frameworks, and elegant user interfaces, all key ingredients in collecting, analyzing, and displaying mission-critical contextual data for our customers.”
The firms, however, did not disclose the price tag on the deal.
Don’t be fooled by the few number of investments in the last few days. Venture capitalists are stockpiling their cash, and experts are highlighting trends around the globe that anticipate ongoing waves of financial support in the B2B startup sector.
In the U.S., venture capital fund Rittenhouse Ventures secured a $750,000 investment from Robin Hood Ventures, reports said Tuesday (June 2), a move that will almost certainly increase Rittenhouse’s backing of enterprise-focused innovators. The fund focuses investments of between $500,000 and $750,000 in B2B companies that services the human resources, healthcare and financial industries, reports said. While The fund declined to elaborate on the new funding due to SEC regulations, reports added that while angel groups are not often the source of financing for venture capital funds, Rittenhouse and Robin Hood have partnered on investments before.
Additionally, reports from the World Economic Forum published Sunday (May 31) revealed that Wamda Capital’s plans to raise a $75 million fund to back B2B technology startups in the Middle East are moving forward thanks to Zain Group, which participated in the fund raising. Reports did not indicate just how much Zain Group contributed to the Wamda Capital fund, but according to Zain Chief Strategy and Business Development Officer Emre Gurkan, the backing is part of recent efforts from the company to enter into the enterprise venture capital market. “Our goal is to capitalize on the most premising B2B and digital ideas that can bring synergies to Zain and which can impact operations or revenues in Zain’score business,” he said in a statement. “This includes unique and life-empowering digital products and services to Zain’s individual and corporate customers.”
For Wamda Chairman and Managing Partner, the firm’s new venture capital fund represents the strong support and confidence in Middle Eastern startups. “Seed money serves as acatalyst as evidenced by some of the success stories of those companies that were able to access capital in the Arab world, and environment that has traditionally shied away from supporting SMEs,” he noted. “We believe MENA could product the next Silicon Valley if entrepreneurs are given the right support to help them grow and expand.”
This past week, reports also came out that highlighted India’s booming small business merger and acquisition activity. According to reports, the nation has seen $2.27 billion worth of M&A deals in just the last four years, with B2B Software-as-a-Service and eCommerce startups leading the pack. Inbound B2B SaaS M&A accounted for more than half of these deals, while domestic eCommerce mergers made up 60 percent, reports said, highlighting Flipkart and Snapdeal’s massive valuations in 2014.
Looking ahead, experts said this B2B M&A hype will only increase, and insiders predicted new investments in Internet of Things SMEs as well. “Volumes and value will continue to rise rapidly,” researchers said. “In business-to-business software, cross-border M&A will continue to dominate transaction volumes and value.”
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