There’s talk that alternative finance is dead. Well, in the U.S., that may be true. Not one of the four alternative lending startups that secured investments this week were from the U.S. Instead, more than $40 million landed in South Africa, India, Canada and the U.K.
That’s not to say the U.S. B2B FinTech space is silent. In fact, the largest funding round of the week went to one of its players. Find out who it is in our VC investment roundup below.
Late last week, South Africa’s LulaLend brought some rare attention to the nation’s alternative lending space. The company didn’t reveal how much it raised in its latest funding round, but said Accion Venture Lab led the funding. With a focus on providing working capital to local SMEs, LulaLend said it will use the funds to expand its team and further develop its solution, which focuses on transparency and speed in the application, lending and repayment process.
“LulaLend aims to address this credit gap in South Africa,” said Accion CEO and President Michael Schlein, “and has the potential to serve the entire region, helping small business owners access funding, build credit histories and participate in the global economy.”
Also late last week, India’s FlexiLoans announced its own funding round of $15 million from a range of backers, including KKR India Chief Executive Sanjay Nayar and former Citibank Head of Operations and Technology Vikram Sud, reports said. FlexiLoans offers an online lending platform for small businesses and launched in Nov. 2015. Less than a year later, the company has inked partnerships with nearly two-dozen online marketplaces in India, like Flipkart; reports said more than 2 million SMEs have used FlexiLoans’ services.
As part of its latest funding round, nonbanking finance firm EpiMoney has also acquired a stake in FlexiLoans. The company said it will use its latest support from angel investors to focus on further developing its technology and propel marketing efforts.
In the biggest alt-lending funding round of the week, Canada’s FundThrough reported raising $18.6 million from Scale Up Ventures, marking the fund’s fourth-ever investment. Investors cited FundThrough’s high customer satisfaction rating and the fact that 85 percent of its SME users are repeat clients, the company said. The Series B funding round will be used to fund SME loans through FundThrough, and a portion of the funds raised will go to the company as equity, reports said on Monday (Oct. 10).
Sonovate, which provides finance and back-office technology to the contract recruitment space, raised $11 million in a Series B funding round led by Global Founders Capital, according to reports released on Wednesday (Oct. 12). With the new funds, Sonovate said it will focus on international expansion across Europe and North America after quadrupling its staff levels in the past year.
According to the company, traditional financing and some other alternative finance options aren’t catered to the recruitment space. Daniel Jones, partner at Global Founders Capital, said Sonovate has “made a huge impact on the recruitment sector in the U.K.” On top of the venture capital, Sonovate also announced $6.13 million raised in debt financing.
There’s no doubt about it: Alternative lending had a stellar week. But the biggest financing round for B2B FinTech startups went to Nexus, a procure-to-pay company that raised $28 million from Mainsail Partners, reports said on Wednesday. Nexus said the money will be used to focus on product development, sales, marketing and the expansion of its onboarding and client services teams.
“The time was right for our company to take advantage of the many opportunities that are available with proper funding,” the firm’s CEO, Tom Coolidge, said in a statement. “As more companies look to automate and tightly manage the process from procurement to payment, the demand for our software has increased.”