Commercial payments technology firm WEX landed a $400 million investment this week, but when it comes to venture capital, investors set their sights on B2B eCommerce, small business funding, payroll and more. With a combined $43.3 million in VC funding for the sector, B2B FinTechs may be showing signs of a mid-year lull. PYMNTS breaks down the companies that did manage to secure funding, below.
Artificial intelligence (AI) platform Pactum, which offers a B2B solution for corporates to automate and optimize commercial negotiations and contract management, secured a $3 million seed funding round led by Germany's Project A, while DocuSign and previous backers also participated. Pactum did not disclose in its announcement how it plans to use the investment, but highlighted the opportunity for corporates to strengthen their supplier relationships through enhanced negotiating technology powered by AI.
"We're convinced that AI-based systems will shape the future of commercial negotiations," said Project A General Partner Uwe Horstmann in a statement.
Human resources startup Worky secured $3 million in new funding led by QED Investors and with participation from LEAP Global Partners, according to reports in Contxto. The company, based in Mexico, will deploy the seed funding to bolster its technology and product teams, the company told the publication. And while the firm has been targeting small and medium-sized businesses (SMBs), Worky is reportedly looking to expand to companies with more than 200 employees as well, and will continue to prioritize data and support for remote workers as it grows.
Two former executives from payments technology conglomerate Square have formed a new B2B FinTech in Australia called Zeller. The company is targeting small businesses with banking solutions in an effort to provide entrepreneurs with greater choice and promote innovation in the arena. Supporting that initiative is Square Peg Capital, which led a $6.3 million seed investment in the firm, which will be used to help Zeller gear up for its official launch. In an interview with Smart Company, the firm's co-founder Ben Pfisterer said the company wants "to make sure that disconnect between earning money and spending money is minimized" for SMBs, though clarified that Zeller will not operate as an actual bank. The company is looking to debut on the market in the first quarter of 2021.
Norwest Venture Partners has led a $10 million Series A investment in Spiff, a U.S.-based platform that automates commissions payout calculations for corporates and their sales associates. The company announced that the funding, which also saw participation from new investors NextWorld Capital and Epic Ventures, as well as from returning backers, will be used on customer acquisition and market expansion. In a statement, Founder and CEO Jeron Paul noted that the current market uncertainty is forcing businesses to introduce new incentives for employees to ink deals.
"Commissions are a major cause of anxiety for teams who don't understand or trust their incentive plan, and many waste hours every month correcting mistakes or arguing with finance, which hits bottom lines," he said.
In the largest venture capital round for a B2B FinTech startup this week, India's Zetwerk raised $21 million for its B2B eCommerce platform built for the manufacturing industry. Greenoaks led the Series C round, while existing backers Accel, Kae Capital, Lightspeed and Sequoia Capital India also provided backing, TechCrunch reported. Targeting manufacturing companies large and small to original equipment manufacturers (OEMs) and engineering procurement construction (EPC) firms, ZetWerk specializes in custom products that aren't easily found on other eCommerce platforms.
As organizations look to diversify their supply chains, Zetwerk told the publication that collaboration will be critical to promoting trade and economic growth within India itself. The firm plans to use the investment to scale operations across the country and help India businesses connect to partners across borders.
Commercial payments technology WEX announced a $400 million investment from a Warburg Pincus LLC affiliate, which includes $310 million of convertible notes and $90 million in common stock through a private placement. The investment coincides with an amended credit agreement with its existing credit facilities, the company noted, explaining that it would provide the firm with increased financial flexibility as it looks to focus on growth through the pandemic.
"We are pleased to further fortify our balance sheet during the current uncertain operating environment while reaffirming our relationship with Warburg Pincus, who has demonstrated their strong commitment to the future growth of WEX," the firm's Chair and Chief Executive Officer Melissa Smith said in a statement.