BlueVine provides $ 102.5 million more for small business banking services – TechCrunch

When it comes to fintech plays, SMEs are not often the target audience: they are too small and fragmented compared to large consumer companies; and they are too demanding compared to mass market users. But as a sector, they make up over 99% of all businesses in developed countries such as the United Kingdom and the United States, which means they cannot be ignored. Today BlueVine, one of the newly launched financial services that has built a business that specifically serves SMB, is a major funding round, emphasizing the quiet opportunity and demand that is out there.

"We see a huge gap in the market, where most SMBs still use consumer account accounts," said Eyal Lifshitz, CEO and co-founder of Bluevine. "That's the mission we're on."

The startup, which offers financing and other banking services to SMB, today announces that it has raised $ 1[ads1]02.5 million, a series of F-share rounds that comes from a mix of financial and notable strategic investors.

Led by ION Crossover Partners, the round also includes existing investors Lightspeed Venture Partners, Menlo Ventures, 83North, SVB Capital, Nationwide (a major financial player in the UK), Citi Ventures, Microsoft's business fund M12, and private investors; as well as new investors MUFG Innovation Partners Co., Ltd, O.G. Tech (VC associated with Israeli billionaire and real estate magnate Eyal Ofer), Vintage Investment Partners, ION Group, Maor Investments and additional private investors.

With this latest round, Silicon Valley-based BlueVine has raised between $ 240 million and $ 250 million in equity, with another half a billion dollars in debt financing to provide fuel to its loan platform, Lifshitz said in an interview. The company never disclosed valuation, and it does not today, but he added that BlueVine "is doing pretty well," with the valuation "up" compared to its Series E.

"We are not profitable yet, but we Lifshitz said, noting that the company has now raised $ 2.5 billion in loans to 20,000 small businesses.

While SMBs are not often the first targets for fintech startups, that does not mean they are completely ignored. Others who have built large companies around these users include Kabbage – SoftBank-backed Atlanta startup that also started with loans before also spreading to a broader range of banking services (Kabbage is currently valued at over $ 1 billion by comparison.) Another recent player in SME-focused banking is Mercury, which also recently raised money, the primary goal being a narrower subset of the SME world, startups.

BlueVine's service is mainly based on financing root products, where they provide both credit and short-term loans (both up to $ 250,000) and "factoring", where customers can arrange for BlueVine to pay upfront for invoices they choose to pay, a service that translates into credit limits of up to $ 5 million and means users don't have to wait for money to come in before paying for bills. [19659004] As with Kabbage, BlueVine's move into a wider range of banking services – sold as BlueVine Business Banking, which includes checking accounts and other services alongside finance – is a newer, ever-expanding and expanding business. For example, the checking account was first announced in October this year.

For business customers, the idea is to give them a one-stop shop for all their financial services, while for BlueVine the idea is to create a more complete set of offers to keep users on the platform and to get better margins on them at across multiple services. Interestingly, this BlueVine sets up not to compete so much with start-ups – most of them still offer one-point services or a small collection of them, but with banks that still offer complete suites of services, although they are often more expensive and less efficient than startup.

" My real competitors are the 4600 banks in the United States," Lifshitz said. "It's a very long tail in the United States. But if you go into it, historically, SMEs haven't been well served by them."

The fact that the company attracts a number of financial services investors inevitably travels the question of how BlueVine can work with them long-term, or even become an acquisition target, but one thing Lifshitz said it won't do is white-label services (something Kabbage has explored): "We won't give away our technology , "he said." We are focused on leveraging our technology to be the best in class. "

" BlueVine has demonstrated a success with multiple financing products and set out with its vision of a complete platform for innovative banking products for small businesses, "Jonathan Kolodny, partner of ION Crossover Partners, said in a statement. "We have been following the company closely since the early days, and have witnessed the demand and frankly the financial need for BlueVine's banking services. We believe the company is exceptionally well positioned, thanks to world-class leadership, to change the way small businesses manage their financial needs today and in the future. "

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