Supply chain fintech Tradeshift raked in a $200 million funding round on Thursday of combined debt and equity from a mix of existing and new investors. Participation in the round included Koch industries – a massive US industrial conglomerate – as well as IDC Ventures, LUN Partners, Private Shares, and Fuel Capital.
Tradeshift’s cloud-based platform enables tech products for the B2B marketplace with options like e-invoicing, accounts payable automation and access to supplier financing. With new funding in the vault, the late-stage startup said it will use the capital to scale the company’s growth and balance sheet, though did not disclose in which departments.
“Tradeshift’s combined SaaS and embedded financial services offering is well-positioned at the forefront of what we see as the next wave of digital transformation. Further, it is clear that digital networks are the future of B2B software, just look at Slack, LinkedIn, and Github to see the trend,” said Jeff Randsell, Managing Director and Founding Partner at Fuel Venture Capital Partners.
Randsell said Fuel looks to invest in companies they believe are “category winners.” Tradeshift recently reported that the cumulative value of transactions processed across its network had passed the $1 trillion mark, having doubled in two years. Annual charge volumes on Tradeshift Go are predicted to exceed $2.5bn in 2021, a 600% year on year rise.
However, these numbers may not come as a shock given the strain supply chains have faced since the onset of the pandemic. From April to June 2020, Amazon sold 57% more items than it had a year earlier as consumers shifted to online shopping.
Chip giant Intel, which has been at the center of the global semiconductor shortage, expects supply-chain issues to last through 2023, partly because it takes three years to build a new factory, the Wall Street Journal reported.
“Embedding financial services directly into our product unclogs the flow of working capital across supply chains, eliminating a significant pressure point in the buyer-suppliers relationship,” said Christian Lanng, CEO and co-founder, Tradeshift.
“As one of the first companies to recognize the potential for embedded finance in SaaS, we have been betting on the convergence of Fintech and SaaS products for a while. We’ve built the technology and distribution channels to capitalize on what is now one of the defining trends in our industry.”