Less than two years after his departure, the Bulgarian Startup Fintech Payhawk takes up one of the largest seeds of seeds that the region has seen. The Youth Expenditure Management Company collects 3 million euros, led by the high level VC Earlybird, and goes to Germany as the next target market.
“We were impressed by the Fort DNA produced by the founding team and their relentless concentration on the customer experience. Payhawk has an excellent market potential because each company needs a solution like this, ”comments the Roland Manger Deal, co-founder and partner at Earlybird. “They decided to combine the best of what exists today and to integrate it into a new generation platform with excellent customer experience without forcing companies to change bank,” he adds.
In a word, the payhawk founded in 2018 fills the gap between corporate cards and spending management by providing a product that works above existing banks. The software allows financial directors, business owners and accountants to easily manage the entire life cycle of expenses, including real -time reports and define spending policies.
First big step: Germany
With new financing, the company aims to expand in Europe, Germany being the first target and will invest strongly in marketing and team growth. With a current team of 18 people, the startup expects to overtake over the next two years. Payhawk has just opened his office in Berlin, hired a country director for Germany and also recruits it.
“Germany is a good market because last year, a regulation entered into force, which allows companies to use certified software to scan receipts and use them for spending and accounting management without having to store the newspaper,” explains Hristo Borisov, co-founder and CEO Payhawk. The country’s advanced financial infrastructure allows Payhawk to connect to more than 3000 banks using PSD2, the European Union payment services. In addition, new regulations in Germany allow companies to store paper receipts in digital archives compatible with tax with Payhawk, reads the official version. Spain will probably be the next market after Germany. The company already has customers in the country in southern Europe.
Market size is difficult to estimate, explains the CEO. According to him, however, he has the potential to grow at least five times, because companies like Payhawk facilitate spending management and allow companies to issue and manage easier expenses. “Products like ours are a catalyst. We have seen companies that have published more than five-six cards because all management becomes easier, “he said.
For 2020, Payhawk set the goal of positioning the brand as one of the best European players for spending management.
Not just the next Neobank
The business vision is to become “the largest bank in the world without holding a single penny”. This, however, does not mean that Payhawk must be perceived as a neobank. “We remain a software company that fits into banks,” explains management. Payhawk authorizes the emission of digital and physical debit cards for employees. The manager decides on the budget that each employee could spend, sets an account and limits and could monitor expenses in real time. Employees can take photos and download invoices in the system so that accounts can also do their job. Part of the financing will be used for subsequent development development, and the company aims to add more business -oriented features, for example for the management of expenditure policies, demand and approval processes and monitoring of mileage. “Unlike many competitors, our software also allows cash expenditure management,” adds Borisov.
About a year ago and the first month on the market, Payhawk managed to attract 11 paid customers. At the time, the startup mainly aimed at SMEs in the technological sector. To date, the company has customers from 14 European countries and around 1000 people using its system. Although Payhawk prefers not to share the number of customers, Borisov says that the system is generally used by medium -sized companies in which at least five people must have corporate cards. As a general rule, Payhawk’s product is used by employees and managers who travel frequently, work remotely, must make expenses related to specific projects, must follow marketing budgets and advertising campaigns and must allocate budgets related to office management purposes. Among the customers of the company, we find the Fintech Scaleup software group, the Crypto Nexo loan startup, the international company BPO Telus.
Payhawk invoice monthly costs by the user. The standard price varies between 10 and 15 € depending on the features used, there are also personalized offers for larger customers with additional needs.
A tour of 3 million euros
In addition to Earlybird, the company attracted Mark Antipof, who spends 17 years as a commercial director at Visa Europe, and Keith Robinson, the Sage Group’s strategy director, the second largest technological company in the United Kingdom.
Infobox
Earlybird is a VC founded in 1997, which invests in all the growth and development phases of a company. Earlybird manages distinct funds focused on digital technologies in Eastern and Western Europe as well as on health care across Europe. With more than € 1 B € under management, seven IPOs on the stock market and 24 commercial sales, Earlybird is one of the most prosperous venture capital companies in Europe.
La Ronde is joined by all previous investors, including Eleven Ventures, Business Angles – Vassil Terziev, Svetozar Georgiev, Perry Blacher – Fintech advisor from Google and Senior Digital Advisor to Barclays UK, Mark Ransford Vassilev. The company’s assessment remains unknown and is also difficult to estimate, because the investment is made in the British entity of Payhawk.
The fund collection process took around six months and the company spoke about 40 VC, with whom they have already had a contact. After evaluating several mandate sheets, Payhawk decided to go with Earlybird.
“We realized very quickly that what we really needed was a high level VC to accelerate our growth, so Earlybird was an obvious choice. We are also very happy that Mark Antipof and Keith Robinson join. All these people have been visionaries who have been working with financial technologies for a long time, and it is a great validation, ”says Borisov. According to him, the market is “enormous, as well as opportunities”, and to be able to move quickly and ensure a market share in Europe, the company needed both financial, but also strategic.
With this new round, Payhawk funding has around 3.65 million euros. In its early days, the company was supported by Vassil Terziev and Svetozar Georgiev. In February 2019, a pre-grip round of € 500,000 supported by eleven companies and eight business angels was also closed.
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