ScaleFactor, an intelligent finance and automated accounting platform, today announced a $30 million Series B round of funding led by Bessemer Venture Partners, one of the most successful cloud venture capital firms in the industry. Fresh off the heels of their Series A in July 2018, ScaleFactor has raised $40 million in less than six months. Returning investors in the round include Canaan, Broadhaven Ventures, Firebrand Ventures and multiple prominent angel investors.
ScaleFactor empowers small business owners by consolidating and automating complex back-office operations into one platform to create an intuitive business OS. The new capital will fuel additional features and headcount in the companys Austin headquarters and enable them to expand nationwide.
Businesses get overwhelmed by administrative work jumping from siloed solution to siloed solution and should be able to focus on what makes them successful, said Kurt Rathmann, CEO and Founder of ScaleFactor. Our vision of a comprehensive business operating system, built with their needs in mind, allows our customers to be proactive with their business, operate in control and drive success.
The Race to Intelligent Finance
There are 19 million companies in the U.S. with under 100 employees, all of which need to keep track of finances. Unfortunately, most of them are currently forced to handle these tasks manually, a painful and time-consuming process. Theyre stuck between an Excel spreadsheet and software that can cost over $100,000. ScaleFactor is on a mission to help small businesses scale faster. By automating complex accounting tasks and translating financial information into usable business insights, ScaleFactor is enabling business owners, managers and entrepreneurs to be proactive and focus on what they love running and growing their business.
The market for how companies manage their financial operations has evolved quickly, said Byron Deeter, Partner, Bessemer Venture Partners. With Kurts roots as a CPA, he identified this problem early and guided ScaleFactor to be the leader in intelligent finance. We are excited to support their mission and growth.
ScaleFactor realized over 700% annual customer growth in 2018. At a time when small and midmarket companies are often overlooked, ScaleFactors momentum is built off of a unique understanding of their needs. Since launch, the company has used these insights to build the business operating system (OS) for small and midmarket businesses. Its a solution to the piecemeal approach companies currently use to solve the various accounting and back-office choirs. Current offerings include Automated Bookkeeping, Bill Pay and Invoicing, Cash Vision and Business Insights.
ScaleFactor has assembled an optimal combination of technology and team, said Anna Khan, VP, Bessemer Venture Partners. ScaleFactor has grown at hyper-speed since its inception, and we are firm believers that AI-based accounting and (a streamlined) back office is the path forward for the majority of small businesses.
New Key Executive Hires
ScaleFactor welcomes Francis Sullivan as its new CTO. Sullivan brings over 30 years of industry experience to this new position. Sullivan is a co-founder of Austin-based Spiceworks and spent the last 13 years there redefining the SMB IT industry. At ScaleFactor, Sullivan will build out its robust software platform with enhanced features to empower SMBs to tackle complex back-office operations.
Robert Gilbreath joins as Senior VP of Marketing, bringing a depth of marketing and partnership knowledge. Robert was previously CMO and VP of Partnerships at Austin-based Shipstation. Roberts marketing knowledge, entrepreneurial spirit, and prior startup experience will be instrumental as ScaleFactor continues to build out business OS.
Eric Steinhoff brings an impressive wealth of knowledge surrounding lending that will amplify ScaleFactors ability to connect small businesses to the best source of capital when they need it. Eric started his career at Capital One and was most recently Chief Compliance Officer at Apple Pie Capital.
Additional Thoughts From Existing Investors
The prospect of a clean, singular interface for businesses to manage the back office is now a reality with ScaleFactor, said Michael Gilroy, Partner, Canaan. Kurt has positioned ScaleFactor to win with small and mid-sized businesses as they further develop their platform and positively impact the success rate of small businesses in the U.S. and beyond. We are excited to be a strategic partner for the long run.
Technology is fundamentally changing the accounting realm, said Michael Sidgmore, Partner, Broadhaven Ventures. ScaleFactor brings automation to back-office tasks which gives business the ability to execute in real-time with access to instant information. Our team has witnessed the pace of ScaleFactors growth and we are eager to support them in the next phases of their journey to serve businesses.
About Bessemer Venture Partners
Bessemer Venture Partners is the world’s most experienced early-stage venture capital firm. With a portfolio of more than 200 companies, Bessemer helps visionary entrepreneurs lay strong foundations to create companies that matter, and supports them through every stage of their growth. The firm has backed more than 120 IPOs, including Shopify, Yelp, LinkedIn, Skype, LifeLock, Twilio, SendGrid, DocuSign, Wix, and MindBody. Bessemer’s 14 partners operate from offices in Silicon Valley, San Francisco, New York City, Boston, Israel, and India.
ScaleFactor is on a mission to help small businesses scale faster. By automating complex accounting tasks and translating financial information into usable business insights, ScaleFactor is enabling business owners, managers, and entrepreneurs to focus on what they love running and growing their business. Find out more about how ScaleFactor is solving the problems that businesses face every day at scalefactor.com.