Israeli-founded, US-based financial tech company Fundbox secured another $20 million investment this week for its Series C funding round from MUFG Innovation Partners, the corporate VC arm of Mitsubishi UFJ Financial Group, Japan’s biggest financial and bank holding company.
Fundbox initially raised $176 million in Series C funding in September with a number of investors including MUFG Innovation Partners. The fresh equity investment brings the round to nearly $200 million.
Fundbox offers small-business owners data-driven loans to solve cash flow issues. It advances payment for thousands of unpaid invoices weekly, effectively eliminating the 30-, 60-, and 90-day problem faced by many small businesses. The company was founded in 2013 by fintech veterans Eyal Shinar, Tomer Michaeli, and Yuval Ariav, and is based in California.
During the COVID-19 pandemic, Fundbox joined the PayToday movement alongside other US-based fintech companies, encouraging enterprises and governments to pay their small business clients quickly so they can stay afloat and survive the lockdown.
Small businesses have been hard-hit since the pandemic started and local authorities issued orders to shelter-in-place across states. According to a recent survey by Womply, a marketing and CRM software company for small businesses, revenue for small businesses declined dramatically since March and 1 in 5 businesses said they would not survive 30 days if sales stopped. The research was cited in a press release by Fundbox in late April.
Since the global health crisis reached the US, Fundbox said it started paying its small business vendors every week, instead of every two weeks, and promised to continue aiming to do so until the crisis ends.
Akihiko Okamoto, managing director and CIO at MUFG Innovation Partners was cited by CrowdFund Insider as saying: “We are pleased with how Fundbox’s advanced data science and technology capabilities have contributed to its superior portfolio performance, especially during COVID-19.”
“Even in the face of these extraordinary economic conditions, the strength of the business has been impressive. Our team has great confidence in Fundbox,” he added.
Shinar, co-founder and CEO at Fundbox, noted: “Our investments in real-time data access, machine learning, and automated credit management have helped us respond very quickly to this crisis, allowing us to continue serving the majority of our customers in addition to adding new customers.”