ScaleFactor Inc., an automated accounting and finance platform for the bookkeeping SMB market, announced it raised $60 million in Series C funding led by Coatue Management LLC.The Austin, Texas-based fintech provides a series of online and mobile applications to help businesses manage back-office finances … Rathmann says the pandemic wiped out almost half of ScaleFactor’s sales; the startup had reached $7 million in annual recurring revenue at the end of 2019. But the company appears to have been on rocky ground even before the pandemic. After raising capital last year, ScaleFactor hired dozens of customer service representatives to improve customer relations, only to lay off 40 of them in February as the company’s bottom line suffered. Rathmann acknowledges the decision may have affected his business once the pandemic hit, as customers demanded more human relationships, rather than automated services. Ahead of yet another funding round, multiple venture capital firms passed on investing, according to people familiar with their decisions, having determined that ScaleFactor was more of a services business than a software platform.
We do not have the information about the paid up capital of Scalefactor. Our systems are trying to find it, we will update it as soon as we have it. It also provides the basic information of profit, loss, expenses incurred by Scalefactor. This is a brief summary, the actual information may vary on the recent filings done by the Scalefactor company to the government.
In the real estate sector, venture backed office-space providers Convene and Knotel have laid off hundreds of workers. In travel, TripActions, a corporate travel management software startup that lost 95% of its business as a result of the pandemic, recently secured $125 million to keep the company afloat. ScaleFactor, an Austin, Texas-based intelligent finance and automated accounting platform, raised $60m in Series C funding.The round was led by Coatue Management, with participation from returning investors Bessemer Venture Partners, Canaan, Broadhaven Ventures, and Firebrand Ventures as well … ScaleFactor’s closure is yet another symptom of the pandemic’s varying effect on venture-backed startups. Some technology firms that enable remote workforces to thrive — such as workflow software startup Notion or cloud-based design company Figma — have seen their valuations soar far north of $1 billion. By the end of last year, software startup ScaleFactor had emerged as a buzzy financial services company, raising $100 million in 12 months from big-name investors including Bessemer Venture Partners and Coatue Management.
Even as doubts about its product emerged, ScaleFactor scored a term sheet for a $60 million funding round at the start of June 2019. Coatue Management, a large technology investor overseeing $16 billion in assets, led the new funding round, joined by Bessemer, Canaan and others. “With our foundation established, a big part of our Series A is how do we power the business owner past bookkeeping & accounting? We see many opportunities to help further and our next steps will include things like lending, payments and many other activities that take a business owner/operators focus away from driving their business forward,” Rathmann wrote in an email. After graduating from TechStars’ Austin accelerator, the company was able to nab $2.5 million in a seed financing round that included TechStars Ventures, NextCoast Ventures, and two Kansas City-based investment firms — Firebrand Ventures and Flyover Capital. Rathmann, a https://www.bookstime.com/ former KPMG employee, started ScaleFactor after seeing the lack of innovation in the backoffice functions that are really the engine of any small business.
Covid-19 swept the United States the following month, and existing customers weren’t buying in; Robert and Cornelia Stang balked after being told their contract would jump from $500-a-month to $1,700. In the spring, investors discussed ScaleFactor’s future before deciding to shutter operations, according to a person with knowledge of the discussions. Founded by longtime accountant, Kurt Rathmann, the Austin-based company has created a software service that collects and analyzes data from point of sale systems, bank accounts, credit cards and scalefactor billing systems, to automate recordkeeping and payroll functions. While Square has moved into lending services (and now is on the hunt for a banking license) through its window into a company’s revenues through point-of-sale devices, a company like ScaleFactor has a more holistic view of the health of a business, says Gilroy.