Best Tech News Site: Growfin’s AI-based cash collection SaaS expands further to US and Asia

Monday, March 6, 2023

Growfin’s AI-based cash collection SaaS expands further to US and Asia

Cash management — tracking who needs to pay an invoice and whether it’s been done — can make or break a business. Now, a startup building SaaS software to help finance departments manage this more intelligently is announcing some funding to expand after seeing strong demand.

Growfin, a Singapore- and San Francisco–based fintech startup that provides SaaS for finance departments to track and collect payments and to help manage the accounts receivable process, has raised a $7.5 million Series A. The company plans to use this funding to continue expanding in the U.S. and Asia, and to double down on building more AI-based technology to expand its platform. Next up: a forecasting tool that predicts trends “based on past payment behavior and current receivables data through Growfin.”

Singapore’s SWC Global led the funding round with participation from existing backers 3one4 Capital and angel investors. The startup touts that the latest funding comes on the back of 8x growth in customer numbers over the last 12 months, during which Growfin has helped clients collect more than $1 billion in account receivables (AR). Growfin has now raised $9 million in total, and it’s not disclosing its valuation.

Growfin is tapping into a ripe market, not least because of the current economic climate and the pressures that it is putting on businesses of all sizes.

A recent report from Gartner found that 78% of CFOs have invested in automation and cash flow visibility technology. But while they are increasingly willing to pay for tools to help them plan for the future, when it comes to current accounts, many still rely on spreadsheets, exposing a gulf between having visibility of a company’s current financial state and knowing how that links up with what it might look like in a week, month or year.

Growfin’s initial product was an AI-powered finance CRM, which finance, sales and customer success teams could use to connect in one place to handle customer relationships during payment and cash-collecting processes, a clever bridging product that speaks to how the pull of accounts receivable departments might sometimes do better if they could join forces and knowledge with those who manage the majority of the customer relationship prior to that point. (And indeed, a smoother experience could lead to more sales in the future.)

Instead of building an AR automation product, the company made a finance CRM that not only automates finance accounts receivable workflows but also provides the right collaboration capabilities and real-time visibility to sales, customer success and customers themselves in one place (where they all see the same information).

That first push into more finance visibility caught on. Growfin’s primary users currently scale B2B tech companies in SaaS, adtech, logistics tech, and edtech, and it now has 25 customers, including Intercom, Fourkites, Mindtickle, LeadSquared, and Quick Dry Restoration, co-founder and CEO of Growfin, Aravind Gopalan, told TechCrunch. It sells primarily to clients who are finance teams, although as you might guess, revenue-generating teams like sales and customer success are also users of its service. The startup says it is now at $400,000 in annual recurring revenue since its launch 12 months ago.

: Image Credits: Growfin founders (L to R) Aravind Gopalan and Raja Jayaraman

Intercom uses Growfin to automate and track its collection activities, integrating with NetSuite, Zuora and Salesforce and giving real-time visibility to finance leaders, Gopalan explained. “We helped them reduce their cash collection cycle from 91 days to 59 days in a span of 5 months, improving collection efficiency by 35%,” he said.

Locus, a logistics tech startup that uses Growfin to resolve invoice disputes to collect payments faster, claims it’s improved the productivity of their teams by 60% in ten months, Gopalan said.

Founded in 2021 by Gopalan and Raja Jayaram, the co-founders told TechCrunch they held meetings with more than 200 finance leaders worldwide when the product was still being developed to get more insights into the problems they typically face. The resounding message was that finance teams were unsatisfied with legacy systems that were based around spreadsheets and the expensive prospect of simply hiring more people as a solution to the time-consuming workload.

“Managing receivables and collecting payments are often complex and compound even more as companies grow. Despite the growth of ERPs and CRMs such as Salesforce and Netsuite, I’ve understood that 90% of finance teams still manage their AR (account receivables) processes outside these tools, typically on spreadsheets or in-house databases,” said Gopalan. “This collaboration-first approach will offer better efficiencies and greater transparency and build trusted relationships between customers and businesses towards collecting B2B payments faster.”

It employs 40 people and plans to double its headcount this year in the U.S., where most of its clients are based, as well as in Asia.

Growfin’s competitors include HighRadius, Upflow, Tesorio, YayPay and Gaviti. ERP service providers are an indirect rival, Gopalan said.

Upflow raises $15 million to manage your outstanding invoices

“Growfin’s AI-powered system is poised to disrupt how businesses collect their invoice payments by sitting on top of ERP systems like Netsuite and Microsoft dynamics that dominate the industry,” says Tuck Lye Koh, founding partner of SWC Global. “Globally, they have over 100,000 customers, and now finance teams beholden to these systems will be able to plug in Growfin to get a deeper and wider eye into their financial well-being with real-time cash-flow efficiency and forecasting.”