When it comes to fintech, consumers have gotten the most attention over the past decade, with banking, credit, investment and other legacy services getting the disruption treatment. But at the same time, there is a growing trend to build more for the B2B market, and today one of the new hopefuls in this space is announcing funding ahead of a public launch in Q4 this year.
Consistencywhich wants to build what it describes as a new kind of FinOps stack for B2B businesses — APIs and other tools to create more responsive pricing, billing and related services by using data and analytics to do so — has raised $19 million, a seed round that will use to continue developing its products and hire more talent.
Sequence is based in London, England, and the funding comes from an impressive list of investors, considering the company has yet to launch.
Andreessen Horowitz – the Silicon Valley firm that has recently become increasingly active in Europe – is leading the round, with Salesforce Ventures, Firstminute Capital, Crew Capital, Passion Capital, Dig Ventures, Fin Capital and 9Yards also participating; angels in the circle include the founders of Plaid, Intercom, Jeeves, GoCardless, Marshmallow, Lendable, Hopin, UiPath, Monzo, Comply and others not mentioned.
Reports of this seed round and a16z’s involvement actually surfaced around a year ago, with some of the attention coming not only from the famous backer, but also from the founders’ track record. Riya Grover, the CEO, previously founded Feedr, a start-up called a “cloud canteen”. sold to Compass Group; meanwhile, co-founder Eamonn Jubaoui, who is chairman, co-founded the identity verification startup Onfido. In any case, at that time the funding was still not complete and ended up with more investors and in a larger amount.
A little note on the valuation: Earlier reports pegged Sequence’s valuation at $50-60 million, but Grover said in an interview last week that the startup would not disclose its valuation. However, I would point out that there are several factors that could affect this number. The “cost of capital” has definitely risen over the past year and has put pressure on valuations in general. But on the other hand, also in the last year, Sequence launched its private beta and revealed several early adopters such as Deliveroo, Pipe, Snyk and Reachdesk.
Companies like Stripe, Paddle, and Modern Treasury have opened the door to making it easier for digital businesses—not necessarily in their core payments and invoicing companies—to use APIs to incorporate more advanced payments, invoicing, reconciliation, and other revenue-related services into its financial stack. The opportunity that Sequence is targeting is related to all of these, but it targets a more specific gap in the market.
As Grover described it to me, it’s one thing to make it easier for a company to include a payment stream in a product. What Sequence aims to do, however, is make it just as easy to build pricing and payment services that are more personalized to the customer and to a specific moment, not unlike what businesses often do with e-commerce transactions. trade.
It does this by leveraging payment and transaction data that its business customers may already have in their systems but have failed to proactively analyze and apply, through integrations with third-party applications such as Salesforce, HubSpot, Xero, NetSuite and QuickBooks. (And it focuses on two main ways businesses pay for goods and services—bank payments or debits, rather than card payments—for the payments themselves.) In that, Sequence and its investors believe the startup is an early mover in building builds payments software that enables businesses to capture real-time data and feed it into dynamic pricing and payment flows.
Additionally, Sequence is built as a “low-code” service, bypassing the need for developers to build, test, and ship changes.
“In a B2B environment, when you’re building new products and pricing plans, you want an interface that doesn’t always rely on developers,” she said. “We empower operators to empower themselves.”
The role of no-code and low-code software is often described as being more efficient or simply cutting red tape to help non-technical people get a better handle on the digital products they themselves use, but recently it has gained a more pragmatic, fiscally driven goal: At a time when companies are reassessing their spending on new products and projects and how they allocate their talent resources, services such as billing and payments are also being reviewed.
The sequence quotes figures from Idea capital who estimate that B2B businesses today spend a staggering 7% to 9% of revenue building out billing and payments infrastructure, and that includes not only the investment in software or SaaS, but also the engineers needed to implement it.
“We saw an acute pain point and therefore a compelling opportunity to automate and manage payments and financial workflows,” Seema Amble, a partner at Andreessen Horowitz, said in a statement. “The Sequence team really impressed us with both a strong team and an initial client base excited about the vision.”