Pleo, the Danish fintech that offers a “business spending platform” that lets companies easily issue employees with cards and manage expenditure, has raised a hefty $56 million in Series B funding.
Leading the round is Stripes, the New York-based growth fund, with participation from existing investors, Kinnevik, Creandum and Founders. I understand that the new funding values the company at a little under half a billion dollars and brings the total amount raised to $79 million.
Founded in 2015 by ex-Tradeshift early employees Jeppe Rindom and Niccolo Perra, Pleo aims to transform business expense processes so that employees aren’t left out of pocket waiting to be reimbursed or have to jump through too many bureaucratic hoops trying to make company purchases. The platform consists of “smart” company cards paired with software and mobile apps to automatically match receipts and track company spending in real-time.
The Pleo MasterCard is a prepaid card that can be charged up and handed out to employees, either physically or virtually. This is then coupled with Pleo’s backend system and apps. Features of the software includes the ability to categorise spending automatically and capture receipts associated with each transaction.
Pleo also eliminates expense reports and automates bookkeeping tasks via integrating directly with various accounting software providers. Meanwhile, the prepaid element means no waiting to be reimbursed for expenses and less waiting for approval, which is traditionally a real pain-point for employees and companies alike.
In a call, Pleo co-founder and CEO Jeppe Rindom tells me that the fast-growing startup is helping to create a whole new product category: Pleo is neither a business bank account or simply accounting or expenses management software. Instead, the company’s “business spending platform” has elements of both but is as much about enabling and embracing a change in company culture than simply better financial technology.
“We are helping to export Nordic company culture,” he says, in reference to a more flat company hierarchy where employees are empowered to take more responsibility and have greater autonomy. The Pleo platform’s features and the transparency it affords means that more employees can be given company cards underpinned by micro-budgets and spending limits for the things they need to purchase in order to get on with the job.
Likewise, Rindom says that forward thinking companies are also recognising that bestowing more trust with employees and less pain-points with regards to expense reimbursement is also a potential recruiting and retention tool. He says that while a company’s chief financial officer is typically the buyer of Pleo, the product itself is targeting employees, who remain its biggest advocate.
To that end, more than 3,500 companies have switched to Pleo across the U.K., Denmark, Germany and Sweden. Its customers include Airsorted, The Tab, Lyst, Yoyo, Pizza Pilgrims and Roskilde Festival amongst others, with “hundreds” of businesses joining Pleo every month.
Pleo says it will use the new funding to expand and more than triple its headcount, from 120 to 400 employees by the end of 2020. It also plans to accelerate product development with the aim to service “the entire purchase process” for SMEs across the whole of Europe. This will include adding credit, invoices, mobile payments, a vendor marketplace, VAT reclaims and more.
“While we are competing with banks in this one area we are not aiming to become one,” adds Rindom in a statement. “We remain committed to providing the best product in the market for business spending. We haven’t touched the funds from our Series A round less than a year ago, yet we see enormous potential and demand for Pleo”.