Finaloop raises $35 million Series A for e-commerce accounting platform
Finaloop raises $35 million Series A for e-commerce accounting platform
The Israeli startup’s platform makes all financial data accessible to e-commerce stakeholders, from periodic accounting to real-time finance metrics
Finaloop, which develops an accounting platform for e-commerce companies, raised $35 million in a Series A funding round. The round was led by Lightspeed Venture Partners, with participation from Vesey Ventures, Commerce Ventures, and existing investors, Accel and Aleph. This brings the total investment in the company since its inception to $55 million. The latest funding round was conducted at a significantly higher valuation than the previous one, and all of the funds went into the company’s account
According to the company's CEO and founder, Lioran Pinchevski, the increase in valuation and successful funding round can be attributed to a fourfold growth in the number of customers and a sevenfold increase in revenue. "We process 70 million transactions. The company's business model is subscription-based, with fees ranging from $1,000 to $30,000, depending on the size of the customer. Our largest customer generates $100 million in sales. We serve very small businesses up to $100 million in sales, but we do not cater to corporations."
Finaloop provides an accounting solution tailored to the unique needs of e-commerce companies in the U.S. The platform makes all financial data accessible to e-commerce stakeholders, from periodic accounting to real-time finance metrics. Its real-time, AI-driven accounting service is tailored for direct-to-consumer (DTC) brands selling on Shopify, Amazon, Walmart, and many other online stores and marketplaces, as well as wholesale and multi-channel businesses.
The company was founded in 2020 by Pinchevski, a former partner at PwC specializing in American and international taxation, and a lecturer in these fields at Tel Aviv University. Lioran encountered the technological gap in accounting when he founded his own e-commerce brand, leading to incorrect pricing decisions and difficulty in producing reliable financial reports.
Finaloop currently serves thousands of e-commerce brands, managing an aggregate sales volume of $13 billion. Some of their notable clients include Heart & Soil, Duradry, Magic Brand, Crossnet, and Marcella New York. The company employs 65 people, most of whom are based in Tel Aviv, with the remainder in New York.
"I founded the company in 2020. In my last position before starting Finaloop, I was a mergers and acquisitions partner at PwC, and I also founded several e-commerce businesses simultaneously. My background in taxes and trading helped me identify a significant problem in gaining visibility into the financial side of the business. The business had zero visibility, and the only way to get information was through accountants, who often provided it late and incorrectly. Every e-commerce entrepreneur needs to manage books for legal purposes, and today this is typically done through accounting firms using unsuitable software. We replace both the software and the accountants, providing a real-time financial system. All financial reports are generated in real-time, offering full visibility," said Pinchevski.
