LONDON: MarketInvoice, a peer-to-peer business lender, just closed its first major round of financing despite already being four years old and lending over £475 million ($741 million) to date over its platform.
The London startup has raised £6 million ($10 million) from Nordic venture capital firm Northzone, which also backed Spotify, and the family office of Paul Forster, the co-founder of job search engine Indeed.com.
It’s the company’s “series A” round — tech speak for the for the first injection of capital from institutions rather than friends, family, or rich individuals.
It’s clearly been doing fine without outside investment. MarketInvoice, launched in 2011, turned a profit in 2013 and 2014.
Co-founder and CEO Anil Stocker explained why they thought the time was right to raise money now. He told Business Insider: “We feel we’ve really laid the foundations to push this into the mainstream. We went from doing £15 million ($23 million) a month last year to doing £30 million ($46 million) a month now. I feel like we’re really getting a momentum going. It’s the perfect time to put our foot on the accelerator.
And also from the market point of view, if you look at the attention the market is getting, not only from investors, but also from businesses, from the government — we think it’s a good time to raise the money.”
MarketInvoice is part of a wave of peer-to-peer businesses that have sprung up in the post-financial crisis world. A combination of bank lending drying up and poor returns for investors due to low interest rates have created the perfect conditions for peer-to-peer, where investors cut out banking middle men by lending directly to businesses or people.
MarketInvoice’s online platform applies the peer-to-peer lending model to invoice financing, a form of business lending where companies can borrow money against unpaid invoices. It’s effectively a way for businesses to get hold of money they’re due in the future today, although at a discount.
