FlowFia startup building a niche finance marketplace for entrepreneurs, closed $9 million in funding.
Blumberg Capital led the investment and was joined by a group of investors including Parade Ventures, Differential Ventures, Precursor Ventures, Special Ventures, 14 Peaks Capital and Cooley LLP.
Nate Cavanaugh and co-founder JJ List created the company in 2021 to automate accounting functions for founders. Before that, Cavanaugh founded Brainbase, which was later acquired by Constellation Software in 2022. List, an investor, was Cavanaugh’s first check on Brainbase.
Accessing important accounting metrics in an understandable way was something Cavanaugh himself struggled with as a founder.
“I was trying to prepare for board meetings and prepare financials for our investors, and I was really frustrated being a founder with no finance background and trying to get a pulse of what was happening in the company in real time,” Cavanaugh told TechCrunch . .
Chat mode of FlowFi. Image Credits: FlowFi
He then contacted List about the idea. List also said accounting help was something many of his portfolio companies consistently requested. But the available solutions “didn’t necessarily match what business people typically wanted,” he said. List liked Kavanaugh’s solution so much that he joined him at FlowFi.
FlowFi combines technology with financial experts, including CFOs, accountants and tax professionals from companies such as PayPal, Netflix, Headspace and UNREAL Brands. It then goes beyond traditional bookkeeping to show founders key non-GAAP financial metrics, such as monthly and annual recurring revenue, gross margin trends, and supplier spending trends.
Nearly three years later, the company has more than 100 customers and generates millions in annual recurring revenue, Cavanaugh said. FlowFi also enables financial professionals to create independent businesses.
Accounting software can be a little boring, but as more and more startups come to fruition, it’s an area that venture capitalists are loving right now. We’ve seen the likes of Fund and Indy announce new funding recently, while Pennylane went unicorn.
FlowFi intends to deploy the new capital in R&D to continue technology development so customers can integrate their accounting systems into FlowFi. It also creates more ways for founders to understand their KPIs and collaborate with financial experts.
The flip side is building AI-powered tools to automate functions that accountants do all the time, like categorizing transactions. In addition, the company plans to invest in sales and marketing.
“We’re our own customers, so we feel like we’ve got a good handle on what’s around the corner,” List said in an interview.
