HoneyBook, a financial management and client experience platform for service-based small businesses and freelancers, has raised a $155 million Series D round.
The San Francisco-based company’s funding round put the company at a valuation over $1 billion, HoneyBook CEO Oz Alon told FinLedger.
The round was led by Durable Capital Partners LP with participation from Tiger Global Management, Battery Ventures, Zeev Ventures and 01 Advisors. Also, existing investors Norwest Venture Partners and Citi Ventures participated.
HoneyBook will use the capital infusion to grow its product development and scale internal resources, including hiring more employees to meet rising demand.
The company provides tools like billing contracts and client communication to help service-based small businesses and freelancers organize their business. Founded in 2013, it has booked over $3 billion in business on its platform.
Naama Alon, HoneyBook’s co-founder and chief of product, told FinLedger that the company streamlines the process of handling client relationships and business.
“What we’re trying to elevate and give [our members’] the power to do is streamline communication from the beginning to the end of the project, but at the same time retain more customers, because they give them the best experience for every stage,” she said.
Oz Alon said that the onset of the COVID-19 pandemic caused unemployment to rise and many folks shifted into a self-employment lifestyle where they take a passion they have and sell it as a service. HoneyBook benefited from this shift and is seeing a tremendous amount of growth.
For instance, the company tripled annual recurring revenue in 12 months and it saw its new subscribers more than double in the past year. In the past nine months, members booked over $1 billion in business on the platform.
The company claims that service-based small businesses command over $1 trillion of the national economy.
Currently, HoneyBook has slightly above 100 employees, but is looking to grow its employee base by 50% by the end of this year across departments but with a concentration in product and development.
Going forward, Oz Alon said that the company is seeing the need to offer more financial products.
In other recent funding news, fintech Wealthsimple has raised about $610 million in a funding round with a post-money valuation of about $4 billion. The round was led by venture capital firms Meritech and Greylock.