Pipe, a company that has built a trading platform for recurring revenues, has secured $250 million in strategic equity funding, reaching a $2 billion valuation after publicly launching less than a year ago.
This funding round is notable for a couple of reasons, but especially for how fast this startup, which publicly launched in June 2020, has grown. Pipe has signed on over 4,000 companies to its platform. Pipe’s platform has tradable annual recurring revenue in excess of $1 billion and is “trending toward $2 billion, with tens of millions of dollars being traded every month,” a news release read.
Pipe, which refers to itself as the “NASDAQ for revenue,” initially allocated $150 million for the round but it was oversubscribed by $100 million. In March FinLedger reported on Pipe’s $50 million equity funding round.
The investment round was led by Greenspring Associates and also had new investors like Counterpoint Global (Morgan Stanley), CreditEase FinTech Investment Fund, Fin VC, 3L and SBI Investment. The round also saw participation from existing investors like Next47, Marc Benioff, Alexis Ohanian’s Seven Seven Six, MaC Ventures, Republic and others.
Harry Hurst, Pipe Founder and co-CEO told FinLedger, that with this investment round global institutions came together “to bolster this global expansion on both sides of the marketplace.”
Pipe’s trading platform provides companies of all sizes access to the capital markets, and works with companies that want to access their booked revenue up front by turning their quarterly or monthly recurring revenue into annual recurring revenue cash flow. Hurst emphasized that the startup “never positions itself as an absolute alternative to equity.”
The company will use the funding to scale its platform globally and “across every recurring revenue vertical,” including sports and entertainment, healthcare, VC fund management feeds and property management companies.
“Recurring revenue streams exist everywhere, in almost all business models. And if they don’t currently support recurring revenues, they’re thinking about ways that they can add recurring revenues to their business models,” Hurst said.
Hurst said that the primary reason for raising this capital wasn’t to hire aggressively, and that the company currently has about 34 employees.
“This business is humming and growing really fast, and we intend to keep it that way,” he said. “We will always be a lean company relative to our size and scale. Naturally, we will have to add headcount, but we’re not one of these companies that’s trying to quadruple headcount in a very short amount of time, just for the sake of hiring people to throw people at problems as opposed to building technology to solve problems.”
Recently we reported that the company is bolstering its sales and engineering departments with several new hires that come from the fintech giant Stripe and Kabbage, an automated lending platform for small businesses.
In other recent funding news, Amount has raised a $99 million Series D funding round to help banks compete with fintech startups.