Accounting software startup Pennylane becomes France’s latest unicorn

[ad_1]

Like clockwork, Penny Lane raises an additional 40 million euros ($43 million at current exchange rates). This new funding round comes after the accounting startup raised 4 million euros in 202015 million euros in 202115 million additional euros in 2021 again50 million euros in 2022 and 30 million euros in 2023.

You might think that this is a lot of money for a company working on… accounting software? Indeed, the startup is growing well with more than 2,000 accounting firms now using Pennylane as their main software tool.

Some companies with in-house accountants also use Pennylane directly, but the vast majority of the company’s clients come from these accounting firms. In total, this means that 120,000 small and medium-sized businesses trust Pennylane for their accounting needs in France.

Over the past two years, Pennylane’s SMB user base has grown 40x. You don’t often see this kind of growth rate, even for a startup.

“We have a glass ceiling, that of ERP software. We are not going to replace SAP. However, under SAP we are a very good alternative as an accounting and financial tool for SMEs. Today we work with companies with just over a thousand employees,” Arthur Waller, co-founder and CEO of Pennylane, told me.

With today’s funding round, existing investors Sequoia Capital and DST Global are increasing their stake in the startup. And Pennylane has now reached unicorn status, meaning it has reached a valuation of at least $1 billion.

In Pennylane’s case, that’s a valuation of “just over a billion euros,” Waller said. “This roughly doubles the valuation of the last fundraising,” he added.

An app to manage your business finances

In addition to Pennylane’s unique distribution strategy, the company has been adding new features at a rapid pace. As a modern SaaS product, it connects directly to third-party services containing valuable information. For example, you can get bank statements in the Pennylane interface, import receipts from Dropbox, and get billing information from Stripe.

Combined with in-house OCR technology, Pennylane can save time entering data into the accounting platform. Pennylane has also added fintech products with business banking and payment cards integrated directly into the platform.

You don’t need to use Pennylane as your bank account, but you can. 20% of Pennylane customers have a bank account with Pennylane. And because other fintech companies like Honestly As businesses strengthen their financial and accounting management capabilities, it is important to provide an all-in-one accounting and financial product.

Arguably, Pennylane wants to become Qonto before Qonto becomes Pennylane. Of course, both Pennylane and Qonto have integrations with the other service so users can sign up for both services and use them seamlessly. “But when you run a restaurant, you prefer to have everything in one place. You prefer to have one software subscription,” Waller said.

And because business owners and accounting firms have access to the same platform, everything stays in sync. Pennylane also handles invoicing, purchase orders, vendor payments, accounts payable, and more.

Finally, Pennylane also plays with artificial intelligence in two different ways: finding relevant information in accounting data and helping accountants follow accounting rules for the most complex edge cases – a sort of accounting co-pilot.

Even though Pennylane doesn’t have a money problem, it still hopes to become profitable within the next 12 to 18 months. And if there’s one thing Pennylane should be good at, it’s tracking the startup’s financial situation.

[ad_2]

Leave a Comment

Your email address will not be published. Required fields are marked *