Float Financial, an expense management and corporate card startup focused on the Canadian market, has raised $48.5 million in a Series B funding round.
The Toronto-based fintech likens itself to U.S.-based fintech giants Brex and Ramp but says it is different in that its sole focus is on Canadian SMBs, which CEO and co-founder Rob Khazzam said are “overlooked due to Canada’s banking monopoly and tough economic climate.”
Goldman Sachs Growth Equity led the financing, which included participation from OMERS Ventures, FJ Labs, Teralys and existing investor Garage Capital. The raise brings Float Financial’s total venture funding to US$92.6 million since its 2020 inception. The company also raised a $36.9 million credit facility in February of 2024, which it is using to extend credit to customers.
The company declined to reveal valuation, noting only that it was an “up round” from its US$30 million Series A raise led by Tiger Global in November of 2021.
While Khazzam declined to reveal hard revenue figures, he claims that Float has seen its revenue increase by “50x” and total payment volume by 45x since that Series A raise. It also says it has seen a 30x increase in assets under management, he added. The company is not yet profitable.
Float launched its first product in May of 2021 and has slowly been expanding its offering from corporate cards and expense management to include bill pay, high-yield accounts, accounts payable automation and virtual physical cards in both Canadian and U.S. dollars. Jane Software, LumiQ, Knix are among its 4,000 customers.
Khazzam dismissed what he described as “talk in the media lately that Canadian businesses are not a good place to invest right now.”
“The landscape of Canadian SMBs is rich and diverse and chock full of potential,” he told TechCrunch. “At Float, we understand that addressing the needs of these businesses requires a distinctly Canadian approach…Our financial system needs to match the speed and ambition of Canadian businesses if we want to thrive locally and compete globally.”
Float plans to use its new capital to further expand its product offering and regional presence within Canada as well as continue hiring.
Laura Lenz, partner at OMERS Ventures, believes that Float’s “ability to work within the Canadian regulatory framework and…understand the nuances of this market” is critical to its success.
“It takes someone intimately familiar with these nuances to be able to create a product that works,” she said. “As investors with strong Canadian roots, we know there is an urgent need for banking infrastructure that helps Canadian businesses keep pace with their US counterparts and remain competitive on the global stage.”
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