Fundbox, a company that loans businesses money for outstanding invoice payments, has raised $40 million. The Series B round was led by General Catalyst with participation from Nyca, Khosla Ventures, Shlomo Kramer and Blumberg Capital.
If a small business owner needs growth capital to open a new store or purchase inventory, tech-enabled services such as OnDeck or Lending Club provide a quicker and cheaper alternative to the traditional big bank loan. But the primary strain on a small business is the more monotonous task of managing cash flow and recurring expenses. Fundbox provides short-term loans so businesses can keep up with expenses while they’re waiting the 30, 60, or 90 days it typically takes for invoices to be paid. “There’s an increasing trend that invoices actually get paid over longer and longer periods of time, and cash flow management is now the number one reason these businesses go out of business,” says Hemant Taneja of General Catalyst, who is joining Fundbox’s Board of Directors.