Kabbage, an online lender for small businesses has raised $135 million in funding round led by Reverence Capital Partners, ING, Santander InnoVentures and Scotiabank along with other investors that includes Yuan Capital, Recruit Strategic Partners, BlueRun Ventures, UPS Strategic Enterprise Fund and Thomvest Ventures. This funding brings the company’s total equity to more than $240 million.
Founded in 2009 in Atlanta, Kabbage is a technology and data company that specializes in a new automated way to lend money to small businesses and consumers. It reduced the complexities of the manual application process and made it completely online and automated. It controls data generated through business activity like accounting data, online sales, shipping and dozens of other sources to understand performance and deliver fast, flexible funding in real-time. Last year, it launched a consumer lending market place called Karrot and is now operating itself as a provider of lending software and service to traditional banks.
With the fresh funds, Kabbage plans to bolster its balance sheet and plans to invest in marketing and a TV campaign starting early next year. “We are thrilled to announce our partnership with Reverence Capital Partners, ING, Santander InnoVentures, and Scotiabank, global leaders with deep expertise across financial services and technology,” said Rob Frohwein, Kabbage co-founder and Chief Executive Officer. “It is particularly gratifying to welcome three of the top fifty global banks to our shareholder base as we continue to expand our reach internationally, delivering an unparalleled experience to small businesses and consumers worldwide.”
Milton Berlinski, Managing Partner of Reverence Capital Partners said, “Lending is changing rapidly, with small businesses and consumer demanding a simpler and more customized experience. While Kabbage’s growth is remarkable, we are more impressed with Kabbage’s ability to scale while economically acquiring customers, decreasing risk and gaining significant operating efficiency.”
Further to the funding, Berlinski has joined Kabbage’s Board of Directors. This round of investment is considered to be first time in recent history that multiple global financial institutions have invested in a U.S based financial technology company, suggesting the potential for Kabbage’s platform to change the landscape of lending worldwide.