Formance raised funding of 3.1 million dollars in a successful pre-seed round
Paris-based FinTech has developed four API technology products designed to facilitate and accelerate companies with complex payment networks
Formance raised 3.1 million dollars in a successful pre-seed funding round. FinTech’s goal is to expand its services and address the crisis currently affecting the FinTech ecosystem.
Formance has an impressive list of investors, including perhaps the most well-known accelerator in the world. Investors include: Y Combinator, Hoxton Ventures, Frst.
FinTech has developed four API technology products designed to facilitate and accelerate companies with complex payment networks (such as online marketplaces and fintechs) to monitor payment flows between inputs and outflows in real time and between different merchants and intermediaries.
Most of Formance’s offer is open source and free, and then charges for any more customizable and personalized building blocks (which are cloud-based) that companies may want to add to them, in a subscription model.
The payments sector is an extremely well-capitalized market, but obviously there are still aspects that can be addressed and needs that new Startups can meet. So far, there have been different approaches to the problem of monitoring complex payment procedures.Global “behemoths” like Stripe and Adyen allow customers to track payments made through their platforms — but not all the inputs and outflows a company can have.
So far, Formance has been piloting its APIs with a fintech since February. With the new funding, it is set to start with more of the clients with whom it has spoken – who, according to co-founder and COO Anne-Sybille Pradelles, are mainly based in Europe, the USA and Africa.It also plans to increase its team to 12 people this year, hiring mostly engineers.
“We want to be conservative with hiring at the moment and focus on having a really strong core team of developers working on the product before we expand,” says Pradelles.At the moment, Formance is aimed at Startups and SMEs that are categorized as marketplaces or fintechs, but Pradelles argues that next year the company plans to start working with corporate customers as well.
Formance seems to have identified a specialized gap to fill in terms of payment processing, which is difficult to do with all the noise of payments out there. If it manages to convince several companies to migrate from the systems they have built in their home to its simplest solution, it could be in something. The hard part will be going through the multitude of European payment giants to gain market recognition among Startups and SMEs for what it can actually do to help.