Tradeshift, a platform for creating B2B payments, procurement in supply chains, and B2B marketplace services, announced that it managed to raise investment funds in the amount of $70 million.
The company intends to use the received financing to expand its business network. Currently, the firm has more than 1 million customers, including, for example, the food giant Danone and the National Health Service of Great Britain.
The company stated that as part of the disbursing of investment funds, the number of SaaS, B2B marketplace, and embedded financial services will be increased. The firm is also currently exploring the possibility of some acquisitions, about which there is no information.
The funding round was led by HSBC, which invested $35 million. AYTK Limited, LUN Partners Group, Fuel Venture Capital, Doha Venture Capital LLC, Conception Capital, IDC Ventures, and the Private Equity Fund also participated in this process.
HSBC is also embarking on a joint venture with its portfolio firm. This project will be a kind of addition to the existing Tradeshift business. The joint venture will be launched early next year.
HSBC is currently increasing the volume of financial services for businesses related to the technology sector. This year, the banking giant acquired a unit of the bankrupt SVB in the UK. Barry O’Byrne, HSBC’s CEO of global commercial banking, says that stimulating and growing global trade is in the DNA of a financial institution.
Tradeshift was founded in Denmark. The company is currently headquartered in San Francisco. The firm has extensive operations in Europe. Following the results of the next round of financing, the company did not update its assessment.
As a startup, the firm attracted nine-figure amounts of funding. Many experts were convinced that Tradeshift was on its way to an IPO, but as it turned out in the end, they were wrong. In the initial stages of its existence, the firm actively used such advanced technologies as, for example, blockchain to introduce new services.
In March 2021, when technology companies were thriving from a glut of funding, partly due to Covid-19, Tradeshift raised $200 million in investments at the end of the Series F round with a post-revenue estimate of $2.7 billion. Then many were also convinced of an imminent IPO, but they were mistaken.
The last round of financing took place in difficult external conditions. The current historical moment is not the most successful both for technology startups and for the sphere in which Tradeshift operates. In April, the company published a report that contained information that the stocks of B2B suppliers have increased sharply, but at the same time, trade and logistics services are in decline or demonstrate the dynamics of the slowest possible development.
In the second quarter, there were signs of a slight recovery in the US market, but the situation in Europe and China had no reason to be optimistic about the future. World trade on a global scale continues to show a decline. This is partly due to the consequences of the coronavirus pandemic that have not been fully experienced.
The сompany notes that working capital in the form of cash and liquidity are the main factors influencing the current situation. Demand in this case does not have a determining value. In part, these circumstances explain HSBC’s motivation for partnering with Tradeshift. In this case, the company’s activity will be stimulated and the banking giant’s business will expand.
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