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Ex-Robinhood employees’ fintech Parafin snaps $60M to help small businesses with cash flow

Parafin founders
Image credits: Parafin

Parafin, a fintech that serves small businesses better, faster, and cheaper, has scored $60 million in Series B financing. With this, the total equity funding raised by the company accounts for $94 million.

The investment round was led by GIC. This round includes participation from new and existing investors, including Series A and Seed lead investors Thrive Capital and Ribbit Capital (which invested in Alan and Atlantic Money).

Plans new products and services

Parafin intends deploy the funds to continue to launch new, innovative products for small businesses, such as business charge cards, and further establish its market leadership in embedded financial services.

“Small businesses have a huge, unmet need for capital and are poorly served by the status quo,” said Vineet Goel, co-founder of Parafin. “We make it simple, seamless, and fast for any Platform that serves a small business to offer financial products that accelerate their small business’ growth and increase their loyalty and lifetime value.”

“Most platforms fail to recognize both how much untapped demand their Sellers have for capital and how hard it is to build these financial products in-house,” said Sanyam Satia, Engineering Lead at Parafin. “We’re focused on solving hard infrastructure problems so that Platforms can best serve their Sellers.”

Financial products for small businesses

Parafin was founded in 2020 by former Robinhood employees Sahill Poddar, Ralph Furman, and Vineet Goel in San Francisco. Companies such as marketplaces, vertical SaaS, and payment processors rely on the fintech infrastructure startup to launch and embed financial services for their sellers.

Previously, most platforms found it complex and expensive to launch a financial services program for their small businesses. Parafin resolves this with its vertically integrated, full-stack offering that manages everything from product, underwriting, capital markets, compliance, and marketing for its partners. It enables companies that serve small businesses launch a white-labeled financial services program in just a few days.

It helps help small businesses bridge their cash flow needs, invest in their growth, and run their business. With Parafin-powered fintech products, small businesses can accept capital in a few clicks, ensuring that they can get the support they need while continuing to focus on running their business. As per the company, 90% of small businesses say their perception of the platform has improved since the launch of a Parafin-powered capital program.

Parafin powers the embedded capital offerings of companies with over $100 billion in payments volume, including DoorDash Capital and Mindbody Capital. Companies that use Parafin together serve over 700,000 small and medium-sized businesses around the world.

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