Tranch, a London-based buy now pay later (BNPL) platform for SaaS sellers and services providers, has raised $100M in a seed funding round in the form of equity and debt.
The seed round was led by Soma Capital (New York-based backers of Frontrunner and Numida) and FoundersX (the investors behind Jeeves and Salt Security). In addition, several US and UK fintech founders participated in the round.
The funding round includes a credit facility from Clear Haven Capital Management. Further, Tranch’s existing investors include Global Founders Capital and Y Combinator.
The company will use the funds to grow the team in Tranch’s New York office and expand the ‘Pay with Tranch’ checkout across multiple industry verticals. The announcement comes eight months after raising £3.5M in pre-seed equity and debt funding.
Philip Kelvin, Co-founder & CEO of Tranch, comments, “Since securing our pre-seed funding and completing the Y Combinator programme, the total value of invoices we’re handling every month has increased tenfold. Traction is growing fast because suppliers and business buyers simply understand and like what Tranch can do for them. Against this challenging macroeconomic backdrop, buyers and suppliers must ensure they can optimise their working capital cycle, and B2B BNPL is a commonsense way to achieve that. With our new investors and substantial credit facility in place, we’re in a great position to continue our growth in the US market out of our New York office so that every SMB that needs it can ‘pay with Tranch’ – flexibly and on their own terms.”
BNPL for B2B
Founded by Beau Allison and Philip Kelvin in 2021, Tranch is a B2B buy now pay later (BNPL) platform enabling SaaS and services providers to be paid upfront and offer their customers flexible payment options for up to 12 months.
Through the company’s ‘Pay with Tranch’ payment method at checkout, providers, such as law firms and marketing agencies, can offer an alternative way for their end customers to pay for contracts worth up to $500,000.
After beta-launching in the UK, Tranch was accepted into the Y Combinator accelerator and launched in the US. As per the company’s claims, it has spread out millions of dollars of invoices across multiple verticals in the services and SaaS industries.
In the six months to the end of 2022, monthly invoices spread into flexible payments via Tranch’s platform increased tenfold, claims the company. Early service providers include New York-based procurement platform Tropic and international law firm Goodwin Procter LLP.
Aneel Ranadive, Founder, Soma Capital: “Tranch is leading the way to open up B2B flexible payment options beyond the e-commerce and marketplace sectors. Every year SaaS and other service providers like law firms, marketing agencies, and consultancies generate billions of dollars worth of large invoices on terms that don’t work for them or their customers, simply through lack of choice and innovation. ‘Pay with Tranch’ provides them and their customers with an alternative way to handle payments. With Tranch, payments no longer have to be a hurdle but an enabler to business growth.”
Mark Simmer, Managing Partner, Clear Haven Capital Management: “We’re excited to partner with Philip and the expanding Tranch team as they rewrite how businesses pay for their SaaS and services invoices. We look forward to supporting them with capital to achieve their next growth stage and help more businesses across the US make better payment choices.”
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