Juni jumps on $206 million to help e-commerce players better manage their own money – TechCrunch

The e-commerce market is on track to pass $5.5 trillion in revenue this year, which indicates not only how many consumers are shopping online these days, but also how many businesses are currently selling to them. Today, a startup from Gothenburg, Sweden called June announces $206 million in funding – $100 million Series B and $106 million in additional debt – to create an e-commerce-focused neobank, designed specifically to meet the needs of this growing group of retailers with tools to help them manage their business.

Mubadala Capital led the $100m seed round, with former backers EQT Ventures, Felix Capital, Cherry Ventures and partners of DST Global also participates. Meanwhile, the $106 million in debt funding — which Juni will use to power its credit products — comes from TriplePoint Capital.

Founded in 2020 and launched in 2021, Juni only closed its Series A in October last year (it raised $21.5m in July and another $52m in October), but it has experienced a very rapid rate of growth – “several hundred percent”, CEO said Samir El-Sabini in an interview. (He didn’t give actual numbers on customers.) He won’t disclose his valuation, but sources close to the company tell me it’s now around $800 million.

Most incumbent banks, and now a fair number of neo-banks, target small and medium-sized businesses as customers. But the market gap that Juni has identified and built to fill is that the needs of e-commerce SMBs, and those doing business online in general, are unique among them.

E-commerce businesses potentially have huge amounts of money flowing in and out of their accounts, and that money doesn’t necessarily arrive consistently. They likely do business in multiple geographies and with multiple vendors. And in addition to potentially selling across a number of platforms and marketplaces (which also add complexity to finances and managing them), they use a number of other digital tools to both sell, manage and help develop their operations.

El-Sabini, who co-founded the company with CTO Anders Orsedal and Jonathan Sanders (who is no longer with the company but remains a “silent partner,” El-Sabini said), all had backgrounds of working in digital businesses where they saw, not just for themselves but for their clients, an opportunity to build a bank that took all this into account (therefore to speak) and builds a financial management service which adapts to this dynamic.

So for Juni’s basic banking, credit card and principal advance/reimbursement services (where debt financing will be used), accounting and analytics are all optimized for the type of e-commerce business entries and exits. The platform includes some 2,400 integrations with tools (and the data generated by those tools) that companies could potentially use for their accounting, digital advertising, website payments, and more.

And while it sounds like a really big product with lots of tentacles, Juni has actually narrowed its reach over the past year. The company initially launched catering for both e-commerce retailers and digital marketers, as the latter group also has a lot of similar dynamics, spending money in multiple jurisdictions and leveraging a variety of marketing and advertising technologies. Now he has shifted his target customer and the tools he builds, more specifically to the e-commerce vertical and the marketing they undertake.

“WWe focus on e-commerce businesses,” El-Sabini said. “However, marketing is an important function in all e-commerce businesses.”

The business was launched during the pandemic, which was kind of a godsend: there were suddenly a lot more consumers buying a lot more online, and e-commerce companies were scrambling to both connect and sell to those audiences without going bankrupt, so having a banking partner that could help with that was part of what led to such strong growth for Juni.

Interestingly, and as you’d expect, this need isn’t going away as the pandemic subsides. Growth is definitely slowing in this sector (falling by at least four percent globally and continuing to do so over the next few years, according to eMarketer) and so e-commerce businesses have to deal with that as well.

“The cost base is generally under pressure, and we can provide credit with good forecast information for our customers, so they understand cash flow,” and cash flow is king for these customers, said he continued. “Something we also see is fear in the markets. So if you can get a partner who is long term and who can help you and understand your position, obviously that’s very important. We want lasting relationships with our customers.

Abu Dhabi’s Mubadala Investment Company, the parent company of Mubadala Capital, is a prolific fintech investor (it has backed Brex, SpotOn, GoCardless and many others), and Fatou Bintou Sagnang, the partner who led the investment, said she and the firm evaluated a number of other players in the banking sector focusing on SMEs before coming to invest in Juni.

“It all started with looking at SMEs and fintech enablement and we were looking for companies that fit that thesis,” she said in an interview. “We like companies that use technology intelligently to reduce costs.” She said they spent more than nine months getting to know young Juni and appreciated his interest in e-commerce. “We actually see a many parallels with Brex in the United States. We came in with some experience in this area for the sectors, and our thesis is that the next iteration in incumbent-challenging fintechs will be more verticalization.

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