Finverity – a digital ecosystem for trade and supply chain finance – announced it has raised $5 million in a heavily oversubscribed equity funding round from new and current investors. The new investors include fintech specialist Outward, Acrobator Ventures, and s16vc founders fund with follow-on investments from MENA-based B&Y Venture Partners as well as a range of UHNWIs. This funding round comes on the back of 15x revenue growth in 2022 across the Middle East and Africa and the recent expansion to Eastern Europe.
Launched in 2017 by Viacheslav Oganezov and Alex Fenechiu, Finverity was created out of a vision to make the global financial system work for all, one product at a time. Fast forward over five years and Finverity has built the world’s first truly digital ecosystem for trade and supply chain finance in pursuit of achieving its mission of bridging the $1.7 trillion global trade finance gap by channeling capital to where it is most needed.
Finverity has a dual offering:
1.) Funding Platform – Brings together corporates seeking working capital and funders looking to deploy capital into quality mid-market assets on a single platform. And the platform provides a whole suite of services and technology to enable trade and supply chain finance deals to be executed seamlessly and at scale.
2.) Software as a Service solution – Provides an end-to-end technology system for banks and non-banking financial institutions (NBFIs) to completely revolutionize their trade finance and working capital operations, client experience, and risk capabilities.
The funding raised in this round will be used to immediately increase the headcount from the current 40 to 60 employees in order to meet rapidly increasing demand for Finverity’s solutions and complete office openings in Dubai, Poland, and Kenya. Plus Finverity’s technology is expanding to cover almost the entire range of funded trade finance and working capital products.
Supply Chain Finance (SCF) is the financing of a time delay between the moment goods/services are ordered/shipped and the time they are actually paid for. For example, if a farmer sells avocados to a local supermarket, they would probably get paid 60 days after the supply to the supermarket and issuing of the invoice. But SCF allows the supermarket to offer the farmer an early payment alternative at a fraction of the cost the farmer would otherwise incur if trying to finance that invoice themselves in a simple way. This boosts supply chain resilience, unlocks cash trapped in invoices, and allows businesses to grow organically with predictable cash flows.
Last year, Finverity originated over $500 million of demand from corporate clients for its financing solutions. And turning to its SaaS solution, Finverity offers banks and NBFIs an enterprise-level end-to-end system that can be deployed in under 21 days. This is in contrast to much longer deployment times in the industry, often exceeding a year. Integrated zero code customization provides banks and NBFIs with the immediate ability to rapidly roll out new trade finance and working capital products.
Finverity launched partnerships with numerous banks’ trade finance desks including Investec, National Bank of Fujairah, and FIMBank, focused on helping them scale their asset deployment by funding Finverity-originated transactions and digitalizing trade finance operations using Finverity’s technology. And as a result, partner banks can shorten their credit approval times, reduce their operational costs and fund much larger deal volumes without having to build out a huge internal team. This leads to better overall client offerings.
KEY QUOTES:
“The pace at which our industry is evolving is truly impressive. Five years ago, Supply Chain Finance (SCF) barely ever made the headlines. It wasn’t even a “real” financial product in many countries. Today, it’s deemed a key requirement to fuel economic growth for the years to come. This means we have moved into the mass adoption phase of SCF. What is needed today is very different from what has been used for the last 20 years. We have created a wizard which allows financial institutions to launch new products in the working capital space in 4 weeks instead of 12 months. We have also helped banks and NBFIs alike increase utilization from existing clients and reduce losses due to fraud and default. Our time is now and with our new partners, I’m confident that Finverity will be a leading driver of SCF & working capital innovation across emerging markets.”
— Alex Fenechiu, COO & co-founder of Finverity
“When we started this fundraise the market was just starting to go through a rough spot, so there was a lot of talk about negative sentiment. However, what we found is that there is a significant amount of venture capital out there. Funds have been raised and need to be deployed, investors are just more selective. Our industry is counter-cyclical, and we designed our business to grow in a sustainable way, with positive unit economics and a clear path to profitability in mind. The current macro trend has played to our strengths and allowed us to select amazing partners for the journey ahead! We are very grateful to all of our new investors and are excited to build out the next stage of Finverity’s growth in partnership with them!”
— Viacheslav (Slava) Oganezov, CEO & co-founder of Finverity
“Whilst technology has powered exponential growth of the multi-trillion dollar SCF and trade finance industry in developed economies over the last decade, some of the world’s most important emerging economies have been somewhat left behind. Prohibitively high set-up costs, immediate and complex integration requirements and insufficient AML/KYC capabilities of existing platforms all act as contributors to manual and paper-based processes remaining the market norm. Finverity team’s deep understanding of these acute pain points has enabled the creation of a solution that is truly fit for purpose.
“Fast deployment, easily configurable and customizable workflows, clean and intuitive UI, and market-focused origination capabilities are already having a profound impact on their target markets, enabling the launch and growth of SCF for organizations where it was not previously possible. We firmly believe that this dynamic, combined with the growth outlook and increasing digitalization of emerging economies, all point toward an enormous opportunity for Finverity to emerge as the global leader in this space. As such, we at Outward are proud to be partnering with Slava, Alex and the rest of the team to support this exciting next phase of growth and beyond.”
— Andi Kazeroonian, Investment Manager at Outward VC
“From the first call, it was clear that we were dealing with something special, both in terms of the magnitude of the problem Finverity is trying to solve and the characters of the founders, Slava and Alex. These founders possess a rare combination of grit, vision, humility and empowerment. The team members, advisors and investors who have joined them in their quest to create a more even playing field for SMEs in developing markets are a testament to that. It’s very rewarding to play a small part in this big-impact story.”
— Joachim Lacquer, General Partner & Co-founder at Acrobator Ventures
“Having first met Alex and Slava more 3 years ago, it’s been amazing to see how much progress the team has made towards fulfilling their vision of making trade finance globally fairer and more accessible. We are in the early days of SCF tech enablement, and it’s exciting to think about the scale of challenges and opportunities in this space. As a founders’ fund, we love partnering with ambitious founders looking to solve massive challenges and we are excited to be working with Finverity as they turn their vision into reality.”
— Oleg Bibergan, Managing Partner, s16vc founders fund
