London-based startup Codat announced it’s raised $10 million in venture funding. The capital comes from venture firm Index Ventures, who is also the backer of companies such as Adyen, Plaid and Robinhood. The funds will enable Codat’s expansion to the U.S. and help grow the company to 100 employees by the end of the year.
Codat uses a single API to provide seamless integrations to financial software used by small businesses. In doing so, Codat allows financial organizations to access a company’s accounting software, payment terminals and more. For small businesses, Codat’s approach allows for simplified and improved interactions. For banks, Codat equips them to better understand the unique needs of business customers and provide tailored access to financial solutions.
CEO and co-founder of Codat, Peter Lord, shared in a statement, “The way small businesses interact with banks has been broken for a long time. They operate in a system that’s clumsy and unable to scale. Reviewing balance sheets, for example, soon becomes a nightmare of data requests and manual entry. Coronavirus has exposed those weaknesses for all to see, and accelerated the urgency of digitization.”
“At Codat, we’re trying to shift the model for business communication from being like exchanging letters in the post, to instead having an intelligent real-time platform that automates communication and builds trust between the parties,” Lord continued.
Codat was founded in 2017 by Lord, COO Alex Cardona and CTO David Hoare. The three co-founders have backgrounds in software engineering and previously worked together at what’s now known as MarketFinance.
According to Jan Hammer, Partner at Index Ventures, “Codat represents a huge opportunity to increase the bandwidth and speed of business interactions.” By making “data exchanges between businesses smoother and more responsive” Codat allows “systems to communicate electronically and seamlessly with each other in real time,” says Hammer.
“We believe Codat represents a step-change that will dramatically expand businesses’ access to capital, customers and new commercial possibilities,” Hammer said in a statement.
Codat is based in London and has over 50 clients globally. The company plans on opening a U.S. office shortly.
