Pipe, which wants to be the “Nasdaq for revenue,” got $150 million at the end of March. This means that the fintech company Pipe is now worth $2 billion. Pipe’s goal is to become what they call the “Nasdaq for revenue.”
Pipe, based in Miami, has now confirmed that it was able to raise $250 million in a round that was “massively oversubscribed” and valued at $2 billion.
The Pipe was started by Harry Hurst, who is still the CEO and co-founder of the company, In an interview, he said that the business’s original goal was to raise $150 million, but they decided to stop at $250 million even though they could have gotten a lot more. As had been said before, the investment was led by Greenspring Associates of Baltimore, Maryland as per azevedotechcrunch.
New investors, such as Counterpoint Global of Morgan Stanley, CreditEase FinTech Investment Fund, Fin VC, 3L, and SBI Investment of Japan, also put money into the company. Several of the company’s previous investors, such as Next47, Marc Benioff, Alexis Ohanian’s Seven Seven Six, MaC Ventures, and Republic, put money into this round of funding.
About two and a half months ago, Pipe finished a “strategic equity fundraising” that led to $50 million in funding from several well-known investors. Siemens’ Next47 and Jim Pallotta’s Raptor Group were among these investors, as were Shopify, Slack, HubSpot, Okta, and Social Capital’s Chamath Palihapitiya.
The Pipe has raised a total of about $316 million in funding, including this most recent round of funding. With its most recent round of funding, the company grew after a “significant rise in value” from its previous round of funding.
As a writer who first covered Pipe in late February 2020, when they secured $6 million in early investment, it has been exciting to see the firm’s progress since that time. The Pipe is a startup that develops software that helps people communicate more effectively. Pipe says that the fact that it was able to attain a value of $2 billion just under a year after its public debut in June of the previous year makes it the quickest fintech company in history to reach this valuation. Pipe’s public launch took place in June of 2017. Even though I cannot provide evidence to support that assertion, I can affirm that its expansion has been both rapid and remarkable.
The pipe was established in September 2019 by Hurst, Josh Mangel, and Zain Allarakhia to provide SaaS companies with a means of obtaining their revenue upfront. Pipe accomplishes this mission by matching SaaS companies with investors on a marketplace that pays a discounted rate for the annual value of those contracts. (Pipe refers to the financial institutions and banks that make up its buy-side participants as “a vetted group.”)
The Platform Purpose
The platform’s purpose is to provide businesses with regular income streams with access to money so that they do not need to take out loans or have their ownership stake diluted by funding other sources.
According to Hurst, the Pipe trading platform has attracted more than 4,000 businesses since it became available to the general public in June 2020. Just over 1,000 of those businesses have joined the platform since it was raised in March. The annual recurring revenue (ARR) that can be exchanged on the Pipe platform exceeds one billion dollars and is heading toward two billion dollars.
Tens of millions of dollars are being traded on the platform every month. My most recent conversation with the firm, which took place in March, informed me that it had recorded transactions totaling tens of millions of dollars for the first quarter.
Hurst said that the company’s growth has been “crazy.” This provides some insight into how we were able to raise capital at such a high valuation and get the attention of many investors. Pipe’s platform has developed over time to the point where it now provides non-dilutive finance to businesses, not in the SaaS industry. According to Hurst, the company presently has 25% of its clients who are not using SaaS, but he anticipates that this percentage will rise to over 50% by the end of the year.
According to Hurst, some examples of businesses currently utilizing Pipe’s platform include online pharmacies, insurance brokerages, direct-to-consumer enterprises with subscription goods, property management companies, and even groups associated with sports and entertainment. Even venture capitalist companies utilize it.