Small Business Banking FinTech Novo Raises $4.8 Million Seed Round
A startup with a stated goal of helping other startups manage their money just received a big chunk of change in venture seed financing. FinTech firm Novo announced this week that it had raised $4.8 million in a round led by Crosslink Capital. While Crosslink’s investment totaled $3.5 million, other participants in the round included Red Sea Ventures, Rainfall, Hack VC, RRE, and the Stanford Law School Venture Fund.
Novo launched last September with the goal of simplifying small business banking. The company says they enable business owners to set up a checking account in less than 10 minutes. These accounts are FDIC insured, include a debit card, and claim to have no hidden fees. Business owners can manage their funds via the startup’s app. Another unique aspect of Novo is that they offer integration for Stripe, Slack, Zapier, Xero, and more to help entrepreneurs monitor their business’s financial health.
Explaining what makes their company different, Novo co-founder and CTO Tyler McIntyre said, “Traditional banks don’t understand the needs of founders and are held back by legacy technology. We built Novo from the ground up allowing us to deploy new features every week and integrate into the tools you already use for your business. That’s the way banking should be.” Meanwhile, speaking to the Novo’s latest funding round, co-founder and CEO Michael Rangel said in a statement, “We couldn’t be happier with the support of Crosslink Capital, Jim Feuille, and the rest of the great investors in the syndicate.” He went on to share some of the firm’s plans, saying, “Our focus will be on onboarding the many account requests on our waitlist, as well as creating strategic partnerships with other value-added products and services to enhance the Novo ecosystem and customer experience in addition to expanding our team.”
Novo’s seed round is just the latest investment seen in the sector as a big year in FinTech funding is expected. According to Business Insider, the first half of 2018 saw global FinTechs raising $57.9 billion. That’s just shy of the previous record $62.5 billion raised during the entirety of 2015.
With their $4.8 million round, Novo is set up to scale their growth and potentially become a major player in the FinTech space. While previous products have targeted general consumers with better banking solutions, Novo’s focus on small business stands out. As a result it will certainly be interesting to see what the company is able to achieve and build with their newfound funds.