Codat, a London-based startup that connects the internal systems of small firms to financial institutions to enable business data to flow back and forth in real time, has raised $10 million from Index Ventures.
The money will be used to help Codat expand into the US with a new office and to build up its team to 100 people by the end of the year.
Codat uses a single API to directly ‘plug in’ to the software used by small businesses - allowing banks, fintechs and other FS players to access everything from the company’s accounting software to payment terminals recording real-time transactions.
The technology cuts out the need for unwieldly Excel documents and PDFs sent via email, simplifying the process of sharing information. For banks and fintechs, the company says it helps them scale and speed up their offerings to millions of small businesses.
The firm was founded in 2017 by CEO Peter Lord, COO Alex Cardona and CTO David Hoare, who had worked together at what is now MarketFinance, a peer-to-peer invoice finance platform. It has quickly built up a userbase, with 10,000 new small businesses each month using its app to link directly to 50 financial providers.
Says Lord: "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."