The news: Danish fintech Pleo raised $150 million in a Series C round, valuing the startup at $1.7 billion, per a company blog post.
More about the company: Pleo operates a platform that aims to simplify expense management.
It offers spending cards for employees that automatically itemize purchases according to their company’s internal accounting systems. Pleo can also integrate invoice payments management and accounting with third parties like Xero and Quickbooks.
It has offices in Copenhagen, London, Stockholm, Berlin, and Madrid. Roughly 17,000 small and medium-sized businesses (SMBs) use Pleo, with companies at the medium end numbering about 1,000 employees.
What’s next? The fintech wants to expand its reach by targeting larger employers, an opportunity that likely caught investors’ attention.
CEO Jeppe Rindom said the fintech will use the fresh capital to attract businesses with up to 5,000 employees, according to TechCrunch. This change of focus will let Pleo turbocharge its growth, as it will be able to achieve the same user base growth while signing up fewer companies.
Larger clients may have a broader range of needs, but Pleo builds all its services from the ground up, so it will likely be able to adjust to a changing audience. As such, the fintech aims to reach 1 million users by 2025 as it tries to make a bigger dent in Europe’s $80 billion expense management market.
What about the wider market? Digital finance management for businesses is a hot topic globally: 66% of SMBs reported shifting finance and operations solutions online in March 2021.
Fellow expense management startup Expensify, which has more than $100 million in annual revenues and 10 million users, recently submitted its IPO draft registration. Denmark-based Ageras recently raised $73 million to connect small businesses with more than 5,000 professional accountants to help manage their finances, and accounting platform Pilot scooped up $100 million.