London-based Storfund, a startup that helps e-commerce sellers drive sales and increase profitability by shortening their cash cycle, announced that it has raised £100M (approx €118.7M) in a fresh round of funding. The funding can be extended to £300M.
The round was led by Fasanara Capital which has been investing heavily in e-commerce lending platforms over the last few years.
Fasanara’s CEO Francesco Filia says, “Storfund is a true tech-first company, capable of delivering globally; it just needs the funds to reach scale. They’ve built their brand on transparency, particularly on pricing, and on international reach which has helped them win large, experienced retailers as clients.”
The funding comes after the company witnessed a massive 1200 per cent growth between December 2019 and December 2020. Storfund expects to continue this growth trajectory for the next two years. This year, it aims to provide $1B of cash advances to e-commerce merchants selling on Amazon and other European, American, and Asian marketplaces.
According to reports by Storfund, about 50 per cent of online purchases globally are made on marketplaces. However, retailers grapple with exceptionally long cash cycles as marketplaces hold back consumer payments to facilitate returns and refunds.
Storfund will use the newly raised funds to increase cash flow to retailers, particularly in China where the company is piloting its service this autumn. The company looks to reach its target of £5B in annual financing for ecommerce retailers by 2024.
Storfund already offers its services to e-commerce retailers in North America and Europe and the new funds will help it to expand its services to Latin America and Asia Pacific based e-commerce retailers.
“Sell today, get paid today”
Worldwide sales from marketplaces have grown by 140 per cent in the last five years, reaching £3T in 2020. But marketplaces hold back customer payments from retailers for anything from a week to 60 days as a part of their operating model to make it easy to offer refunds.
These payment delays constrain e-commerce retailers’ opportunity for growth at the moment when demand for their products is high.
This is where Storfund steps in.
Founded in 2018 by former investment bankers George Brintalos and Akbar Ahsan, Storfund is on a mission to democratise capital for e-commerce marketplace retailers with a simple concept: “Sell today, get paid today”.
Brintalos explains, “Storfund bridges the gap between e-commerce and capital, which is under served by traditional banks which are either too rigid to adapt or are withdrawing from the SME sector. We are here to address the capital needs of this new category of entrepreneurs, providing them with the liquidity they need to naturally grow their business, without adding unnecessary debt on their balance sheet or diluting their share capital base.”
Combining the access to working capital and international cross-border payments in over 50 currencies, Storfund provides e-commerce sellers with an end-to-end solution for stabilising cash flow, accelerating growth, and increasing profitability from their local and international sales.
Furthermore, by eliminating payment delays on marketplaces, the company also helps retailers to restock more quickly, negotiate better terms with suppliers, and plan more effectively.
Akbar Ahsan adds, “Marketplaces provide an unrivalled platform for retailers of all sizes to expand throughout the world and they’ve built the necessary infrastructure to support this – but they know their retailers can’t thrive without liquidity and fast access to cash. It’s the demand from both ends – retailers and marketplaces – which makes Storfund’s service so attractive.”
Storfund is Amazon’s only approved global provider of factoring – immediate payment on sales – delivering its service in 17 out of Amazon’s 20 marketplaces. It is also integrated into other European ecommerce sites and is due to be rolled out onto several other marketplaces during 2021.
The company last raised £26.5M in a funding round led by Union Bancaire Privée (UBP) in February.