In the next few months, Austin startup Invoiced will be moving out of Capital Factory where it has operated for several years and into a new office in Southwest Austin.
Founder Jared King likes to call it "graduating," and the move represents a milestone for the startup, which has been bootstrapped from its start. And the company has big plans for the years to come.
In 2019, King projects Invoiced, which is a cloud-based accounts receivable automation platform, will grow its team from seven to 14 and double the number of invoices it processes for its clients. In the long-term, Invoiced wants to be the market leader in the emerging accounts receivable automation space.
With 20,000 customers and over $40 billion in invoices processed on their behalf, Invoiced might look like a venture-backed company. And many software startups with that kind of reach need that outside funding to grab the attention of prospective clients.
But King says Invoiced has been fortunate in that it was early to the space and that its software is part of the accounting division of businesses, which puts the return on investment at the forefront and makes it easier for companies to justify paying for an Invoiced software subscription.
"it sort of slapped me in the face that it was a business opportunity, but I hadn’t thought of it that way for a quite a while."
For example, Invoiced tells customers its mission is to improve collections by 5 percent. So for every $500,000 one of their clients bills its customers, it could collect $25,000 more using the automation platform.
Without Invoiced's software, an accounts receivable specialist or even the business owner typically manages invoices and payments. That often involves multiple software programs – as well as following up with customers about getting paid. Sometimes, the number of invoices grows too large to keep track of.
“You’re really going to be missing out on a lot of money,” King said. “It’s a big risk for certain businesses that run on this credit.”
King began to recognize the opportunity to build a cloud-based automated accounts receivable platform when he was a student at the University of Tulsa building the payment portion of a variety of sites and mobile apps.
“I had built, basically, Invoiced, two or three times.”
In 2012, King created a free invoice generator that generated a basic invoicing form for anyone who wanted it. As part of that, he asked people for feedback. He kept iterating on the concept as people who were using it for free suggested features they'd be willing to pay for.
“That’s when it was pretty clear this could be a good business," he said. "So it really… it sort of slapped me in the face that it was a business opportunity, but I hadn’t thought of it that way for a quite a while.”
Invoiced launched its paid version in 2013. King moved to Austin around 2014, and later met co-founder and COO Parag Patel at Capital Factory. That's when the two decided to make Invoiced their full-time focus. They ran the company as a two-person team until early 2018.
King said people have sought Invoiced out with very little marketing. One of their early enterprise clients told King they had found Invoiced around page eight of a Google search.
“Basically, there was just a lot of demand for this, and people were just searching and searching and they would eventually stumble upon our product somehow through a Google search or through our free invoice generator," he said. "They were looking for this and eventually found us, and we didn’t even make it easy for them.”
That organic growth has helped the company remain bootstrapped. King says its subscription model hits the metrics and financial milestones typically required of Series A startups.
King won't rule out venture capital funding in the future, but he's not focused on it now and sees advantages to maintaining independence.
“We don’t have those investors and that board to answer to," he said. "So that just means we’re laser-focused on our customers and laser-focused on our team and really anything else that doesn’t help our customers and help our company move forward, we just cut it out.”
CMO Adam Weinroth, who has worked for venture-backed startups, said Invoiced is a little different than many other bootstrapped startups.
“I think a lot of times when companies maybe have the possibility of being able to live and operate without some kind of outside funding source, a lot of times that means just operating or maybe kind of treading water," he said. "But with Invoiced, it’s bootstrapped and cash flow positive and growing similar to venture-backed firm. I think we’re a different kind of story even within the bootstrapped realm.”
And that means they can easily move to whatever office suits them best.
In a few months, Invoiced will move to a new office in Southwest Austin. That's where most of its employees live, and King said that he has calculated the team will collectively save three and a half hours per day in commuting time by relocating.
And that fits with Invoiced's primary theme.
“Everything we do, we have efficiency in mind,” King said.
