A Raleigh fintech targeting startups has closed a $6.5 million round and is plotting growth.
Finmark, which develops financial modeling software for startups, raised $6.5 million in strategic seed financing from American Express Ventures (AmEx). AmEx joins a coalition of backers that includes Draper and Associates, Bessemer Venture Partners and Durham’s Idea Fund Partners, bringing the startup’s total seed haul to more than $11 million, according to the company.
Financial details were not disclosed, though Finmark CEO Rami Essaid confirms he is “still very much in it,” having retained his majority equity holdings in the deal.
AmEx actually reached out to Essaid’s team directly last fall with a thesis around Finmark’s business model. At Finmark, the goal is to help companies understand their money better, and, as Essaid explained it, AmEx saw the value proposition for its own business. AmEx is in the process of giving people money – and if their companies manage their money better, AmEx benefits by being the source of those dollars, Essaid said.
“Lots of Zoom calls” later and a deal was formed, one that gives Finmark enough cash runway to take it into next year.
Finmark, founded in the midst of the pandemic, has 34 employees. With the latest raise, the plan is to build out its sales force, adding four to five people.
The plan is to pursue a Series A round mid-year and, if it’s successful, to work toward doubling the head count, Essaid said. In the meantime, building a sales team is the priority.
The firm has started to raise the stakes in terms of its customers. It’s doing bigger deals, selling into companies at $10 million and above. When it’s a $25 deal, “you can’t justify hiring sales," Essaid said. But when it’s a $10 million deal? It’s time to scale up, he said. And those hires will be made remotely.
Finmark is a remote-first company, and plans to stay that way “for the foreseeable future,” Essaid said.
Finmark, recently named among the 22 Startups to Watch in the Triangle for 2022, was founded in 2020, closing on its initial $5 million funder within its first five months. Essaid’s pedigree from his last company, security software firm Distil Networks, is part of the reason why, investors have said. Distil was acquired by Imperva in 2019.
