Early payment platform C2FO, which helps businesses boost their working capital finance has raised $200 million (Rs 1,420 Crore) in a round led by SoftBank Vision Fund. Existing investors including Temasek and Union Square Ventures also backed C2FO in the current round. While accounts receivable or factoring helps businesses particularly SMEs to tide over their cash flow issues by borrowing cash against their receivables or selling them to a company that will pay an amount equivalent to the invoice amount by selling it to a third party, C2FO removes the need to sell to a third party.
“Unlike factoring where suppliers have certain receivables from companies and they can sell them to the third party and convert that into cash, our platform removes the need for supplier to sell it to the third party and offer discounts to customers based on their unique needs,” Pradeep Gode, Senior VP and Country Head, India, C2FO told Financial Express Online. The company has seen 300 per cent growth rate in year-over-year adoption of its services from businesses in India even as the country has emerged as the fastest-growing market for C2FO’s online marketplace that helps businesses access working capital through early payments of invoices from customers, accounts receivable financing and other lending options.
C2FO partners with corporates and offer its platform “as a benefit for all its suppliers who can be SMEs and even large companies, said Gode. With the fastest-growing market, India is a major focus area for C2FO as the company is looking to raise headcount, invest in technology, partnerships, and local product development, according to Gode. The company is looking at “around $1-trillion kind of an opportunity in India. We are seeing up to 60-70 per cent penetration rate across some of our customer supply chain. So if we have a supply chain of 3,000 vendors, we are seeing 60-70 per cent suppliers adopting this technology. This is much higher than what we see in other markets in West including the US,” said Gode.
C2FO currently has over 100 customers globally out of which more than 30 are in India such as Emami, Asian Paints, Metro Cash & Carry etc. Globally, over 3 lakh businesses across 173 countries utilize C2FO and receive over $1 billion in funding every week. C2FO “offers a solution to an industry that has traditionally lacked cost-efficient alternatives for businesses of all sizes looking to free up cash quickly,” said Akshay Naheta, Managing Partner for SoftBank Investment Advisers.