If you talk to a Fintech entrepreneur about your business, you are likely to end up talking about accounting problems at some point.
A larger book is a record of money movements that serve as a source of truth for financial assets, but when a company begins to have multiple bank accounts, payment processors and funds distributed in discrete services, it can become a headache for manage. Most companies end up dedicating engineering resources to build their own accounting books to solve that.
The formation of the French startup began trying to capitalize on this need with a programmable and open -source greater financial book that can track all the assets that enter and leave their accounts. Now, that product is serving as a spine for a broader and more ambitious infrastructure work.
“In 2024, and even before, we focus mainly on the biggest book. And then we begin to prepare to move from a single Ledger product to the formance platform with other modules: the reconciliation part, for example, connectors to payment services, etc. ”The co -founder and Cto Clément Salaün told britcommerce.
Formance currently offers five products: in addition to the biggest book, there is a connectivity platform to integrate financial suppliers using a single API; orchestrate payments to move money through wallets and payment suppliers; and reconciliation.
The startup is also working on a mass payment product for markets and other companies that need to issue payments. Developers can already administer payments through programming using Stripe, Adyen or Mangopay, but formance wants to build a middole that works in several suppliers.
The company recently raised a $ 21 million series A round directed by PayPal Ventures and Portage. Existing investors and Combinator, Hxton Ventures and Axeleo are also participating.
A platform
The startup believes that there is value in offering a modular platform that is similar to the Amazon Web Services version about cloud accommodation: customers can use a single service, but it is more efficient if it houses all their cloud infrastructure under the cloud under the same roof.
“We will launch several other modules, particularly related to financial operations,” said Salaün. “We will go further with exports for accounting tools. We are also going to improve connectivity one more step and we will go through the battery and work on the bank at a lower level. So we are really going to continue modularizing the entire battery. “
At the same time, the team wants to ensure that integration costs remain as low as possible for their customers if they wish to add another module.
“If you get three SAAS products to administer them, you will spend, I don’t know, $ 150,000 in the three products and $ 150,000 in internal glue to unite them,” said Salaün. “Financial infrastructure is really a ‘long tail of small problems’, each of which could be a company with $ 10 million in [annual recurring revenue] – Something like that. But it really is this platform game that can help us climb beyond that. “
Fintech companies as Stripe also offer many Fintech infrastructure services, but formance wants to remain independent. It does not process payments and does not have customer money.
The company states that it has about 20 clients, two of whom are in the USA., According to Salaün, these two clients represent 40% of the startup income. Their other clients include Booksy, Doctolib, Liberis and actions.
With the new $ 21 million in the bank, Formance plans to open an office in New York and hire a market team there. He also wants to develop his engineering and in -line products equipment with his goal of increasing his account of 20 to 50 employees at the end of 2025.