With a disruptive payment solution that is making sure SMEs get paid fairly and on time for their services and products, Aarhus-based Fellow Pay has just scored €325k in new funding, bringing the total raised to €2.5 million.
While there has been a lot of activity in the SME payment space, most of the action has focused on making payments more seamless for customers. Taking a different approach, Danish startup Fellow Pay is here to help ensure that SMEs get paid on time and in fair terms. The company has just raised an additional €325k bringing its total pre-seed funding to €2.5 million.
Founded by Christian Thisted and Jacob Pedersen in 2017, Fellow Pay was launched to address a growing problem – that SMEs too often struggle financially, or even close down, because of unfair payment terms from customers. SMEs should be able to take greater control over payments and retain more fluidity.
Christian Thisted explained: “We’re passionate about helping these companies that otherwise would not have access to financing and that do not want to use the traditional, unfair alternatives that already exist. This is what drives us.”
The problem the team want to solve is rooted in an imbalanced payment culture whereby companies demand up to 90 days’ payment deadlines when they buy services or products from other, often smaller, companies. This leaves a lot of SMEs in a position where they – unnecessarily – have to wait for a long time to get their payment and therefore are unable to grow as fast as they could and should. In the worst cases, these payment terms can even force companies to shut down.
So, to disrupt the market on the side of Europe’s SMEs, the Danish fintech has developed a fair, easy and innovative product that ensures any small business – regardless of its size – can get its invoice paid on the same day it is issued.
Christian added: “With the traction and the customer satisfaction we’re experiencing right now, it’s becoming more and more clear to us how big the need for our solution is. And when we combine that with the fact that we’re able to operate in 46 countries across borders, it’s hard not to dream big. We want to be the go-to place for companies all over the world when it comes to instant payments.”
Currently operating in 9 countries, the startup has already achieved notable attention for its solution. In 2020 it won Finance Forward, a fintech competition hosted by Village capital, MetLife Foundation and PayPal.
Putting this new funding to use, the team plans to expand further into new markets and grow the product to help SMEs across Europe make fairer payment terms.
