Utah startup Divvy announces one of state's largest funding rounds with $200M

Utah startup Divvy announces one of state's largest funding rounds with $200M

(Courtesy of Divvy)

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SALT LAKE CITY — Utah startup Divvy is just a year-and-a-half old, but the financial tech company has already made history in the Beehive State.

Affectionally dubbed “Venmo on steroids for business,” Divvy raised $200 million during its most recent funding round, making it one of the largest funding rounds in Utah history — along with Domo’s $200 million funding round in 2015.

Though Divvy is not releasing the official valuation the company received from the round, company executives did confirm that Divvy is currently worth between about $450 million and $600 million. The company has now raised a total of $245.5 million and generated over 30 percent of quarter-over-quarter revenue growth — with few signs of slowing down.

Divvy’s head count has skyrocketed from 30 employees in January 2018 to over 200 currently. When the company first launched its platform, it had only a handful customers but is now approaching 3,000.

“I’ve never been part of a company that has scaled as fast as Divvy from a customer perspective,” said Ben Lambert, a Divvy investor who led the company’s first funding round. “The potential is hard to explain. With Divvy, every single company can have the tools they need to manage their finances for free. Divvy is as much of a no-brainer for an investor as it is for potential clients.”

So what is Divvy?

For local entrepreneurs Alex Bean and Blake Murray, there was always a pain point in business that festered more often than the rest. Both had worked in the corporate world for years and experienced the tediousness and inefficiency of the end-of-the-month expense report.

“It killed me that while I'm sitting there reconciling our reports … those numbers functionally were changing across time,” Murray said.

While entrepreneurs could watch their business’ revenue change in real time thanks to a myriad of available software, the same couldn’t be said for company expenses. So Murray and Bean spent the next two years creating Divvy: an expense management platform that allows businesses to do away with expense reports entirely.

Divvy automates expense reports, allows companies to monitor their budget in real time, lets employees send and request funds in seconds, gives every employee a company card and provides virtual cards for business subscriptions and expenses. The platform essentially simplifies a process businesses often find necessary, but inefficient.

If an employee is taking a business trip, Divvy will track everything that employee is spending using the Divvy credit card and show it in real time on the platform. The card will have as much money on it as the company deems is necessary for the trip and will keep track to ensure the trip stays on budget.

If the employee needs more money, they can send a request which can be approved in seconds. Those with access can also track the budget for the month, all the way down to an individual's spending.

Oh, and the whole thing is free.

Divvy partners with banks who underwrite the credit for the businesses that use the platform, then when the expenses come across the Divvy platform, Divvy and the banks share the interchange.

What’s next?

Divvy is currently in the middle of launching new features they say customers have asked for, but the company is also building out its software and working more closely with banks.

“What’s happened over the last six months to a year is that banks have started to notice Divvy,” Bean said. “They know they can’t really build what we’re building, but we want to partner with them and let banks do what they do best while letting us do what we do best. … So you’re going to see us announce a lot more partnerships with banks over the coming year.”

Divvy also plans to be leaders of a new wave of financial technology, though it’ll have to focus intently on its product to remain competitive with the scores of other financial technology companies that are starting to disrupt the market as well.

"You’re kind of seeing categories being created and an industry being disrupted," said Sterling Snow, Divvy's vice president of marketing. "That’s part of a larger story that Divvy’s really excited to be at the forefront for years to come."

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