A Utah startup that keeps a safe distance from the 'noise' of Silicon Valley just raised $200 million in its third funding round in a year
- Divvy, a platform for tracking business expenses, closed $200 million in Series C funding Tuesday.
- NEA led the round, the company's third in less than a year. It has raised $245.5 million since 2017. Existing investors Pelion Venture Partners and Insight Venture Partners also participated in Tuesday's round.
- The company has added 3,000 business partners on its platform since January 2018 and is adding "hundreds more every month," Divvy cofounder and CEO Blake Murray told Business Insider.
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Call it the Salesforce effect.
Although corporate expense account tools don't typically generate the same buzz or excitement as consumer apps, Salesforce's success in the enterprise business has inspired a new generation of enterprise startups - and a frenzy of investment.
On Tuesday Divvy, a business expense management platform, announced it had closed $200 million in Series C funding led by NEA. This is the startup's third financing round in less than a year.
"Our design wasn't to grow as fast as we can and raise a ton of venture capital," Divvy cofounder and CEO Blake Murray told Business Insider. "We wanted to ride it out and see where it could go, but it became a deluge of venture groups saying 'holy cow look what you guys have built.'"
Divvy did not disclose the company's valuation in the latest funding.
The three-year old Utah-based startup allows businesses to track expenses in real time, and offers a credit card product to customers. Brex, another buzzy business credit card startup, has also enjoyed skyrocketing success and piqued investors' interest in a field long dominated by American Express.
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NEA's General Managing Director Scott Sandell will join Divvy's board of directors as its third member alongside Jeff Lieberman of Insight Partners and Ben Lambert from Pelion Venture Partners. According to Crunchbase, Divvy closed $250 million in debt financing in January. Divvy's funding round did not include debt financing, according to a source familiar with the deal.
A safe distance from Silicon Valley
According to Murray, Divvy has added 3,000 business partners to its platform since launching publicly in January 2018 and is adding "hundreds more every month."
The platform lets businesses track and analyze business expenses in close to real time, something Murray said sets Divvy apart from more traditional business expense trackers. Businesses with the Divvy credit card can set budgets for teams and quickly approve purchases as they come in instead of reviewing all expenses at the end of the month.
Murray says that staying out of Silicon Valley has helped his team avoid the "noise" of fast growth and influx of venture capital, and hopes that staying a safe distance away from the West coast will help his team of 200 avoid "getting out ahead of their skis" in their next phase of growth. Murray says the new funds will help the team "invest and reinvest" in product development and engineering, with modest hiring increases to help the platform grow beyond its flagship credit card offering.
"The reason why there's not a lot of friction is because we are solving need-to-have problems with need-to-have software, not nice to haves," Murray said.
Customers will "use you and dump you if you're are just solving nice-to-have problems with cool features."