Spanish startup Finanzarel, which has developed a platform to allow companies to crowdfund their invoices, has announced that they have raised 700,000 euros in funding from undisclosed foreign VCs and local backers. The company tells me that this round, their first, will be dedicated towards improving the platform and boosting their marketing efforts.
As a part of the deal, Jose Maria Ayala, former chairman of the Official Credit Institute, will be joining the company’s board of directors.
The service allows companies to auction off their invoices to private investors, with Finanzarel generating revenue by taking 0.25% on each invoice monthly. The platform is primarily geared towards SMEs in need of working capital, offering them the ability to trade credits to investors (they explain the concept in greater detail, but you will, unfortunately, need to know Spanish or use Google Translate to get the entire picture).
The startup launched last year and reports that they have thus far received credit requests totalling 10 million euros.