Pipe Technologies, the Los Angeles-based subscription financing platform, has announced it raised $60 million in equity and asset financing. This is an extension of its seed funding round led by Fin VC, and included new investors Tribe Capital, Uncorrelated Ventures, Anthemis, and Lachy Groom. Prior investors Craft Ventures, Fika Ventures, and MaC Ventures also joined the round.
While the global SaaS market was valued at almost $135 billion in 2018 - with that number set to grow - Pipe identified an issue blocking small SaaS startups from being competitive. Established in 2019 by Harry Hurst, Josh Mangel, and Zain Allarakhia, the company has empowered SaaS companies to receive instant liquidity on their subscription contracts as an alternative to equity financing. This method allows companies to access their money faster and can lead to immediate reinvestments, capturing new customers, and growing organizations more quickly.
"We believe Pipe's subscription finance platform will radically transform the global SaaS business model, providing liquidity that will generate a tidal wave of growth and innovation for SaaS companies and positioning subscription contracts as a new and highly valued asset class for global investors," said Peter Ackerson, Investment Partner at Fin VC.
While Pipe sets out to fundamentally disrupt how SaaS companies grow, $60 million is still a significantly large amount for a seed funding round. The company says it will use the funding to expand into new markets while keeping most of it liquid to finance Pipe's customer base.
Along with the funding round, Pipe announced the appointment of its new Chief Operating Officer and Chief Legal Officer, Michael Cieplinski. Cieplinski joins the company from LendingClub, where he was the Senior Vice President and General Counsel, managing the legal departments and overseeing partnerships, business strategy, payments, lending, and operations.
"Pipe has the opportunity to re-shape the entire cloud services industry with a completely new approach to how companies are funded and grow," said Cieplinski in a statement. "Pipe already offers a unique value proposition to the booming SaaS industry, but the vision is much bigger than the work Pipe is doing today. We've started with reimagining funding, but ultimately want to be a larger one-stop solution for SaaS services."