Adfin, a new UK-based fintech startup, wants to help businesses get their invoices paid, no matter what. Founded by two fintech experts, the company started with a problem and built a product around it: the problem is that if you're set up as a sole trader, or a small company without someone dedicated to admin tasks, getting paid is still hard.
For small businesses and sole traders like lawyers, accountants, consultants and craftspeople, the process of getting paid for work typically involves sending an invoice with bank account details to your client. But you also need to track the receipt and reconcile it to ensure the money has been received. On top of that, the experience for your clients is often not great.
For repeat customers, you can try to set up direct debit, but such businesses may have a hard time convincing customers to take money directly from their bank accounts, and card payments often come with higher processing fees.
“The average consumer makes only 21 e-commerce purchases per year,” Adfin co-founder and CEO Tom Pope (pictured left), who previously worked at open banking startup Tink, which was acquired by Visa, told TechCrunch. “E-commerce is all the hype, but at the average law or accounting firm, payments are still in the '90s: bank transfers, card payments over the phone, paying very high fees.”
Adfin argues that solopreneurs and SMEs don't necessarily want to think about the best way to get paid — they just want to get paid and move on. The startup is building an invoice management and payments platform to simplify crucial administration and ease the pain of payments.
After uploading invoices to Adfin, customers can use the platform to send payment requests via email, WhatsApp or SMS.
Adfin automatically decides which payment method to show depending on various factors, such as whether they're a repeat customer, if the invoice amount is small, etc. The company supports bank payments using Open Banking, as well as card payments such as Apple Pay and Google Pay. If a customer doesn't pay immediately, Adfin also automates sending reminders.
“Our customers are not payments geeks. They don't need to be payments geeks. And quite frankly, I think the fact that they're not payments geeks has probably led to them being taken advantage of a little bit,” Pope said.
“At Adfin, we just provide the payment. We take the payment and we handle the payment combination. And of course it's in our interest to make sure our clients have the highest success rate possible and keep their costs as low as possible,” he added.
Adfin acts as a central repository for all invoices, so businesses can check all pending invoices and see if they have been paid. Adfin currently charges 1% per payment, and it will always be 1%, regardless of which payment method was used.
“As merchants, everyone wants to get paid as quickly, as cheaply, and with as little hassle as possible,” Adfin co-founder and CTO Ciprian Diaconasu (pictured right), who previously worked at cloud-based banking platform Mambu for 12 years, told TechCrunch. “So what we're building is a set of capabilities that maximizes the timing of getting paid and minimizes the cost of doing so.”
The startup has already raised $4.9 million in seed funding, co-led by Index Ventures and Visionaries Club, with several business angels also participating in the round, including Thijn Lamers (Adyen founding team), Guillaume Pousaz (Checkout.com founder), Eugene Danilkis (Mambu co-founder), Ferdinand Meyer (Moss co-founder), David de Picciotto (Pledge co-founder), Maximilian Eber and Maik Wehmeyer (Taktile co-founders), and Josef Bovet (Tiller co-founder).