Here is another example of a piece on the transition over to B2B automation, which appears in TechCrunch. The startup is called Topi and it is based in Berlin. There are several other companies with the same name if one is looking at startups. In this company, the goal is to deliver better e-commerce payment solutions for businesses at the time of checkout in B2B scenarios. The announcement indicates that Topi received $4.5 million in seed funding led by a couple of VC firms and some angel investors.
‘And yet, B2B transactions haven’t changed as much. Businesses often face a simple dilemma — they pay directly or they spend some time negotiating a financing offer. A supplier can offer some financing options directly. Sometimes companies ask their bank directly. In all cases, it’s a lengthy, bureaucratic and manual process…
Topi wants to reach the ideal Venn diagram of B2B payments — a payment solution that doesn’t require any paperwork, but a payment method with some financing offers. Topi thinks it can offer financing options of up to five years with instant approval…
“We’re building all of that ourselves. We’re building the first product right now and it’ll come on the market during the course of next year,” co-founder Estelle Merle told me.’
So, this sounds a lot like working capital lending or supply chain finance, which is certainly a welcome thing across the board but even more so in the SME space. We did not receive a briefing so it’s not exactly clear who Topi would be targeting specifically. However, the additional level of risk for SMBs was mentioned in the article so we assume that is the primary audience that the solution would benefit, with B2B merchants expanding their flexibility for buyer financing choices. As one reads through, there are longer term potential business opportunities as well, with expanded financial product offerings.
‘When you look further down the road, Topi’s vision goes beyond simplifying payments. If the startup manages to become an important brick in B2B transactions, companies who use Topi could end up spending a lot of time on Topi’s portal. They could see upcoming payments and manage early repayments…
But Topi’s portal could also become a SaaS product on its own. For instance, customers could choose insurance products from Topi directly. Once you control the customer relationship, there are a lot of possibilities to expand horizontally. And Topi is well aware of that opportunity.’
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group
