PayEm Looks to Expand After Securing $220M
Spend management firm PayEm says it has received $220 million in equity and credit financing.
“Our new warehouse credit will allow us to continue to grow our credit card operation and support our customers’ payment needs across the globe,” the company said on its blog Wednesday (Jan. 25).
CEO Itamar Jobani expanded on the $220 million — $200 million in credit and a $20 million Series A equity round — in an interview with TechCrunch, saying the funds would also help the company serve larger customers and improve its core product.
He told TechCrunch the company’s choice to raise debt instead of equity was a matter of timing and flexibility. The company went with warehouse lending, with its lender setting up a facility that PayEm can access and seed loan origination of its own, the TechCrunch report said.
“A credit warehouse facility is a tool perfectly structured to support our customers’ payments activity and provide them with monthly payment terms in order for them to keep their businesses flowing as our business continues to grow,” Jobani said. “The size of this credit raising reflects the growing volume of monthly transactions on the PayEm platform.”
Founded in 2019 and based in San Francisco, PayEm offers reimbursement, procurement, accounts payable (AP) automation and credit card tools in one centralized platform, PYMNTS wrote in 2021 after the company raised $27 million.
The need for such a platform has been fueled by a paradigm shift that has added new complexities for finance teams, the company said at the time.
“It used to be that major spend decisions were made by procurement and finance teams,” PYMNTS wrote. “Now, however, decision-making with regard to vendors, Software-as-a-Service (SaaS) platforms, and more are delegated to teams throughout the organization.”
Meanwhile, recent research by PYMNTS shows increasing demand for spend management systems among SaaS companies.
“Improving Financial Performance: The Speed of Spend Management System Adoption,” a PYMNTS and Airbase collaboration, found nearly two-thirds of SaaS firms not now using automation for non-payroll spending are eager to adopt the technology.
Bigger companies and those providing content management systems (CMSs) are the most likely to use a non-payroll spend management system and are highly interested in using one.
“SaaS firms that have not adopted non-payroll spend management software express interest in rectifying the oversight,” the study said. “Eighty-four percent would be at least somewhat interested in using one, and 90% of these firms are at least somewhat willing to pay for it.”