Emergence Capital and Rally Ventures lead a $6.6 million funding round for JustiFi, an embedded fintech platform for platforms.
FREMONT, CA: Vertical software, by virtue of being purpose-built for distinct industry niches, limits the prospective market's size. Industry experts frequently build vertical SaaS tools. JustiFi, the intelligent finance orchestration platform for platforms, has completed a seed financing of $6.6 million. JustiFi equips vertical SaaS platforms with a comprehensive set of embedded financial technology tools that can be applied to their existing customer base.
"Fintech is complex, and payment teams are expensive and hard to secure, especially with other priorities like customer acquisition and new product features fighting for resources," states Joe Keeley, co-founder and CEO of JustiFi and founder and former CEO of CNST. "JustiFi's payment team and platform tools enable platforms to integrate fintech strategies early in their build without having to hire huge teams to support them."
Customers increasingly look to vertical SaaS platforms for extended capabilities, including payment and banking features, as they become the record system in their industry. Unfortunately, most vertical SaaS platforms lack the in-house expertise and engineering resources necessary to develop a fully integrated fintech suite of tools and thus deploy an amalgamation of integrations that are not optimized for customer happiness or revenue maximization.
When a vertical SaaS platform partners with JustiFi, they gain instant access to a fully integrated and white-labeled suite of payment acceptance tools, intelligent orchestration tools for multiple payment types, white-label insurance capabilities, lending capabilities, card issuing, and treasury management, among other capabilities. These tools are designed to be as cost-effective as possible, resulting in the best potential income and profit.
JustiFis decision engine analyses each transaction using artificial intelligence to dynamically optimize and lower payment costs to the lowest effective rate achievable at the interchange level. JustiFi becomes wiser over time as it applies its learnings, increasing its profitability. By 2020, the global internet economy will be worth upwards of $6.49 trillion, and firms will have spent more than $195 billion on payment processing fees alone.
Emergence Capital, an early investor in Zoom, Bill.com, Veeva, Salesforce, and other market-leading enterprise startups, and Rally Ventures, an early investor in Braze, Carbon Black, Coupa, and SportsEngine, co-led the round. The additional funding will expand the team and complete the product.
“JustiFi was created to democratize fintech and accelerate the revenue potential of SaaS platforms,” states Joe Floyd, general partner at Emergence Capital. "JustiFi was built by vertical SaaS veterans who won at the payments game before. Now, they're commercializing all of the industry leading insights, data, tools and technology they've developed over the last 15 years, so other platforms can win as well."
“To put it bluntly, we know that nearly every business in the world pays too much in payment processing fees. Those high fees are especially painful to vertical SaaS platforms, where gross margin is materially impacted by each basis point,” states Justin Kaufenberg, managing director at Rally Ventures and co-founder and former CEO of SportsEngine, a vertical SaaS platform that processed multiple billions per year in payments. “Offering payments is table stakes. Vertical SaaS platforms should not settle for anything less than a fully integrated, fully white label, comprehensive fintech stack that includes a native orchestration layer and transaction level cost optimization.”
