Left to right: 8fig co-founders Roei Yellin, Assaf Dagan and Yaron Shapira (contributed photo)
8fig, an innovative fintech startup, is creating a new way for ecommerce sellers to obtain financing as they go for inventory purchases, based on sales history and projected performance, has raised of $50 million in new funding to accelerate growth and expand its lending capabilities.
Investors include Battery Ventures, LocalGlobe, and Matt Robinson, serial entrepreneur and co-founder of Nested and GoCardless. Also, Silicon Valley Bank will provide a credit facility to enable 8fig to expand its funding capabilities to more ecommerce sellers.
Instead of a lump sum payment or an equity stake, 8fig’s technology optimizes a seller’s cash flow plan, injecting money as needed, claiming this process makes financing as much as 70% more cost effective than a traditional loan. Also, 8fig provides flexibility, allowing sellers to adjust their plan if they need to cancel a shipment or add a new one before the prior batch sells out, based on demand and inventory needs, to help avoid stock outs.
“Also, instead of funding one shipment of inventory at a time, which creates a cash flow crunch and limits growth, sellers can plan and fund parallel shipments of goods along with the logistics and marketing that goes with them,” said Roei Yellin, co-founder and CRO of 8fig, which has offices in Austin and Tel Aviv.
Yellin said he and co-founders Yaron Shapira (CEO) and Assaf Dagan (CTO) understand the credit and financing needs of sellers, especially those in the SMB category, functioning almost as anti-aggregators. Both Shapira and Dagan were executives at Qlarium, a secure international trading payment platform that DeltaCapita acquired in 2020; Yellin was part of Israeli fintech investor Prytek, which had a major stake in Qlarium.
“Those SMB sellers are often under-backed, not getting what they need from traditional sources of capital,” he said, adding the startup’s name reflects a goal of making six-figure sellers into eight-figure sellers. “Their needs are very different from other small businesses. So instead of exiting (through acquisition) we want to empower them, give them the ability to grow. When they do want to exit, they can do it when they’re not forced to sell because of no access to cash flow or other resources.”
Yellin said 8fig is a self-service tool, in which sellers answer questions on a planning page to map out their supply chain, inventory and other needs months ahead, based on the products they offer. Typical queries cover how much is needed to pay off manufacturers and vendors, and by when, and how much is needed to cover shipping, logistics, 3PLs and marketing costs.
“If a container is stuck in port, meaning they can’t sell that item, they can log into the 8fig platform, press a button and submit a change request,” he said. “Their cash flow plan is automatically adjusted without a change to the seller’s account.”
8fig claims it has seen 200% growth since its $6.5 million seed round six months ago, with hundreds of clients and close to $100 million in capital provided to sellers.