Small-business challenger bank BlueVine raises $102.5 million

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BlueVine, a challenger bank that serves small businesses, said Tuesday that it has raised $102.5 million from a number of investors including CitiVentures, SVB Capital and a Microsoft affiliate.

The company belongs to a crop of fintech startups trying to provide a better deal for small businesses. Rho, Wise and Joust are also in that group.

BlueVine is trying to stand out by building an end-to-end banking platform that offers every financial product a small-business owner might want, CEO Eyal Lifshitz says. It offers loans, lines of credit and invoice factoring with partner Celtic Bank and a checking account with partner The Bancorp Bank that will be rolled out nationwide in 2020.

BlueVine's checking accounts will be free, but it will charge a fee for outgoing wires. It also will pay 1% interest on deposits. Customers are said to be able to sign up for checking accounts online within 60 seconds. BlueVine accounts will be compatible with accounting software programs that small businesses use like Quickbooks and Xero.

“Small businesses often don’t get the types of financial services large corporations get,” Lifshitz said. “Our mission is to give them access to these services. In addition, we believe that all these services should live under one roof.”

The company says it has provided more than 20,000 small-business owners with access to more than $2.5 billion in financing since it began in 2013. Underwriting decisions for the term loan and line of credit are automated and typically made in 90 seconds. The funds arrive in the customer’s account within 10 minutes, the company says.

BlueVine is targeting businesses with two to 15 employees — restaurants, doctors, dentists and the like.

Lifshitz wants to integrate credit, payments and cash management services. So, for instance, if small-business owners draw from their lines of credit, the money instantly appears in their checking accounts; they don’t have to wait for an ACH or wire.

“Now they’re hitting refresh every hour to see if their money is coming in — they’re nervous to see if they can meet payroll,” he said. “Wouldn’t it be great if you could have all of this in one account, press a button, drop in your line of credit and instantly it’s in your account?”

He also wants to give small-business owners a holistic view of their financial situations, so they can see their bank accounts, loans and payments in one place.

The Series F funding round was led by ION Crossover Partners with participation from all of BlueVine's major existing investors, including Citi Ventures, Lightspeed Venture Partners, Menlo Ventures, 83North, SVB Capital, Nationwide, M12 (Microsoft’s venture fund) and private investors. The round also includeed new investors MUFG Innovation Partners, O.G. Tech, Vintage Investment Partners, ION Group, Maor Investments and additional private investors.

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Small business Small business lending Small business accounting software Disruptors Fintech BlueVine