Charlotte-based fintech unicorn AvidXchange has announced it has raised $260 million in equity capital as part of the company’s latest financing round. TPG Sixth Street Partners, an AvidXchange investor since 2015, led participation in the round.
When the company announced the round’s launch in December 2019, Reuters reported that it could push AvidXchange’s valuation over the $2 billion mark. The company attained unicorn status by reaching a $1 billion valuation in March 2019.
As a result of this new round, AvidXchange has raised more this brings total funding to more than $800 million over the company’s 20-year history. The new capital will fuel AvidXchange’s continued growth and plans to invest in solutions for both buyers and suppliers while reaching more middle-market customers.
“More than 60 percent of U.S. businesses still pay bills with paper checks, accounting for more than $2.7 trillion in administrative costs annually,” Michael Praeger, CEO and co-Founder of AvidXchange, said in a statement. “We’re shaping the future of the B2B payments industry by fundamentally changing the way businesses pay their bills, providing a single platform for AP and payments with the largest payments network for the middle market.”
AvidXchange’s platform automates accounts payable (AP) processes and workflows for middle-market companies. It helps companies submit orders to vendors and suppliers, as well as receive and pay invoices online. It also helps speed up the invoice process so that vendors can receive payment in a timelier fashion.
As Chief Growth Officer Dan Drees told Hypepotamus in April 2018, “You’ve got all those payment types and you’ve got all that paper and all that fraud risk — It’s just a problem for CFOs and controllers who really don’t want to spend their time on AP. They want to be thinking about how they’re managing their balance sheet and what their cash flow looks like. These things are a nuisance that we have to get off their plate.”
“The payment side is just a super important last step in that whole workflow.”
The funding round caps a banner year for the company.
In July, AvidXchange acquired BankTEL Systems, adding nearly 2,000 bank customers to its financial services vertical. In October, AvidXchange launched AvidPay and AvidInvoice for long-term healthcare and social services. The company also hired 175 new employees last year, bringing its total number of employees to more than 1,400 across seven offices. AvidXchange also plans to expand its headquarters to accommodate an additional 1,200 employees.
“AvidXchange is poised to win with a complete offering of invoice automation, payment automation and supply chain finance all in one platform,” Bo Stanley, Partner and Co-Head of Capital Solutions at TPG Sixth Street Partners, said in a statement.
“Their comprehensive solutions coupled with the power of the AvidPay Network gives them all the right tools to lead the market, and we are proud to be their long-term partner.”