Small business fintech Credit Shift has raised $27 million in fresh capital, led by Sequoia Capital Southeast Asia.
The 10-year-old fintech provides credit and payment platforms to help businesses trade, pay and access funds. It was formerly known as GetCapital, with renamed Shift in October 2021.
The company calls this a Series C. The new capital will be used to improve the company’s products.
Previously, in March 2020, it raised $10 million in a round it called a Series D, in addition to $100 million in new debt, including mezzanine financing.
Shift also raised $87.5 million in mezzanine financing from the Australian Business Securitization Fund in October 2021, establishing $500 million in warehouse financing at the time.
Past backers include former Macquarie Capital execs John Prendiville and Michael Carapiet, Pepper co-founder Patrick Tuttle, Singapore family office Alto partners and fund manager Challenger among 40 investors at the Sydney fintech table. The company said existing investors participated in the latest capital injection.
Sequoia’s acquisition of VC financing marks a shift in strategy for founder and CEO Jamie Osborn, a former director of Macquarie Bank, who in 2020 praised its lenders as “sophisticated, long-term investors” who provided “a significant competitive advantage” compared to VC shareholders “who often prioritize short-term growth and the departure of a shareholder over building a great company over the long term.”
Shift competes with the likes of ASX-listed Prospa and Judo Bank, offering small business loans between $10,000 and $1 million, depending on company revenue. The most popular product is the business overdraft, which charges 11.95% to 19.95% in interest.
The company says it has now provided more than $2 billion in funding to Australian businesses.
Osborn said Shift had performed strongly over the past three years.
“With this funding, we are well positioned to scale our business and enable growth for our partners and enterprise customers,” he said.
Rohit Agarwal, director of Sequoia Southeast Asia, said many businesses in Australia rely on mortgages on their homes or vehicles for credit financing.
“There is more than $3 trillion outstanding in corporate loans and more than 90% of that is backed by real estate or cars,” he said.
“Shift solves this by providing smart financial solutions – anytime, anywhere credit – to millions of companies using data and technology. ”