The Israeli startup provides a loan service for small and medium-sized businesses through which a $50,000 loan can be obtained in one minute
Israeli payments platform Behalf, which offers a unique loan solution for small businesses, announced on Tuesday that it had completed another financing round in which $27 million had been raised. Leading the round was Viola Growth with participation from existing investors, including Sequoia Capital, MissionOG, Spark Capital, and Vintage. The startup provides a special loan service for small businesses based on a direct connection with their suppliers. The capital raised in the round will enable Behalf to expand its sales and marketing efforts, and to develop new products.
A slightly different credit plan
Behalf’s credit model is different from ordinary credit: Instead of giving small businesses money, the company pays the businesses’ suppliers. Behalf gives its customers lines of credit ranging from $300 to $50,000 for up to 150 days. The company charges between $11 and $30 for each $1,000 it lends. As befits a startup, there is no need for a personal meeting or branches; the borrower just fills out a short questionnaire with four questions online. Within 60 seconds, the customer receives an estimate of the credit that the company will extend to them, and can select a suitable payments plan. As a result, businesses have no need to waste valuable time on cashing checks, and they can make purchases immediately (the borrower receives the payment within a day).
Brothers Benjy and Shai Feinberg founded Behalf in Ra’anana in 2011. The company raised $119 million just over a year ago from MissionOG, Maverick Ventures, Victory Park Capital, and previous investors Sequoia Capital and Spark Capital. Company headquarters are in New York, and Behalf also has an office in Tel Aviv.
Commenting on the financing round, CEO Benjy Feinberg said, “SMBs are the unsung heroes of the U.S. economy, producing nearly half of the U.S.’ goods and services, responsible for two out of every three new jobs created, and generating the majority of innovation in the process. Yet, they are severely constrained by lack of access to working capital and their financial needs are not a focus area for traditional banks. Behalf has a simple solution, driven by data and technology, that allows us to provide well-priced and flexible credit tools to help SMBs and their suppliers grow profitably.”