In 2016, Andrew Hoag, a former senior executive at Verisign and web project manager at NASA’s Ames Research Center, founded Teampay, a platform that attempts to automate the software purchasing process for businesses. Hoag’s idea is that the way companies spend their money is changing, especially as they embrace digital transformation, and visibility and control of spending are becoming increasingly important with these changes. ups and downs of the economy.

Looks like his thesis was correct. Today, Teampay has hundreds of customers and significant venture capital funding. This morning marks the closing of a $47 million Series B ($35.25 million, $11.75 million in debt) of the Fin Venture Capital-led firm with participation from Mastercard, Proof Ventures, Trestle and Espresso Capital, bringing Teampay’s total raised to $65 million. Hoag said the new money will be invested in expanding Teampay’s partnership with Mastercard and growing the company’s sales and marketing activities. Last year, Teampay launched a Mastercard-branded corporate card, Catalyst, with expense management features, signaling the startup’s intention to venture deeper into the hot corporate card space.

“Today, companies care more than ever about where every dollar goes, which requires a new perspective,”

“In today’s economic environment, Teampay’s software-led approach has proven resilient — as we saw in late 2020 to 2021, when the economy rebounds, Teampay benefits disproportionately through accelerated growth … We increased our debt facility for additional flexibility in uncertain times.”

“Enterprises crave control and visibility over the finances, and this not only helps the IT department, but [also] enables all departments to make better aligned business decisions,”

                                                                                                   Andrew Hoag, CEO, Teampay.

Teampay’s platform provides a workflow for employees to submit and approve expenses. Using it, managers can implement policies that automatically collect approval or disapproval of expenses belonging to certain categories. Teampay integrates with existing chat tools and provides real-time reporting, automates invoice processing, and offers virtual cards that can be limited by vendor and quantity.

In recent years, venture capitalists have poured money into enterprise expense management, lured by promises of low returns.

In January alone, European startup Moss, which provides credit cards to small and medium-sized businesses, raised $86 million. Spendesk raised $118 million in July 2021 for its enterprise expense management service. And in April, Ramp, which offers both business cards and expense-tracking software, secured $550 million in debt and $200 in equity at a valuation of $8.1 billion.

According to Dealroom, more than $2.8 billion was invested in enterprise expense management companies in 2021. This year, $1.6 billion was invested from January through May alone.

“Some teams are still stuck with a legacy, reactive mindset anchored on how businesses handled spending when purchasing was centralized,”

“With education and innovation, we look forward to bringing best-in-class ‘consumerized’ tools to the finance department.”

                                                                                            Andrew Hoag, CEO, Teampay.

Mastercard’s plans can be a bit vague, and Hoag is reluctant to disclose even a rough estimate of Teampay’s finances, including annual recurring revenue. But the total addressable market is certainly large enough to support more than one vendor – Grand View Research estimates its size at $15.9 billion by 2021.

In a smart industry analysis on Dealroom, Lorenzo Chiavarini writes that horizontal differentiation — for example, expanding into adjacent services like payment processing and targeting underserved segments — will play a key role in the management of the company. Some of this is already on Teampay’s roadmap, such as developing the company’s accounts payable solution and expanding its cross-border payment functionality.

The challenge, however, will be to stay motivated in the face of fierce competition from the likes of Brex, Divvy, and Bill. com-owned Airbase, and incumbents like Concur and Expensify. FinVC partner Peter Ackerson added in an emailed statement:

“We’ve seen Teampay’s significant traction and are excited to lead this Series B round. Spend management is still an outdated area and we believe Teampay’s platform is ideally positioned to be based on it. strategic importance in terms of long-term cost management for the CFO’s office.”

                                                                                               Andrew Hoag, CEO, Teampay.

Teampay, based in New York, now has more than 100 employees. The goal is to increase that number between 5% and 10% by year-end, Hoag said, averting unforeseen market turmoil.