Jeff Bezos just invested in this company

September 10, 2015, 10:30 AM UTC
Photograph by Scott Eells — Getty Images

Fundbox, an online lending site for small businesses, announced a new round of funding Thursday, adding Amazon CEO Jeff Bezos and early Twitter investor Spark Capital as new investors.

Fundbox’s goal is simple: the company wants to help solve cash flow problems many small businesses face from delayed payments by clients and partners. According to a U.S. Bank study, 82% of small businesses fail due to poor cash management and lack of access to working capital.

Many small business invoices can take two to three months to be paid, leaving some companies short on cash to fund their operations. Business owners can connect their accounting to Fundbox including Intuit’s Quickbooks software to get automatic evaluations about their overall health.

Small businesses can borrow money from Fundbox for the amount of unpaid invoices. Money is typically transferred within one day.

Fundbox makes money by charging interest that ranges from 1% to 3% monthly, far higher than a bank loan. Founder and CEO Eyal Shinar explained that most customers pay FundBox back as soon as they receive the money from their clients. He added that businesses have an incentive to pay back funds early because they pay lower fees.

While Shinar declined to reveal exact revenue numbers, he said that the company has doubled revenue in each of the past seven quarters. He also said that the company has tens of thousands of paying customers, and just recently passed the 15 million invoices processed since premiering the service in 2013.

The online and alternative lending space has been drawing more investor interest lately. Credit Karma was just valued at $3 billion, and online lender Avant is also growing fast. It’s less certain, however, how these companies will perform on the public markets, as online lenders Lending Club and OnDeck (ONDK) have both seen their shares fluctuate in the past few months.

Fundbox raised $50 million in total from investors in this round, which also included actor Ashton Kutcher and Guy Oseary’s Sound Ventures, Khosla Ventures, and General Catalyst Partners.

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