In the final batch to launch the Y Combinator, Peakflo stood out at TechCrunch. The company’s simple hire — Bill.com in Southeast Asia — fits neatly into the world’s broader narrative, digitizing its workflows more and more, and the hot market we saw for fintech companies in general.
At the time, we noted that “large revenues can be found to help companies spend and receive money,” Peakflo was probably “ready to collect,” with recurring monthly revenues (MRR) reaching $ 13,000.
So when Peakflo received some news for the fundraiser, we took the call. I spoke with founder and CEO Saurabh Chauhan about Peakflo’s fundraising, historical growth, its new capital plans, and revenue goals.
The world versus Excel
If I were to ask you which software product is the most essential for the global economy, what would be your answer? My belief is that Excel is a Microsoft spreadsheet application that takes a longer time than the modern Internet, and let’s be clear that it takes longer than your scribe to survive. On the same subject : Changing lifestyle to improve consumption of oral medical food products likely to top US$11 billion by 2032: Fact.MR study.
Why? Because so many companies are running business processes in Excel (or Sheets, nowadays), it’s a multi-faceted business tool. But as anyone who has tried to use a multi-ool, such as checking to mount anything with more than one screw, is often better off building something for a specific use case if you want to move it faster.
Enter the Peakflo market in Southeast Asia, where many businesses are taking the tools for spreadsheets that they use to record their payments and outbound invoices. The CFO suite was a Microsoft Office license, I think. Things have changed.
Chauhan estimated that 99% of his company’s customers come from Excel-like environments, which means that as Peakflo grows, it essentially acts as a barometer of the pace of digital transformation in its target market.
Like Bill.com, Peakflo allows companies to pay bills and send invoices. In terms of product, Peakflo is a collection of services for each Chauhan, including accounts receivable (cash), accounts payable (cash outflow), payment layer and integration layer, linking the service to accounting software and business resource planning. All of this requires work to build and maintain, which is to hire Peakflok, you guessed it, to use its new capital.
How much money has the startup raised? Chauhan said he raised “almost” $ 1 million when it was founded in 2021, and another $ 500,000 from Y Combinator during that period of his life. The rest of the $ 4.1 million that Peakflow has raised so far came later, with the round closing a few weeks back. Selected from its list of investors, in addition to accelerator support, Peakflok has attracted capital from the Rebel Fund, Soma Capital, Amino Capital and others, including a number of active individual investors, called angel investors.
Why put so much capital into so many different investors in a startup that is building in a sector that has had a reduced valuation profile in recent months? Growth, I think. According to Chauhan, since its Y Combinator era, Peakflok has added between 10 and 15 customers a month, and now counts more than 50. With a recently expanded sales function, the company expects to reach 100 next month and reach $ 1 million annually. recurrent income (ARR) in early 2023.
With fresh capital, a hiring plan, and a large market to attack, we set the countdown to that ARR threshold.
Gross margins
Before you go, let’s talk a little more about pricing and margins. You would say we mentioned a payment layer. See the article : Uncertainty in real estate is inevitable. Use these tips to keep going. If you’ve been watching the SaaS market in recent years, your ears should be a bit raised at that point. Will Peakflo grow not only with its software revenues but also with its transaction volume? After all, the model has become popular.
The answer, as I can tell, is what it is. According to the CEO of the startup, the company can achieve a gross margin of about 85% on its software products, but something similar to 40% in the area of payments. As Peakflo scales the cost of its software to its payment volume, it scales twice as much as more customer activity, but its gross margin differential reveals why the software is such a valuable business category.
More when Peakflo plays the seven-digit ARR.
