Based out of Amsterdam, Factris provides an online invoice factoring platform for European SMEs. The company aims to take care of invoice-related aspects so that entrepreneurs can focus on the growth of their business.
Recently, the fintech company has taken over the factoring portfolios of the Dutch factoring company Payfix. This acquisition marks another milestone for the Dutch company as it aims to become the biggest company in accounts financing and services.
It’s worth noting that Factris was able to acquire the portfolio and provide services to the factoring companies thanks to recent funding – a 5 MM EUR funding deal struck last month with the private debt fund Dexteritas and partnering for 50 MM EUR with the asset manager NN IP in Q3 of 2020. The Dutch company will now use their financing method on the newly-acquired invoices from the five factoring portfolios.
What is Factoring?
Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. A business will sometimes factor its receivable assets to meet its present and immediate cash needs.
Factris, in their official blog, says, “In our type of factoring, the operation is represented by the issuance and acceptance of an invoice that we buy in part or whole within 24 hours. As the owner of the invoice, we manage the collection and insurance for factoring a fee that is paid up front as a small discount on the face value of the invoice, starting from 0.5 percent.”
How does this partnership benefit Factris?
The portfolios contain invoices that Factris will use to finance the SMEs to whom the invoices belong. This takes place when an SME “factors” an unpaid invoice by selling the invoice to Factris for a small fee, thus quickly converting their debt into working capital.
Factris then pursues payment for the unpaid invoice that they recently purchased. The portfolios will add significant value to the fintech, allowing them to acquire Special Purpose Vehicle (SPV) funding at a lower price range.
Factris’ CEO Brian Reaves sees this next step is essential in helping SMEs across the EU. Comments Reaves, “We are providing our financing infrastructure on commercial terms to help factoring companies finance SMEs with the benefit of our technology, risk management, and funding at scale.”
Acquired Debifo in 2019
Back in 2019, Factris acquired Debifo, a working capital provider in Lithuania for an undisclosed amount. During the acquisition, DEBIFO had 35 percent of the market share in the alternative finance market.
Founded by Brice Laurent, and Marcel Meijer in 2017, Factris was named the 2020 SME Working Capital Provider of the Year by the Prestige Awards and Best European SME Financing Specialist 2021 award by the CV Magazine.
To date, Factris has secured a total funding of €62.9M from investors including Speedinvest, NNIP, AB Ventures, and Dexteritas Investment.