November 22, 2022
Happy Tuesday, Retail readers. Let's dive in.
🥘 Situational awareness: Our Place, the online brand with colorful, ceramic cookware, is cutting the ribbon on its first physical store in L.A. this week.
1 big thing: Balance gets $350M to help it extend credit to others
Balance, a B2B payments company, aims to ease e-commerce companies’ finance constraints with a $350 million facility from credit firm Viola Credit, CEO Bar Geron tells Kimberly exclusively.
Why it matters: At a time when financing is hard to come by, firms that help companies preserve working capital and keep operations running smoothly are in demand.
What’s happening: Balance’s new funding will help it expand its trade credit support to B2B merchants and marketplaces.
- The funding will also allow Balance to increase its financing capabilities and scale its net terms product.
Details: The revolving credit facility will allow its merchants to pay in 30-day payment terms and 60-day payment terms, Geron says.
- “It’s a short-term enabler for retailers to pay how they want in the time they need to pay,” he says.
Zoom in: Balance has seen strong demand for its term offering, Geron says.
- “Because the demand surpassed our funding in a significant way, we decided to partner with finance partners to just scale it to levels of billions of dollars a year because this is the incoming that we see,” he says.
How it works: Using Balance, merchants can pay their vendors through one platform, instantly, Geron says.
- Juggling various money channels at different times makes it difficult for merchants to manage and scale, Geron says.
- With Balance, “the retailers are getting all the flexibility they need from the offline space to pay online, self-serve.”
Zoom out: Demand has grown because “B2B that is moving online is becoming more and more sophisticated,” Geron says.
- “So we're seeing steel being sold online, we're seeing textiles selling online, we see chemicals being sold online,” he says.
Context: The company, which was founded in 2020 by PayPal alums Geron and Yoni Shuster, serves hundreds of B2B merchants.
- These include manufacturers, distributors and wholesalers that sell to retail businesses, as well as marketplaces, it says.
- It has raised $87 million to date, closing its Series B in July in a round led by Forerunner Ventures.
The bottom line: “I want it to be a no-brainer for B2B to be self-serve,” Geron says, adding “B2B payments should have the same level of experience as the consumer side.”