Countingup Secures £9.1 Million in Series A Funding

Countingup, a U.K.-based fintech company that provides a business current account integrated with accounting tools, has successfully completed a £9.1 million Series A investment round. Framework Venture Partners spearheaded the funding, with contributions from Gresham House Ventures, Sage, and existing stakeholders.

The prior investment from ING, coupled with Sage’s recent participation, is particularly significant. Both entities possess the potential to broaden Countingup’s reach to a larger base of business clients. This also potentially establishes a clear pathway for a future acquisition. However, it’s prudent to avoid premature speculation.

Company Overview and Vision

Established in 2017 by Tim Fouracre, the founder of cloud accounting platform Clear Books, Countingup currently serves over 34,000 business customers. The company aims to become the central financial hub for micro businesses, both within the U.K. and internationally.

Their initial strategy involved merging a business bank account with bookkeeping functionalities. This approach was designed to streamline account filing, addressing a common and time-consuming challenge for sole traders and small enterprises.

Key Features and Functionality

The platform offers a full-fledged business bank account, complete with a dedicated sort code and account number. It also includes a Mastercard for transactions and supports both faster payments and direct debits.

On the accounting front, Countingup provides automated bookkeeping, invoice creation, receipt management, bill payments, tax estimations, and profit and loss reporting.

Accountant Integration

Accountants can be granted restricted access through a web interface to assist clients utilizing Countingup. Business owners have the option to share real-time bookkeeping data with their accountants, thereby “removing the difficulties associated with re-authorization requests, data delays, duplication, and inaccuracies,” as stated by the fintech firm.

Future Plans and Team Expansion

Fouracre indicated that the newly acquired funds will be allocated to rapidly expand the team from its current size of 30 to 80 employees. This expansion will “accelerate our product development roadmap, allowing for concurrent progress across multiple product areas,” he explained.

The roadmap encompasses tax filing capabilities, the introduction of new financial services – such as loans and card payment processing – and support for multi-currency invoicing and payments. This will cater to the 33% of U.K. SMEs engaged in international trade. A web-based version of the application for small business users is also in development.

“We will also be strengthening our sales and marketing teams to pursue more aggressive growth strategies,” Fouracre added.

Revenue Model

Countingup operates on a dual revenue model, combining SaaS and fintech elements. Subscription fees are generated through the SaaS component, while the fintech side derives income from banking activities, including interchange fees on Mastercard transactions. Future revenue streams are anticipated to include offerings like credit, payments, and foreign exchange services.

Neal Watkins, EVP, Small Business Segment at Sage, commented: “Investing in rapidly growing SaaS businesses is central to our strategy of empowering small businesses and accountants to succeed. This represents an exciting opportunity to participate in a startup’s journey in a novel way as businesses explore the advantages of integrating accounting and financial services.”

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