Tebi Raises €30M Led by Google's CapitalG - Fintech News

Adyen Co-founder Launches New Fintech Venture, Tebi

Despite Adyen, the Dutch payments company, achieving a market capitalization exceeding $61 billion, its co-founder, Arnout Schuijff, departed in 2021. His reason for leaving was to dedicate himself to a new entrepreneurial endeavor: Tebi.

Currently operating as an Amsterdam-based fintech startup with a team of 35, Tebi provides a comprehensive, subscription-based platform for businesses in the hospitality sector. This platform streamlines operations by integrating payments, reservation management, inventory control, and other essential functions.

The market for such solutions is competitive, encompassing POS systems, reservation platforms, and analytics tools for inventory optimization. However, Tebi aims to differentiate itself by offering enterprise-grade functionality alongside accessible pricing.

A Logical Progression

Some might assume Adyen could have developed a similar product. However, Schuijff explained that focusing on small and medium-sized businesses (SMBs) was more effectively pursued outside of Adyen’s core enterprise focus. He stated that building for SMBs represented a more sensible course of action.

It’s important to note that Tebi wasn’t created to fill a void left by Adyen, nor was it intended as a new career path for Schuijff, who remained CTO after Adyen’s 2018 IPO. He clarified that his decision was driven by a positive impulse. “I was genuinely enjoying my previous role,” he stated.

The impetus for Tebi’s creation stemmed from Schuijff’s desire to code again. During the COVID-19 lockdown, he revisited an idea to simplify value-added tax (VAT) and reporting processes for a local bar he frequented.

Technologically, this project mirrored an accounting platform he previously built for Adyen, and before that, for Bibit, which was acquired by Worldpay (then owned by RBS) in 2004. However, by 2020, Schuijff had access to more advanced tools. The ability to support instant transaction updates through streaming technology particularly captivated him.

From Side Project to Established Company

While not yet a requirement in the Netherlands, Schuijff anticipates a trend towards tax authorities demanding real-time reporting of sales from hospitality businesses. More broadly, he recognized the need to reduce manual reconciliation efforts. This observation was validated by Mazdak Nasori, a bar owner who became one of Tebi’s five co-founders.

Schuijff informed Adyen CEO Pieter van der Does of his intention to dedicate himself fully to Tebi. His ambition, however, wasn’t to replicate the success of Bibit or Adyen. He expressed his inspiration from the coding process and the opportunity to positively impact local business owners.

Interestingly, Schuijff’s role as Tebi’s CEO involves less direct programming. He acknowledges missing the coding aspect but recognizes that he can contribute more value by focusing on leadership responsibilities, such as team building, strategy development, and other crucial aspects of running a company.

Schuijff actively seeks feedback from business owners during his personal time, discussing their challenges and introducing them to Tebi. He views these interactions as a valuable service.

Fueling Expansion

Tebi initially adopted a hyperlocal deployment strategy and is now available throughout the Netherlands. Merchants on the platform are reportedly processing nine-figure payments annually. With open positions in Amsterdam and London, and plans to double its workforce by year-end, the company is preparing to enter the U.K. market, with further international expansion planned for the coming years.

This expansion will be supported by new funding. Following a €20 million Series A round led by Index Ventures (approximately $22 million) eight months ago, Tebi has secured an additional €30 million (approximately $34 million) in investment. CapitalG, Alphabet’s growth fund, led this round, with participation from Index Ventures, bringing the total funding to €56 million (around $64 million).

CapitalG partner Alex Nichols, based in San Francisco, is known for his thesis-driven investment approach and focus on the European market. He recently invested in Belgian startup Odoo, adding to a portfolio that includes Monzo and Pennylane. He identified Tebi after observing the underserved nature of the European SMB market by expensive, bank-centric payment solutions.

Nichols noted that the European market mirrors the U.S. market from 15 years ago, before software-embedded payments significantly reduced the market share of traditional banks.

Schuijff emphasized that Nichols’ thorough research and the potential synergies between Tebi and Alphabet’s products – including Android, Gemini, Google Cloud, and Google Maps – were key factors in securing the investment. “We weren’t actively seeking funding, but we recognized the added value CapitalG brought beyond just capital,” he said.

The new funding will support not only international expansion but also the integration of more artificial intelligence features. Tebi has already implemented AI for onboarding, automating the extraction of menu information, visual identity, and reservation settings. Schuijff envisions an AI platform that will further enhance business operations for Tebi’s clients.

Expanding across Europe and developing this vision will require significant effort. However, once Tebi establishes a strong market position, a U.S. expansion is anticipated.