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Float Financial, an investment management and credit card startup targeting the Canadian market, has raised $48.5 million in Series B funding.
Toronto-based fintech compares itself to US fintech giants Brex and Ramp but he says it’s different because of its focus on Canadian SMBs, which CEO and co-founder Rob Khazzam said are “overlooked because of the stability of Canadian banks and the financial crisis.”
Goldman Sachs Growth Equity led the investment, which included participation from OMERS Ventures, FJ Labs, Teralys and former investor Garage Capital. The upgrade brings Float Financial’s total revenue to US$92.6 million since its 2020 launch. The company also raised a $36.9 million loan in February 2024, which it is using to expand credit to customers.
The company declined to disclose the price, saying only that it was “rounded” from its own US$30 million Series A ride led by Tiger Global in November 2021.
Although Khazzam declined to disclose hard funding figures, it says Float has seen its revenue increase by “50x” and total payout ratio by 45x since the Series A round. It also claims to have seen a 30x increase in the number of products being handled, he added. The company has yet to make a profit.
Float launched its first device in May 2021 and has been expanding its offerings from corporate cards and money management to include bill payments, savings accounts, accounts payable and physical cards in Canadian and US dollars. Jane Software, LumiQ, Knix are among its 4,000 customers.
Khazzam rejected what he described as “talk in the media recently that Canadian businesses are not a good place to invest here.”
“The Canadian SMB landscape is rich and diverse and full of potential,” he told TechCrunch. “At Float, we understand that addressing these business needs requires a Canadian approach… Our financial system must match the pace and ambition of Canadian businesses if we are to succeed locally and compete globally.”
Float plans to use its new headquarters to expand its offering and regional presence in Canada and continue to hire.
Laura Lenz, a partner at OMERS Ventures, believes that “Float’s ability to operate in accordance with Canadian law and…understand the complexities of this market” is critical to its success.
“It takes someone who knows these types of things to be able to make something that works,” he said. “As investors with strong Canadian roots, we know there is an urgent need for banks that help Canadian businesses keep pace with their US counterparts and remain globally competitive.”
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