UK-based start-up Codat has secured undisclosed strategic investments from PayPal Ventures and American Express Ventures.
Codat is building an API that connects with all the systems that hold all the relevant financial data.
The new investors join Codat’s existing investor Index Ventures, which invested in Series A financing round.
Founded in 2017, Codat powers the data ecosystem of the small and medium business by offering a critical data exchange between SMBs and the financial institutions and fintechs that caters to them.
Its API is designed to connect the tools and services that small businesses requires for their operations. It also facilitates the heavy lifting of integrations, allowing providers to focus on enhancing their offerings for small businesses.
Codat’s clients consists of insurers, lenders, providers working in payments, corporate cards, debt collection, point of sale software, venture capital, automation, and expense management.
Commenting on the development, Codat founder and CEO Peter Lord said: “We’re excited to welcome American Express Ventures and PayPal Ventures as investors to further our mission to make life easier for small businesses.
“It’s clear that small businesses are the backbone of global economies, and in the next few years, we believe there will be a dramatic acceleration in the quality of financial products they are offered. We believe it starts with an industry-wide shift from siloed data to a more connected ecosystem. Our new investors further fuel our ambition to improve operations for SMBs everywhere.”
In addition to the new investments, Codac also announced the launch its US operations.
Amex Ventures managing director Dana Eli-Lorch said: “Small businesses continue to seek more intuitive financial services solutions.
“Codat’s integrations have the potential to create value for financial providers, helping them deliver enhanced experiences and more efficient services for small and medium businesses.”
PayPal payments company Zettle, which serves SMBs, utilises Codat’s technology to transfer point of sale transaction data into their merchants’ accounting software.
PayPal Ventures’ Peter Sanborn commented: “Through Zettle’s integration with Codat, we have seen first-hand how Codat drives important efficiencies for our mutual customers.”
Sanborn added: “We’re excited to invest as Codat brings its solution to more businesses that are looking to streamline their data connectivity across multiple business software providers.”
In November last year, payments major Visa tapped Codat to offer its clients access to digital banking solutions and capabilities, and help them bring new solutions to market.