Factorial, the all-in-one business and HR management platform for SMBs globally raises €80M

Factorial, the worldwide SMBs’ one-stop shop for business and HR management, announced the completion of a €80 million go-to-market investment.

The funding comes from renowned US VC firm General Catalyst. This funding comes after Factorial became a unicorn in October 2022 when it raised a $120 million Series C that was oversubscribed and spearheaded by Atomico.

Being a SaaS company, Factorial usually pays upfront for marketing and customer acquisition. Even if the investment will pay off in the long run, Factorial will experience a short-term cash drain from it. Because General Catalyst bears the downside risk, Factorial can accelerate growth through its investment without negatively impacting its balance sheet or diluting current shareholders by using investment to finance a portion of those costs.

CEO and co-founder of Factorial Jordi Romero stated:

“We wanted to be able to maintain our growth trajectory without ever having an equity round because we are one of the fastest-growing software firms in Europe. We’re thrilled to have found General Catalyst as our partner. Moreover, we can concentrate on creating fantastic products and assisting more customers without worrying about fundraising. The fact that General Catalyst is among the most respected tech investors globally simplified the process. They are aware of the market and the caliber of the enterprise.”

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With this most recent funding round and the triple-digit millions held from Factorial’s successful 2022 Series C investment, the company is better positioned to continue on its current growth trajectory and maintain unheard-of balance sheet flexibility. Further, to protect equity, this financial support makes it possible to make calculated investments in engineering and product development. Consequently, Factorial can provide its clients with better products more quickly.

Pranav Singhvi, MD of General Catalyst, said:

“General Catalyst made the calculated decision to invest and accelerate the company’s go-to-market strategy after getting to know the Factorial team for many years and observing both their growth trajectory and the performance of their client cohorts. The move also fits with our goal of finding and funding creative projects that have a significant market impact.”

According to Factorial’s CFO Moran Laufer:

“We believe that Factorial’s access to money for sales and marketing is a game-changer. We will be able to effectively double the return on equity for our investors and ensure sustainable fast-paced growth by speeding up our customer acquisition efforts with General Catalyst.”

Luca Eisenstecken Partner of Atomico, who oversaw the previous Series C funding and became a board member of Factorial, said:

“This investment is a strong testament to the resilient, high-quality business, as well as GTM engine, Jordi, Bernat & the Factorial team are building and serves as additional validation of Factorial emerging as a category-leading European technology business.”

Image Credit: Factorial