Float Financial, which aims to be the Brex of Canada, lands US$48.5M Series B

Float Financial, an expense management and corporate card startup focused on the Canadian market, has raised $48.5 million in a Series B funding round.

The Toronto-based fintech compares itself to US-based fintech giants Brax And the ramp But said it’s different in that its sole focus is on Canadian SMBs, whose CEO and co-founder Rob Khazzam says “Canada’s banking has been neglected due to the monopolistic and difficult economic climate.”

Goldman Sachs led the growth equity financing, which included participation from OMERS Ventures, FJ Labs, Terralys and existing investor Garage Capital. This increase brings Float Financial’s total venture funding to US$92.6 million as of 2020. The company also raised a $36.9 million credit facility due in February 2024, which it is using to extend credit to customers.

The company declined to disclose the valuation, stating only that it was an “up round” from that US$30 million Series A Raised under the leadership of Tiger Global in November 2021.

While Khazzam declined to reveal hard revenue figures, he claimed that Float’s revenue has grown “50x” and total payout 45x since the Series A raise. It also says it has seen a 30-fold increase in assets under management, he added. The company is still not profitable.

Float launched its first product in May 2021 and is gradually expanding its offerings from corporate cards and expense management to include bill payments, high-yield accounts, accounts payable automation and virtual physical cards in both Canadian and US dollars. Jane Software, LumiQ, is among Knix’s 4,000 customers.

Khazzam dismissed what he described as “the talk in the media lately that Canadian businesses are not a good place to invest right now.”

“The landscape of Canadian SMBs is rich and diverse and full of potential,” he told TechCrunch. “At FLOAT, we understand that a uniquely Canadian approach is needed to address the needs of these businesses…our financial system must match the speed and ambition of Canadian businesses if we are to thrive locally and compete globally.”

Float plans to use its new capital to further expand its product offering and regional presence within Canada, as well as continue hiring.

OMERS Ventures partner Laura Lenz believes Float’s “ability to work within the Canadian regulatory framework and…understand the nuances of this market” is critical to its success.

“It takes someone intimately familiar with these nuances to be able to make a product that works,” he said. “As investors with strong Canadian roots, we know there is an urgent need for banking infrastructure that helps Canadian businesses keep pace with their US counterparts and remain competitive on the global stage.”

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