Fundid Works With SMBs Who Aren’t Served by Startups Like Ramp, Brex

• Fundid offers credit and lending tools to “micro businesses” with 10 or fewer employees.
• Founder Stefanie Sample aims to help women-owned businesses access capital and develop knowledge.
• See the 12 slides Sample used to raise $3.25 million in seed funding here.

Startups aiming to simplify the often-complex world of corporate cards have boomed in recent years.

Business-finance management startup Brex was last valued at $12.3 billion after raising $300 million last year. Startup card provider Ramp announced an $8.1 billion valuation in March after growing its revenue nearly 10x in 2021. Divvy, a small business card provider, was acquired by Bill.com in May 2021 for approximately $2.5 billion.

But despite how hot the market has gotten, Stefanie Sample said she ended up working in the space by accident. 

Sample is the founder and CEO of Fundid, a new fintech that provides credit and lending products to small businesses.

This May, Fundid announced a $3.25 million seed round led by Nevcaut Ventures. Additional investors include the Artemis Fund and Builders and Backers. The funding announcement capped off the company’s first year: Sample introduced the Fundid concept in April 2021, launched its website in May, and began raising capital in August.

“I never meant to do Fundid,” Sample told Insider. “I never meant to do something that was venture-backed.”

Sample lives in Missoula, Montana, and has been surrounded by entrepreneurship for more than 15 years. Sample’s first business was bags created from marathon and triathlon memorabilia. She maxed out her personal credit card to pay for a booth at the Las Vegas Marathon expo, where the bags were a hit. 

Sample had caught the entrepreneurship bug. “I just loved this idea of small business ownership,” she said.

Fundid fills a gap in the market

Over the years, Sample noticed that as her friends started businesses of their own, they often struggled to access capital and funding. When the COVID-19 pandemic hit, she researched why she was seeing news reports of women- and minority-owned businesses struggling to access Paycheck Protection Program loans. 

“I really went down this rabbit hole on this topic of small-business financing during the pandemic,” she said.

Sample’s rabbit hole led her to a niche she says has yet to be addressed by the high-flying corporate-card startups. Fundid’s target customer is a business with 10 or fewer employees, a group Sample says makes up a significant portion of the market but has few solutions that adequately address their needs.

“The reason we’re focused on this segment is when I was really trying to figure out how to get women business owners capital, I realized that 98% of all women-owned businesses have less than 10 employees,” she said.

Fundid offers three main solutions to small businesses: a marketplace that allows business owners to more easily find and apply for grants, a lending product launched in April that offers what Sample calls “microloans,” and a business credit card that will launch later this summer. The card is based on business performance, is unsecured, and does not require a personal guarantee or

credit score

.

Fundid makes money through interchange fees on the business card and through interest on the loans it offers.

Sample says that the grant search tool was key to Fundid successfully attracting investors. Although Sample didn’t have previous finance experience, she used her marketing background to design the grant search to attract potential customers and demonstrate demand to potential backers.

“I really leaned into that, especially with the grant match program,” Sample said of her past experience. “We set that up, in a lot of ways, to prove to the venture investors that we are capable of efficiently attracting our customer base and that we speak their language.”

Over 7,000 businesses have already joined Fundid’s waitlist for its corporate card after using the grant search tool and without any other marketing efforts, Sample said.

Sample and Fundid are also using feedback from customer surveys to inform the its roadmap and future products. Sample said that 76% of survey respondents indicated they don’t have access to funding for their business and don’t know how to get it. 

The survey responses also indicated that business owners weren’t necessarily looking for large lines of credit in a lending product. What they really needed was a product that could help them smooth out their cash flow as they grew their businesses and brought on new employees and clients. Fundid’s lending product is available to businesses that have annual revenues as low as $50,000. 

Fundid also seeks to help business owners answer questions they might have through content on its website. Topics include tips for writing grant proposals, how to compare interest rates on different types of loans, and different uses for loan financing.

“The most overwhelming part of being a small business owner is that you’re just all of a sudden supposed to know all of this stuff that you definitely didn’t know the day before, like what the heck an EIN number is, how filing taxes work, that being a sole proprietor means that you have to pay taxes quarterly,” Sample said of Fundid’s decision to develop content in addition to its financial products. “We really try to simplify all of that and understand how business finance works, in addition to accessing capital.”  

See the 12 slides Fundid used to raise $3.25 million in seed funding here.