Rainforest, a startup that integrates payment processing into various software platforms, has secured $20 million in Series A funding, less than a year after announcing the completion of its seed financing.
While back-to-back funding rounds were more common in 2021, Rainforest’s rapid growth and success have attracted new investor Matrix Partners, along with existing backers like Accel, Infinity Ventures, BoxGroup, The Fintech Fund, Tech Square Ventures, and Ardent Venture Partners, bringing the total raised amount to $31.75 million.
Rainforest has experienced significant growth in the past six months, boasting a 17x increase in payment volume and onboarded “dozens” of platforms across various industries. The Atlanta-based startup, founded two years ago, has also seen a valuation growth of over 2x, albeit specific numbers remain undisclosed.
CEO and founder Joshua Silver describes Rainforest as a payments-as-a-service provider that assists software companies in establishing and refining embedded financial services tailored to meet the specific needs of SaaS firms. He emphasizes that Rainforest’s approach helps its clients maximize revenue while providing a service customized for SaaS companies.
Rainforest differentiates itself as a specialized alternative to providers like FIS, Fiserv, and Stripe, focusing on serving SaaS companies and offering personalized, superior service. Silver highlights the unique value proposition: “Software companies can increase revenue per customer by 2x-5x by adding fintech, earning more revenue from embedded finance than from their core product. But that’s only possible when it’s fueled the right way.”
With its platform geared towards software providers, Rainforest is capturing volume as platforms transition from legacy processors like Fiserv and FIS. It competes with companies like Stripe in embedding financial services and payments, catering specifically to the needs of mid-market software companies.
Rainforest operates a consumption-based revenue model, earning a small percentage of each transaction processed. Silver believes that the company’s transparent pricing, white-glove service, and focus on risk management and compliance are key factors in attracting and retaining customers.
The company’s recent success includes signing on CRM and marketing platform Keap, demonstrating its ability to serve large, established companies and compete effectively against industry giants.
Looking ahead, Rainforest plans to leverage its latest funding to enhance its product offerings and support services, with a focus on expanding into new verticals and providing innovative payment solutions.
In conclusion, Rainforest’s unique positioning in the payments space, combined with its tailored approach to serving software platforms, positions it well to tap into the significant market potential and emerging trends in embedded financial services.
