Coast, a startup positioning itself as a “financial services platform for the future of transportation,” has successfully secured $40 million in Series B funding just four months after announcing a $25 million round, according to an exclusive report by TechCrunch.
Back-to-back fundraising rounds were common before and during the thriving investment landscape of 2021, but have become increasingly rare since the VC market downturn in 2022. This makes Coast’s recent funding achievement particularly noteworthy.
Based in New York, Coast positions itself against competitors like Ramp and Brex by offering expense management software tailored for fleet operators and their employees. Similar to other spend management companies, Coast has developed a commercial charge card specifically for businesses managing vehicle fleets, and this specialized focus has proven to be successful. Although Coast did not disclose specific revenue figures, CEO and founder Daniel Simon shared that the startup experienced significant growth, around “10x” in terms of annualized revenue and payment volume over the last 18 months. It’s worth noting that rapid growth could indicate a small initial base.
Coast boasts a customer base comprising “thousands of businesses” operating fleets in service sectors such as HVAC, plumbing, landscaping, pest control, construction, government fleets, and long-haul trucking. Some of these businesses have just a few fleet cards, while others possess over 1,000 cards. To date, Coast has issued more than 100,000 cards.
Leading the Series B funding round for Coast is ICONIQ Growth, with participation from existing investors Accel, Insight Partners, Vesey Ventures, and Avid Ventures, along with new investor Thomvest. Additionally, Synchrony made a separate “strategic investment” of an undisclosed amount in Coast, aligning with the financial services giant’s partnerships with major national tire and auto parts retailers like Discount Tire and Pep Boys.
Having raised nearly $100 million in equity since its inception in late 2020, Coast chose not to disclose its latest valuation. General Partner Yoonkee Sull from ICONIQ Growth now sits on Coast’s board of directors as part of the latest funding round.
“With our ambitious growth goals and an uncertain capital markets environment, it made sense to arm the company with additional capital,” said Simon.
Simon shared with TechCrunch that Coast continues to expand its presence among small and mid-sized businesses, with accelerated adoption of its expense management product for non-fuel use cases. Non-fuel usage has surged to over 30% of total spend in these new customer segments and is steadily growing.
Coast generates revenue by earning interchange fees from merchants when customers use the Coast card for purchases. It also charges customers a flat subscription fee of $4 per month per card actively used for payments in that month.
The company recently launched a mobile app to streamline receipt tracking, matching to job codes, and transaction verification for customers. Plans for the new capital include further product and partnership development, such as offering accounts payable automation and bill payment services.
Coast’s team has grown to around 65 employees, up from about 50 a year ago, with plans to expand to approximately 85 employees by the end of the year.
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