B2B Investment Tracker, June 5-12

The B2B investment space was abuzz this past week with venture capitalists providing financial support to an array of industries, including eCommerce and alternative lending. But the biggest winners were Big Data and Software-as-a-Service, two industries that often collide when providing companies with high-tech ways to streamline operations and save costs.

Altogether, Big Data and SaaS startups secured $94.5 million from backers, with venture capitalists preparing millions more to support the sector.

A cool $14 million of that funding was nabbed by eFileCabinet, the SaaS provider that allows companies to digitize their documents. PYMNTS spoke with eFileCabinet President and CEO Mike Peterson, who reflected on how e-documents not only strengthen the organization and efficiency of the business flow, but allow enterprises to take advantage of cloud technology and data in ways companies may not have previously thought of.

“We have customers stating that what used to take 20 minutes for record search and retrieval has gone down to 12 seconds,” said Peterson. “This allows CMEs to reduce labor expenses, serve more customers with the same number of employees, attract and retain more customers based on their level of quality communication and service, and, ultimately, improve their image in the eyes of customers.”

While eFileCabinet allows SMEs to ditch the bulky file cabinet, it also offers customizable configurations for companies to get the most out of the solution, providing companies with “best practice” recommendations. “For example, we can provide industry guidance to all insurance offices on the best configuration of workflow and system usage to optimize their profits,” Peterson told PYMNTS, adding that eFileCabinet’s sophisticated technological tools mean corporate users can access new visibility and insight into operations from a device or desktop, using Big Data to accurately support a streamlined workflow and, ultimately, improve profits.

While Peterson said that he acknowledges SME’s perceived challenges of adopting solutions like eFileCabinet – including a reluctance to change, a lack of knowledge of ease-of-use, and cost concerns – he said that the SaaS solution offers benefits to small businesses that far outweigh the assumed burdens of adopting it. “When you are fast, high quality and easy-to-do business with,” he asked, “what small business owner doesn’t find that attractive?”

Peterson’s focus on the way cloud-based SaaS solutions can entirely overhaul SME operations for the better is not unique. Software developers have been touting the benefits of such services for years, and as enterprises catch on, so are investors.

In addition to eFileCabinet’s $14 million funding, announced Tuesday (June 9), California-based Talkdesk revealed the same day that its cloud technology call center SaaS solution secured its own $15 million in Series A funding. Venture capitalists DFJ and Storm Ventures led the round, reports said, which will be used by Talkdesk to strengthen its customer support capabilities and revamp its overall product. The call center SaaS integrates into businesses’ existing CRM applications, the company said, including Salesforce and Zoho tools.

The SaaS sector also saw a merger this past week. E-procurement service provider Hubwoo has reportedly recommended its investors to vote in favor of a $30 million acquisition of the company by competitor Perfect Commerce, based in the U.S. “The strength of Perfect’s source-to-pay applications, for both public as well as private sector, combined with Hubwoo’s catalogue management and network based process automation capabilities will be very positive,” said Hubwoo chairman and CEO Gregory Mark in favor of the takeover. According to Perfect Commerce, the company’s acquisition of Hubwoo’s customer portfolio will add to what it claims is already the world’s largest independent supplier network, according to reports. The company services more than 500,000 suppliers.

Big Data startups had a lucrative week, too.

In Israel, one Big Data startup is making headlines for its ability to use just one sever and one graphic processing unit accelerator to offer data processing services. On Monday (June 8), SQream Tech announced a $7.5 million Series B funding round, financial backing that experts say highlights the company’s potential to save companies massive amounts of money thanks to its data processing capabilities without the once-necessary infrastructure. According to reports, SQream’s SaaS platform can process 100 terabytes of data in near real-time. Blumberg Capital spearheaded the funding round, reports said, and SQream said it will use the backing to propel North American operations as it explores ways to apply its data analytics platform in an array of industries, including homeland security, Internet of Things and health care.

Two days later, on Wednesday (June 10), Lattice Engines revealed a $28 million Series D funding round for its predictive analytics tool, with backing led by VCs like River Cities Capital Funds and Piper Jaffray Merchant Banking. As businesses begin to embrace Big Data, service providers are tasked with not only providing Big Data aggregation and storage services, but with offering a way to make use of that data. According to Lattice CEO Shashi Upadhyay, the financial support in his business signals B2B corporations’ rising demand for more sophisticated Data-as-a-Service tools. “In the past decade there has been a massive shift in B2B marketing towards predictive solutions,” he recently told Forbes. “It’s no longer enough to be a modern marketer. It’s about being a predictive marketer. By leveraging Big Data and powerful analytics, B2B marketers today have the same power of prediction as consumer giants like Amazon and Netflix.”

In other B2B venture capitalist activity, investors placed support in the eCommerce and alternative lending spaces.

Japanese investors turned their attention to Indonesia this week as B2B eCommerce site Ralali snagged $2.5 million from various backers, including BEENOS Plaza, which noted the potential of Indonesia’s B2B eCommerce industry, reports said Monday. Ralali offers maintenance, repair and operational products to other businesses through its platform, launched in 2013. According to reports, the site presently attracts 300,000 visitors a month, with about half of them coming from a mobile device. Ralali CEO and founder Joseph Aditya told reporters that the financial backing will be used to expand its market share. “With the new fund and learning from major Internet player, we are excited to bring Ralali to the next level,” he said, adding that the investment will be used to boost the “seller/buyer acquisition effort” and to enter into markets in other countries.

Over in Australia, alternative lending startup Moula reported a $30 million Series A funding round led by Liberty Financial and NCN Investments, among other backers. While the backing will obviously be used as actual loans and to facilitate the lending process, reports said that Moula will also use the money to educate small business borrowers, particularly in an effort to assure corporate customers that their data is secure. “The marketing is about telling people we’re a reasonable lender, sensibly priced and there’s none of these fees typically associated with alternative lending” said co-founder and chief executive Aris Allegos in a recent interview with StartupSmart. According to reports, last month Moula turned over an average of $200,000 worth of loans every week, with the average loan coming in at about $30,000. Since then, the company has already seen significant growth, and recently experienced a week in which Moula processed more than $1 million in loans.

More Ahead

Even without making direct investments in the B2B space, VCs are getting ready for future contributions to startup funding rounds. OpenView Venture Partners, which focuses its investments in the B2B SaaS space, has reportedly struck a partnership with Startup Institute in an effort to increase diversity within the VC and startup communities. Reports published Thursday (June 11) said that Open View currently has about $700 million in capital, and the new tie-up will let Startup Institute gain access to Open View’s startup-supporting resources.

Also Thursday, iGan Partners revealed its new $50 million early stage VC fund, Canada-based Rowanwood Ventures Fund, Fund II. According to reports, the fund will focus on the B2B Software-as-a-Service and digital health markets, and investors are aiming to choose 10 pre-Series A and Series A businesses for their backing. Half of the funding has been raised so far, reports added.