Q&A With Apruve CEO Michael Noble On The $6m Series A Round



Minneapolis B2B Fintech Venture Apruve announced raising $6m series A at the end of January.

Apruve uses a ‘credit automation platform’ to help organizations extend payment terms to their customers without added back office costs, cash flow concerns, or financial risk.

Let’s hear more about this milestone from the source, CEO Michael Noble.

Why the decision to raise series A investment in the first place?

We were at an inflection point in our growth where we were feeling pain in all areas of our business. Raising capital allows us to add headcount to help solve for this pain and capitalize on our 2018 growth to continue the march forward.

How did you land on the $6m figure and why these investment partners?

Some of this is based on simple cap table math and the rest is trying to model a path toward our Series B. Once you have that model in place, you can backtrack from your goal to figure out what it’s going to take to get there and what resources will be needed. $6M gives us the ability to adequately invest in the company to reach that goal.

Cloud Apps Capital is a pure B2B firm that has done similar deals in our space. In addition, the lead partner on the deal has direct experience as an operator in similar companies that he helped grow from a similar stage. This was a significant value-add for us. We need to tap into that experience.

How much overall investment capitalization have you realized to date?

$10M, including this round.

How many current FT/PT employees does Apruve have and what is the 2019 projection?

11, growing to 24 by Q2.

What is working for Apruve right now in the market – that is how does the product solve problems, provide ROI – and for what type of customers does it appeal to?

We solve for a large, measurable pain point. Our customer is in B2B: Manufacturer, distributor, wholesaler or service provider. Their customers want to pay on terms (Net 30, Net 60). These suppliers aren’t banks or credit agencies, yet they lend their own money and staff a room full of people to collect on it. Apruve automates this entire A/R process connecting the suppliers, their customer and 3rd party banks. All invoices on terms are routed to one of our underwriters. They pay the supplier the next day while the buyer still gets their 30+ days to pay. The ROI is significant and measurable.

A/R process costs + cost of lending your own capital + risk + loss > Apruve.

Who/what else in the market does this and how do you differentiate?

We have a few competitors and other supply chain finance firms that focus on the A/P side of the equation, selling to the buyers to help them pay their bills. We focus on the seller and with an API first integration, the entire process is hands off and automated.

What metrics guide your success? How are they growing say 2017-2018, past 12 months?

We were up about 2000% in 2018 on most of our metrics. Orders, invoices, credit issued, # of corporate accounts are a few of metrics we measure.

What has been the greatest learning experience lately for you as an entrepreneur + CEO?

I think my eyes have been opened about how reactive we’ve been as a company, just trying to survive and service our customers needs. Raising this capital gives us the ability to be more planful, set stronger goals and map our way to achieving them.

What’s the biggest question mark, challenge, or unknown as it relates to the future of Apruve?

At this stage, our biggest challenge is continuing to build an A+ team. Our current team has killed it to get us to this point. They need help to take it to the next level. Finding the right person for the numerous positions we are looking to fill is always a challenge.

Is there anything else you would like to add?

Raising this capital from a standout west coast VC is a tip of the hat to Minnesota. We’re hoping to not just build a strong company, but one that can continue to build out the startup ecosystem in our community.