Accounting fintech company Pennylane has raised €75m ($82.39m) in its latest funding round, doubling its valuation to €2.2bn, reported CNBC.
Sequoia Capital led the round, which saw participation from Alphabet’s CapitalG, Meritech, and DST Global.
The French accounting software firm, known for its “all-in-one” platform, aims to expand its services across Europe, starting with Germany.
Pennylane, founded in 2020, offers a comprehensive accounting platform tailored for small to medium-sized firms.
The platform provides tools for expensing, invoicing, cash flow management, and financial forecasting.
Pennylane CEO and co-founder Arthur Waller said: “We came in tailoring a product that looks a bit like [Intuit’s] QuickBooks or Xero but adapting it to the needs of continental accountants, starting with France.”
Currently, Pennylane caters to around 4,500 accounting firms and more than 350,000 small and medium-sized enterprises.
Pennylane’s growth strategy includes plans to mature its product in Germany within two years, a process that took five years in France.
“It is going to be a lot of work,” Waller noted.
The company also aims to achieve €100m in annual recurring revenue by the end of the year and reach breakeven, benefiting from lower customer acquisition costs.
The fintech company also plans to increase its workforce to 800 employees by the end of 2025, up from the current 550.
Pennylane is leveraging AI technology to automate bookkeeping and enhance advisory services.
“Because we have a modern tech stack, we are able to embed all kinds of AI, but also GenAI, into the product,” Waller told the publication.
“We are really trying to build a ‘co-pilot’ for the accountant.”
New electronic invoicing regulations across Europe are driving demand for digital accounting solutions.
“Every business in France within a year from now will have to choose a product operator to issue and receive invoices,” Waller stated, highlighting the potential market growth.
Luciana Lixandru, a partner at Sequoia, described the reforms as a “massive market opportunity” due to the fragmented nature of the accounting industry.
