Melio Raises $110M, Reaches $1.3B Valuation as Small Businesses Digitize to Stay in Business

Melio, which helps small businesses digitally manage their supplier payments, has raised a further $110 million to expand its offering across the US as the small business shift to digital solutions accelerates, rocketing to a $1.3B valuation in the process.

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Left to right: COO Ziv Paz, CEO Matan Bar, CTO Ilan Atias (Photo: Business Wire)

Melio’s monthly active users (MAU) grew by over 2,000% in 2020 -- a sign that small businesses are increasingly adopting digital solutions to mitigate against the effects of COVID on their bottom line. Melio provides a single, integrated tool that allows small businesses to transfer and receive payments in a faster, easier way; giving oversight and control over cash flow, reducing or eliminating late payment costs, and giving businesses back valuable time.

According to a survey of 1,000 small business owners, carried out by OnePoll and commissioned by Melio, thirty-one percent of small business owners said embracing new technology helped their business during COVID-19.

“Getting better control over cash flow and the ability to manage payments remotely --and small business digitization is here to stay-- are key elements of a business’ health, and that process shouldn’t be complicated,” said Melio CEO and co-founder Matan Bar, a former PayPal Holdings Inc. executive. “We see this fundraising as a great privilege and responsibility to support small businesses during these challenging times.”

“Melio has identified both the opportunity and duty to help small businesses manage their finance remotely & improve cash flow, in normal times as well as during this crisis, as physical payments supply chains are interrupted and overwhelmed. Going digital is the only way small businesses can compete against larger rivals and stay ahead of the curve” commented Michael Gilroy, General Partner at Coatue.

Melio’s latest funding round, led by Coatue, brings Melio’s total funding to $240 million in 2020, giving it a valuation of $1.3 billion. Investors from previous rounds include Accel, Aleph, Bessemer Venture Partners, Corner Ventures, General Catalyst, and Latitude. Salesforce and American Express Ventures also invested in 2020, further solidifying both companies' interests in the small business economy.

Notes to Editors

• Media materials can be found in this Dropbox folder. Password: SmallBusinessInBusiness
• US small business user case studies available upon request
• Melio was founded by CEO Matan Bar, CTO Ilan Atias and COO Ziv Paz
• Melio allows businesses to pay their bills for free using a bank transfer or debit cards at melio.com
• Businesses can also use a credit card for a minimal 2.9% tax-deductible fee, even if suppliers don’t accept cards. Suppliers can receive a paper check or bank transfer and don’t need to sign up
• B2B payments volumes are estimated be $25tn per year in the US (Mastercard)
• As a bloc of 31 million firms, small businesses provided employment for 47.1% of working Americans over 2020, and have historically accounted for around 44% of all economic activity as well as 64% of net new private sector employment, according to the SBA
• Of these 31 million, Melio's specialty (smaller mom and pop shops) are a majority. According to data from the SBA, 87% of America's SMB's are sole proprietorships - 81% of all SMBs have no employees, and about 33% of all SMBs are family-owned (SBA)
• Some 42% of US B2B payments are still carried out with paper checks, according to the Association for Financial Professionals
• The US Chamber of Commerce’s July 2020 Small Business Coronavirus Impact Poll found that 45% of US small businesses are not comfortable with their cash flow
• Thirty-one percent of small business owners said embracing new technology helped their business during COVID-19, according to a survey of 1,000 small business owners, carried out by OnePoll and commissioned by Melio. The survey also revealed that for 25% of respondents, the pandemic accelerated the adoption of digital tools for their business
• Melio is part of the American Express ‘Stand for Small’ initiative, a coalition of more than 40 companies that have come together to provide meaningful support to small businesses as they navigate the impacts of COVID-19

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