Online marketplace provides competitively priced capital to America’s small and midsize businesses

Online marketplace provides competitively priced capital to America’s small and midsize businesses, transforming an $18 Trillion marketplace and making receivables financing an attractive mainstream financing option for the B2B sector

NEW ORLEANS, January 27, 2010 - The Receivables Exchange (www.receivablesXchange.com), the world’s first online marketplace for real-time trading of accounts receivable, today announced that it has closed $17 million in Series C financing led by Bain Capital Ventures, with additional commitments from existing investors Redpoint Ventures and Prism Ventureworks. The Receivables Exchange pioneered the online receivables financing marketplace in 2008 with the launch of its proprietary receivables trading platform. The receivables finance industry represents an $18 trillion marketplace. Most companies have more than 60% of their working capital tied up in accounts receivable, limiting their ability to fund the growth of their businesses and contribute to the growth of the U.S. economy. On The Receivables Exchange, businesses are able to sell their accounts receivable at competitive terms to a global network of accredited institutional investors that compete in real time to purchase them.

Bain Capital Ventures is the venture capital affiliate of Bain Capital, one of the largest and most respected private investment firms in the world. Bain Capital Ventures is known for its exceptional approach to identifying and partnering with the management teams of early and growth stage entrepreneurial companies to build market leaders. The firm has invested in such industry-leading companies as LinkedIn, Staples, SunGard, DoubleClick, Instinet, SolarWinds, ProfitLogic, Archer Technologies, Shopping.com, Taleo, m-Qube, Aspect Development, Gartner Group and others.

The Receivables Exchange will use the funding to further scale its operations and sales activities and to significantly expand its marketing, business development and corporate partnership efforts. The company’s goal is to drive maximum awareness of its proven exchange-based receivables finance model among the millions of small and midsize businesses in the B2B sector. The Receivables Exchange will also continue to evolve its patent-pending trading platform and optimize customer lifetime value.

“Cash flow is one of the biggest considerations for most companies – and one of the greatest barriers to improving operating and financial performance,” said Jeffrey Schwartz, managing director of Bain Capital Ventures. “The Receivables Exchange is a game-changing innovation that we believe, based on our experience with hundreds of portfolio companies, can revolutionize the way businesses manage their cash flow and fund their day-to-day operations. The model has been proven and The Receivables Exchange is extremely well positioned to continue its growth and to integrate with other leading business finance applications. In the past year, this exceptional management team has delivered exponential growth and instituted the sound management practices we look for in our companies. We look forward to working with the team to solidify their stronghold and build a new capital marketplace.”

“We were fortunate to have significant interest from numerous well-respected, high-profile venture investment firms,” said Justin Brownhill, co-founder and chief executive officer of The Receivables Exchange. “Bain Capital Ventures immediately stood out because of their track record of establishing long-term market leaders, particularly in the capital markets arena. And, their reputation of serving as a fully committed strategic collaborator is precisely the type of premier partner that we were seeking as we continue to scale and enhance the model. We are thrilled to have such a remarkable firm on our team.”

“Receivables financing is one of the oldest financing models in America and yet, until now, it has not been delivered as a viable, flexible cash management solution for mainstream American companies,” said Jeff Brody, founding partner of Redpoint Ventures. “We firmly believe that The Receivables Exchange is uniquely positioned to transform the $18 trillion receivables finance marketplace by further scaling their open, efficient and competitive marketplace. We look forward to continued success in our partnership with The Receivables Exchange and we are excited to welcome Bain Capital Ventures as a new partner."  

“We take great pride in returning America's small and midsize companies back into the driver's seat of their business financing, allowing them to control when and at what price they increase their working capital,” said Nic Perkin, co-founder and president of The Receivables Exchange. “Over the past year, we were able to bring millions of dollars of competitively priced capital to hundreds of companies in the B2B sector. With this next round of financing, we look forward to helping hundreds of thousands of companies improve their financial performance by revolutionizing the way they manage their working capital.”

The Receivables Exchange connects Buyers and Sellers in a real-time auction marketplace to buy and sell receivables. By selling their receivables in an open and competitive marketplace, Sellers are able to reduce their cash conversion cycles, gain access to competitively priced capital and reinvest that cash into growing their business. Buyers gain access to a new investable asset class with attractive risk-adjusted returns and the opportunity to invest in the growth of the nation’s thriving small and midsize businesses.
 

About The Receivables Exchange
The Receivables Exchange (www.receivablesXchange.com) is the world’s first online marketplace for real-time trading of accounts receivable. The Receivables Exchange is changing the landscape of small business financing by providing a new dimension in working capital management. The Exchange connects a global network of accredited institutional investors (Buyers) to the nation’s millions of small and midsize businesses (Sellers) in search of capital to grow their businesses. Buyers get direct access to an $18 trillion new investable asset; Sellers get access to a new competitive working capital management solution by having their receivables bid on in real-time by multiple Buyers. For more information, visit www.receivablesXchange.com.


About Bain Capital Ventures
Bain Capital Ventures (www.baincapitalventures.com) is the Boston-based venture capital affiliate of Bain Capital, which has approximately $65 billion of assets under management worldwide. Founded in 1984, Bain Capital and its affiliates have made investments in more than 300 companies. The firm’s history of investing in early stage companies also dates back to 1984, having made over 125 venture-stage investments since inception including such companies as LinkedIn, Staples, SunGard, DoubleClick, Instinet, SolarWinds, ProfitLogic, Archer Technologies, Shopping.com, Taleo, m-Qube, Aspect Development, and Gartner Group. In 2001, Bain Capital Ventures was formed as a separate arm of Bain Capital to focus exclusively on growth investments. Bain Capital Ventures currently has approximately $1.5 billion in assets under management.

About Redpoint Ventures
Redpoint Ventures focuses on partnering with and funding innovative companies that have the potential to define, lead, and change industries. Redpoint partners have many decades of experience and success in technology investing; combined with this foundation, the firm is able to leverage a thriving network of entrepreneurs, partners, and industry experts to accelerate building market-leading companies. Redpoint (http://www.redpoint.com) was founded in 1999 by partners from two of the top firms in the venture capital industry and currently has over $2 billion under management. The firm is headquartered in Menlo Park, CA with offices in Los Angeles and Shanghai, China.