A niche-sounding pitch if it weren’t 2021 and the world didn’t run on subscriptions: Gravy wants to help subscription businesses keep their customers by remedying failed payments. The Atlanta-based fintech startup is turning the heads of investors toward this idea and recently raised $4.5 million in a Series A fundraising round. The company has found a gap in the market and cornered it.
What Is Gravy?
The fintech startup was launched by entrepreneurs Renee Weber and Casey Graham in 2017. The duo had previously worked together on an online business built on recurring subscriptions but found they would always have trouble covering failed credit card payments and returning customers, as explained by a 2019 blog post from the company. The startup founders realized that most other businesses did not have the in-house resources to specifically focus on subscription retention through payment processing and decided to build its part-automated, part-personal services as a package to clients.
According to a recent TechCrunch article, the company has scaled to service over 300 clients since it was founded. Additionally, the subscription fintech startup says it has won back $175 million in failed payment subscriptions, processing over 6 million failed payments, with hopes of returning $1 billion in failed payments by 2024.
Money and Investors
Gravy has publicly disclosed raising $6.9 million in funding to date, according to Crunchbase, with the majority of the haul coming from the startup’s most recent round. The subscription fintech company raised $1 million in a seed round for its business in May 2010. Then, the startup pulled in another $1.4 million the same time next year.
Its biggest fundraising round to date: the fintech company raised $4.5 million in a round closing this month led by Arlington Family Offices, one of the nation’s leading multi-client family offices.
The subscription help startup has ambitious plans to grow its business with this cash injection. According to its TechCrunch interview, the company said it is expanding its client acquisition efforts and investing further in its profit. A sign of its growth: the business said it plans to nearly double the size of its team by the end of the year to around 150 people.
Gravy is quickly gaining traction because of its success in identifying a profitable niche. Valued at $3.8 billion in 2018, the subscription and billing management market has continued to grow, and is projected to reach a whopping $10.5 billion by 2025, according to Zion Market Research. That’s a lot of businesses for Gravy to help.