AppZen has just raised a $50m Series C funding round. However, the founder reveals it all started with one trick or treating walk with his kids.
Anant Kale (pictured) is the CEO and co-founder of AppZen, the platform aiming to make life easier for financial teams. The company’s solution automates manual processes, uncovers problems and optimizes decision making for enterprises.
Today the company counts one fourth of the Fortune 500 companies as its clients. The list of clients includes businesses like Amazon, Airbus and WeWork.
AppZen has just announced the closure of a massive $50m Series C funding round, bringing the total amount invested into the scaleup to over $100m. Coutue Management, the technology sector hedge fund, led the FinTech startup’s latest round.
The firm has recently led or supported rounds raised by InsurTech startup Root Insurance, corporate credit card company Ramp Financial and payment card issuer Marqeta. With the round, AppZen is now valued at $500m.
Kale and his co-founder Kunal Verma first had the idea of the San Jose-based enterprise during a simple walk. At the time, they were neighbours. Kale had gained years of experience building applications at Fujitsu and Kunal was the head of AI at Accenture Labs. “We were actually walking with our kids during Halloween, trick or treating when we first discussed the ideas about working together and would combine data science within enterprise applications that would solve real business problems for the back office,” Kale tells FinTech Global.
“I had a very good sense for what the business challenges were, and Kunal is an expert in what’s possible, so together we narrowed down the field to finance processes,” he continued. “We knew that was one of the areas [that is the] most ripe for disruption and where you needed not just to automate process but – even more importantly – you needed AI to help organizations make intelligent decisions, consistently, in real time, and at scale. With all that, though, you could say that trick or treating brought us together.”
Having decided to team up, they launched AppZen in 2012. Looking back at that first entrepreneurial period, Kale recalls that they had very clear aspirations. “Despite the broad vision, when we first built the company, we focused more narrowly on T&E automation,” Kale remembers. “Our first product was a mobile app that combined a chat bot kind of functionality to provide a personal assistant to users to help create expense reports.
“We tried to cover the whole nut – an app with user reporting, workflows and AI audit. We quickly realized that the NLP technology we built to understand expenses through a chat bot was a cool feature, the AI audit piece was interesting to enterprises and really needed. Focusing on that piece allowed us to integrate with all of the vendors in the expense management space, so we quickly became a strategic component of each of their solutions. That allowed us to grow incredibly quickly, from about 25 enterprise customers in the first year we really started to go in that direction to more than 1,500 today.”
Despite this, AppZen’s founder admits that having a broad vision did not make things easy. “Kunal, I and the management team are Type A people and sometimes [we] have eyes too big for our stomachs,” Kale says. “And more than that, we desperately want to make our customers happy and give them everything they want. But we have to slow ourselves down and be deliberate, otherwise we won’t serve our customers well. That’s the push and pull we struggle with every day.”
Looking to the future, AppZen’s latest funding round has thoroughly filled the startup’s coffers. However, the money will not just sit there. “We are using it to build out our platform to serve our customers for the long term,” Kale says. “Our vision is to be the [number one] AI platform for modern finance teams, going beyond just spend to receivables, revenue, treasury, FX, and beyond.”
The $50m invested now will be used to invest in the AppZen platform and “its semantic understanding of everything finance, its connectivity with the rest of the business, its deep learning capabilities, and its user experience.”
At the same time that it is focusing on its R&D AppZen will also scale its sales, “customer success, and G&A to take advantage of the market pull for our products.”
