Building a Venture Scale FinTech SaaS Startup: Mike Whitmire, co-founder and CEO of FloQast (Part 5)

Sramana Mitra: So, Series C is the last round of funding, or is there more?

Mike Whitmire: Oh no, we kept going. I know you like to talk about bootstrapping and whatnot.

Sramana Mitra: No, that’s fine. I just want to understand the story.

It doesn’t have to be bootstrapping. We do plenty of funding stories. That’s fine.

Mike Whitmire: I have a very different mentality. I wanted to build a really big company, and to do that in software, you need to invest heavily in product and go-to-market. I wanted to make sure we were in a position to do all those things and not have to make difficult trade-offs that come with running a cashflow-positive company. I respect those who do that, but I wanted to grow faster.

Norwest came to us, led that round, and we closed it at the end of 2019 or beginning of 2020—perfect timing for the wire to hit the bank. Fortunately when COVID hit, we didn’t have to overreact or drastically reduce expenses, which I’m very grateful for. We stood pat, waited to see how things played out, and they played out really well. Growth accelerated. That was one of the fastest growth periods in FloQast history—2020 and 2021.

At that point, we had more VCs approaching us. 2021 was an incredible time to raise money. We had several term sheets on the table. Again, we decided to take on more money, and raised a round led by MarTech Capital. We brought in a great board member, George Bischoff, and it’s been awesome working with them ever since.

Sramana Mitra: And that’s the last round?

Mike Whitmire: Nope, I’ve got one more for you.

So Series E—by then, we were continuing to scale. We started working more closely with a fund called ICONIQ. They got involved with FloQast because one of our early investors wanted to take some money off the table. ICONIQ already knew our story really well. I’m a big fan of our partner Roy Luo. The fund overall has been incredible to work with.

We started working with them through a secondary transaction. I got to know them better, and they later approached us saying, “We think you’ve really landed the compliance product.” Our second product line had really gained traction. From their perspective, it’s rare to find a company that has truly landed a second and third product line. They bet on our ability to scale that and land even more product lines in the future.

The opportunity I was most excited about was AI and how we could use it to drive more automation and reshape the future of accounting. So we took on even more money—raised $100 million from them. That round had a lot more intention around international expansion as well.

Sramana Mitra: Some amount of liquidity for early investors?

Mike Whitmire: Yes. There was a transaction before the Series E. It wasn’t announced—it was more of a quiet thing. An early investor had another project going on and wanted to liquidate a little. We connected them with ICONIQ and a couple of other funds. Because they owned a decent amount of FloQast, we ended up spending more time with them organically. They weren’t on the board or anything and hadn’t contributed primary capital. After they saw our success, they came to us and said they’d like to lead our Series E round. So they led that round, took a board seat, and have been more involved since then.

Sramana Mitra: So you raised a total of how much?

Mike Whitmire: We’re over $300 million at this point. We raised $210 million before we even hired a CFO. I take some pride in being able to do that without a CFO, although in hindsight, that was a dumb decision. I wish I had hired a CFO before that. Definitely something I would redo if I could. But yes, we raised $100 million in the Series E and are now just north of $300 million in primary capital.

This segment is part 5 in the series : Building a Venture Scale FinTech SaaS Startup: Mike Whitmire, co-founder and CEO of FloQast
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