Posted March 12, 2021
A little over one year ago, Pipe raised a $6 million seed round led by Craft Ventures to help it pursue its mission of giving SaaS companies a funding alternative outside of equity or venture debt.
The buzzy startup’s goal with the money was to give SaaS companies a way to get their revenue upfront by pairing them with investors on a marketplace that pays a discounted rate for the annual value of those contracts. (Pipe describes its buy-side participants as “a vetted group of financial institutions and banks.”)
A few months after that initial seed raise, Pipe brought in another $10 million in funding as an extension of that round.
And now today, Miami-based Pipe is announcing a new raise — $50 million in “strategic equity funding” from a slew of high-profile investors. Siemens’ Next47 and Jim Pallotta’s Raptor Group co-led the round, which also included participation from Shopify, Slack, HubSpot, Okta, Social Capital’s Chamath Palihapitiya, Marc Benioff, Michael Dell’s MSD Capital, Republic, Alexis Ohanian’s Seven Seven Six and Joe Lonsdale.
While most of the round is dedicated to purchasing primary equity, a minority of the round is allocated toward buying secondary equity (meaning that a small portion of the dollars raised went toward buying shares from existing shareholders, such as employees and executives).
Pipe co-CEO and co-founder Harry Hurst is loath to label the latest raise with a stage.
“We don’t want to play the alphabet game,” he said. “This wasn’t about the money. We had five or six years of runway going into this round. It was about getting the right partners on our cap table.”