Bill.com has closed an $8.5 million funding round led by August Capital, with previous investors DCM and Emergence Capital also participating in the round. As part of the deal, August Capital’s David Hornik will be joining Bill.com’s board. Bill.com has now raised a total of $17 million.
Bill.com looks to help businesses streamline the convoluted processes that are often involved in paying bills at large companies. Unlike your typical personal bill payments, which simply require hopping onto your bank’s website and transferring funds, large busineses typically have fairly complex approval processes in place before a bill gets paid: various managers have to sign off on the bills, and then they have to get sent to the finance department that handles the actual payments. Even worse, most businesses still use inefficient paper documents throughout the process.
Bill.com takes the process digital. To use it, you fax your bills to a specified phone number (any bills that come in digitally can simply be Emailed into the service). Bill.com automatically scans the document, and lets you Email it to anyone who needs to sign off on the bill before it is paid (mangers click a special link to indicate they approve). Once everyone has signed off, the finance department can use Bill.com’s payment system to make the actual transactions. The service uses OCR to archive all documents for later searching. And while the service caters in part directly to businesses, Bill.com also appeals to accounting firms, as it can streamline the way they process their clients’ bills.
Bill.com charges a base fee of $24.99 a month for one user, with each additional user running $9.99 (there’s also a small fee associated with each check payment). It’s hard to gauge just how much money companies are saving in terms of time saved using the system, but VP Marketing Jeff Schultz says that companies are reporting upwards of 50% deductions in the amount of time taken to pay bills.
Bill.com was founded by René Lacerte, an entrepreneur who has proven he knows what he’s doing in this space — he previously founded online payroll service PayCycle, which was just acquired last month by Intuit for $170 million.
where did the previous 10 Mil$ go?
That’s not the case. The case is they (Bill.com) managed to get more funding. That means they have promising prospects to generate profit. At least, that is how capitalist ventures see them.
It seems like a complicated process just to pay a bill.
That’s the point. Paying bills in large businesses is a very complicated process. Taking the passing-around-papers part of the process out of the equation simplifies things a bit, and simplifying business processes is a pretty good business to be in.
Very web 1.0 website for a very web 1.0 (take something offline and put it online) business.
Thanks, Dan. Bill payment is also a very paper-intensive and complex process for SMBs as well. It’s amazing how much time is wasted on tasks that at the end of the day do very little to help a business owner serve their customers and grow their business. We very much appreciate the feedback.
“VP Marketing Jeff Schultz says that companies are reporting upwards of 50% deductions in the amount of time taken to pay bills.”
Businesses usually want to delay paying bills as long as they can, not pay them faster. (They can use the money for several purposes including just earning interest at a bank account.)
However, digitizing the process is certainly makes it easy.
I’m pretty sure what he’s saying is that ONCE it’s time to pay the bill (29 days into the 30 day payment terms), bill.com is 50% more time efficient than the alternatives.
Being a small biz owner, I “get it,” and like the idea. Plus, this guy apparently knows what he’s doing from the sale of his last one.
Thanks, TZ. You are correct in that my comment was addressing the time and cost of managing and paying the bills, which includes figuring out what to pay and when to pay it.
Thanks for the feedback!
The domain itself costs millions.
Congrats to the Bill.com team!
Congrats to Bill.com! I’ve recently begun working with Bill.com, and they are a pleasure to work with.
Thanks, Terry! Great to be working with you.
We have been looking at Bill.com for our own company and for our clients (we are a CPA firm). If you have one reimbursement account and a complex approval process then Bill.com is worthwhile for the monthly cost and time required for faxing in your bills (alternative you can convince your vendors to fax the bill directly to Bill.com). Otherwise Bill.com is a waste of time.
For my company, we have one reimbursement account and I and the CEO personally approve all the bills so Bill.com would have considerable increased the amount of time it takes to pay the bills. Alternatively, we have high-net-worth clients that have multiple checking accounts and multiple people involved in the approval process and they were quoted $500-$600 per month. So even though it would have saved them some time (but nowhere near 50%) and they wanted a “content management system” for their bills, the cost was too prohibitive.
Mo, thanks for taking a look at us and we appreciate the feedback. Not sure about the details of your situation, but we have a significant number of customers with only one or two users who benefit from features other than the approval process. For example, convenience of web access to all bills and financial documents, eliminating the need to print, stuff, sign, and mail checks or perform duplicate data entry with their banking system, all while staying 100% synchronized with their accounting software, etc. The collaborative features are just one area of benefit. Happy to chat more if you contact us directly.
Also, we have HNW clients paying as little as $25 a month but it can go higher depending on complexity of their financial structure, approval process, and number of payments. But in those cases we work very hard with their accounting firm to demonstrate the cost savings model compared to what they were doing before (which is often VERY expensive and time consuming). Without knowing the details of your example, that seems high so please contact us because we have pricing structures for high-volume cases.
Again, thanks for the feedback!
Congrats to the Bill.com team!