After selling bread last year for over $ 500 million, this founder just raised millions for his new fintech startup – TechCrunch
When Daniel Simon Bread sold, a consumer purchase and payments finance startup he co-founded, at Alliance Data Systems for more than $ 500 million at the end of last year, he quickly set a goal of create another start-up.
During the pandemic, Simon says he observed how much pressure was put on what he described as “real world” companies and their employees – such as truck drivers, plumbers, installers. HVAC and last mile deliverers – “and how little the last decade of fintech innovation has helped meet the needs of the large and vital segment of fleets.
So he teamed up with former Lyft manager Andrew Woolf to found Coast, a company that aims to meet these needs with the mission of becoming “the financial platform for the future of transport”.
And today, the New York-based company announces that it has raised $ 6 million in an “oversubscribed” seed funding round led by Better Tomorrow Ventures. Avid Ventures, Bessemer Venture Partners, BoxGroup, Colle, Foundation Capital, Greycroft and SciFi VC by Max Levchin – as well as over a dozen angel investors, including the founders of Plaid, Flexport, Marqeta, Bread, Albert, Addi, Lithic and other fintech and logistics startups – also put money in the spin.
Companies that operate fleets must allow their drivers to pay for vehicle-related expenses while on the road, such as maintenance, roadside assistance and gasoline.
But once a fleet grows to a size of more than a few vehicles, traditional small business credit cards are no longer enough because they lack the necessary security, visibility and controls at the line item level with a mobile workforce, according to Simon.
“Fleet owners need transactions to be authorized, for example, to buy gasoline for the company van, not the personal car, and to refuel at the pump, not for other shopping at the gas station convenience store, ”he said.
Historically, fleets have turned to specialized fleet and fuel credit cards that offer controls such as restricting purchases to only fuel products of a particular grade or tracking spend by vehicle. But Simon argues that the companies that sell such cards were founded decades ago with very little innovation since.
Coast’s goal is to use technology to provide fleet business owners and their employees with intuitive and easy-to-use payment products.
“They need their employee and vehicle payments to be integrated with the rest of their operations, and they need fair and transparent financial products that are easy to understand,” said Simon. Ultimately, he wants to bring “the same kind of ease of use and transparency that Bread has brought to e-commerce consumers and retailers to a class of businesses and employees that is often overlooked in technology.” .
Coast’s first product, slated for launch later this year, is a commercial refueling card. Drivers will be able to use a physical Coast card they keep in their wallet or a shared Coast card in the vehicle, and when they swipe it at a pump at any merchant that takes Visa, Simon says Coast will do a checkout. “Quick review of a complex set of rules for enforcing company fleet policies and flagging potentially fraudulent transactions.
“No need to enter the data requested by the pump – the driver is filling up and on his way,” he said.
Fleet owners and managers can use Coast’s web portal to assign drivers and vehicles, set policies and rules on who can buy what, how much, how often and when. They can also receive reports and alerts on their spending policies and potential abuse. At the end of the month, they will be able to pay off their Coast balance in full.
Ultimately, the company plans to add integrations into major accounting platforms as well as telematics platforms that provide real-time data on the condition and location of vehicles “so that it can provide actionable expenditure information to fleet managers “. Over time, Coast also plans to expand into more expense categories for fleet businesses as it seeks to become a holistic platform for the industry.
Sheel Mohnot of Better Tomorrow Ventures, who served on Coast’s board of directors in connection with the funding, said her company was impressed both by the scale of the opportunity and by the Coast team that s ‘attack there.
“Space is one of those massive, not-so-sexy categories with huge titulars that most people have never heard of, but customers – who are compelled to use them – universally despise. This is the perfect recipe for a startup to come in and disrupt it with a much better experience, ”Mohnot told TechCrunch via email. “Similar to what Ramp or Brex does for startups, Coast does it for fleet operators – it helps them control their spending so they can focus on growing their business. “