Paystand has acquired spend management software startup Teampay to create what the companies describe as a “no-fee B2B digital payment and spend powerhouse.”
Financial terms of the deal were not disclosed. Teampay has raised $65 million since it was founded in 2016.
The combined company services over 1 million businesses running on a commercial blockchain to more than 1 million participants. It has processed more than $10 billion in transactions to date, which it touts is nearly 2% of annual U.S. business-to-business payments.
“Teampay represents this new class of fintech companies,” Paystand CEO Jeremy Almond said. “They have products for CFOs to really change how they can digitize all of their workflow. It’s what I’d call a next-gen experience for the users and is a good fit for our customers going through this really big modernization process.”
Paystand will continue to run the Teampay brand, mainly because it is well-known, he said.
Almond believes businesses in fintech should learn from consumer finance apps. In the B2B world, the process for sending and receiving funds is complex, slow and riddled with fees. But consumers can send and receive money to each other via Venmo or CashApp. Those are the kinds of features he wants Paystand to offer.
Teampay is the blockchain-enabled B2B payments provider’s second acquisition in two years. It purchased payment platform Yaydoo in 2022. At the time, Paystand’s valuation was north of $1 billion. Paystand brought in $98 million in venture capital since being founded in 2014. Teampay is not on the blockchain, however, now Paystand can bring that functionality to both the accounts receivable and accounts payable sides.
“We think it’s a trend of consumerization of the enterprise,” Almond said. “Now we can offer both sides to 1 million businesses.”
Despite fintech being a hot industry in recent years, the banking industry overall has an aging payment rails problem. This causes higher fees, more intermediaries and delays. Almond is a long-time proponent of using a decentralized financial infrastructure to solve the payment rails problem. Paystand uses the Ethereum blockchain as the engine for its Paystand Bank Network, which enables business-to-business payments with zero fees.
“Blockchain is the new cloud,” he said. “I know blockchain, bitcoin and decentralized finance networks have their share of problems, but they represent a fundamental shift away from the same central banking system that’s been in place since the 1930s.”
“A lot of people think blockchain or decentralized finance is not ready yet,” he added. “What we’re really proving is if you create real value for businesses and finance teams, people will use it.”