Here's how SaaS platform Finly helps businesses manage and streamline their spends betterVishal Krishna
Founded in 2015, SaaS-based platform Finly lets businesses automate, track, and streamline business spends, ensuring financial efficiency and cost savings.
Friends since they were teenagers, Veekshith Rai and Vivek A G became fascinated by digital currency after they graduated from an engineering college in Bengaluru, in 2012. They went down a familiar road, working in IT - Veekshith with Mindfree Labs and Vivek with Accion. But within just three years, they realised they had stumbled upon a huge opportunity in the financial world: managing expenses.
It's what led them to launch Finly, a business spend and expense management system.
Says Veekshith, “Before freezing on this idea, we had zeroed in on five problems we were interested in solving. We created pitch decks and reached out to industry experts, investors, and advisors. After feedback, multiple iterations, and a lot of detailed ideation, we froze upon Finly and built a prototype to get our first set of customers.”
Bengaluru-based Finly helps automate and streamline business spends, offering software for business expense management, digital fund disbursement, vendor payments, and GST-compliant invoicing and payments.
Why expense management?
Enterprises use expense management software largely to track and audit employee-initiated expenses, including travel and entertainment. However, most software doesn’t solve the purpose because of two main reasons: excessive dependence on tools like spreadsheets and emails, and disconnected payments (due to current banking technologies).
This ends up in lack of real-time visibility, low policy compliance, and the need for larger spends to manage finance teams. It also leads finance teams to spend over 65 percent of their time on manual and repetitive tasks, leading to inefficiency.
Enter Finly, which helps track spending of employees across all digital financial instruments. The intuitive software integrates with all accounting softwares and ERPs, and can help automate expense reports and reimbursements, and manage travel expenses and petty cash. It helps business processes flow efficiently, and keep a check on fraudulent activities.
Says Vivek, “We believe the next generation of finance teams will not spend time on manual work for day-to-day operations like making vendor payments, reconciling invoices, tracking advances, etc.” He adds that Finly will help finance teams to perform critical tasks like analysing and tracking key metrics relevant to the company's growth.
How Finly works
Finly has a SaaS component that automates all internal financial workflows. The SaaS component integrates with every kind of payment instrument in India ((UPI/ NEFT/ IMPS/ RTGS/ Prepaid Cards/ Credit Cards) to digitise all external financial transactions (cashless and paperless).
The SaaS application enables various stakeholders involved in each transaction (spender/reviewer/finance team/vendors) to communicate and collaborate while providing complete visibility to the finance team. The product keeps all business systems updated with financial transactions within the company, in real time. Says Veekshith,
“We engaged with a lot of CFOs and documented their pain points while building the product. We designed our solutions to align with these pain points while ensuring they were generic to the market and cut across the needs of finance departments for most industries.”
The founders then shortlisted potential customers, based on the problem and other parameters, and shared the product design with CFOs. They started work on building the system after receiving a partial payment and rolled out the product over multiple phases.
Focusing on the B2B industry
The founders are targeting the B2B industry as the B2C segment has gone through a massive disruption with technologies like UPI and applications like PayTM and PhonePe reducing the dependency on cash.
However, businesses continue to rely on traditional methods for handling and processing payments. This is primarily due to two reasons: banks’ continued focus on large-scale operations, and their inability to consumerise new banking technologies with software products/tools that cater to the needs of current businesses. As Vivek points out,
“Payments, an integral part of financial operations, remain disconnected from current processes. But payment technologies like UPI, currently open only to the B2C segment, will further drive adoption of digital payments when rolled out to the B2B segment.”
Finly, which has been seed funded by Axilor Ventures, claims to have more than 50 paying customers, but declined to give further details. Their business model is based on a per-user, per-month fee based on the module the customer opts for. They also charge a transaction-based fee based on the mode of transaction used by the organisation.
The duo has invested a little more than Rs 1 crore in the startup, which is reportedly generating close to Rs 7 crore in business. However, the co-founders did not confirm the number.
According to Research and Markets, the global expense management software market size is expected to reach $2.3 billion by 2023, growing at 10.6 percent CAGR during the forecast period.
Finly competes with other SaaS companies like Happay, Expensify, Pleo, and Fyle. All of them are taking on legacy software companies as they eye the global market.
The road ahead isn't easy. As Veekshith says,
“One of the challenges for us is changing the habit of finance teams. However, we tackle this with a strong customer success team, which connects with their customers after the sale. The other challenge is to recruit good people on the business front; people who have a combination of sales, technology, and finance skills.”
Finly aims to consolidate long-term contracts with 54 customers soon, and acquire 100 more customers in the next 18 months.
V Ganapathy, CEO of Axilor Ventures, says: “This market is a big opportunity and this startup helps clients track all their financial expenses. We believe Finly has figured out the market reach and is scaling fast.”