Invoice trading marketplace and Barclays Techstars alumni NoviCap has raised a $1.7m seed round.
The round was joined by Partech Ventures, Cabiedes & Partners and Techstars Ventures, the early stage funding arm of Techstars.
London-headquartered NoviCap helps SMEs combat the long payment schedules suffered when trading with larger firms by enabling them to trade their invoices online.
Investors buy the amount owed to the company, or a portfolio of debt, effectively creating a new tradable asset and an alternative method of financing SMEs.
NoviCap says it has had a 0% default rate since it started trading last year, with its focus on Southern Europe and particularly Spain, which the company says has the longest late payment terms in Europe.
Federico Travella, a former MD at Rocket Internet in Asia and now CEO and cofounder of NoviCap, said: “Extended payment terms can have far-reaching consequences for SMEs and the rapid growth of our business validates market demand for an innovative financing solution.”
Applications are open for January’s 15-week fintech programme at London’s Barclays Techstars accelerator, closing on 14 October.