40Seas, an innovative fintech platform for cross-border trade financing, has raised $111 million to deliver a much more efficient and cost-effective financing framework for SMEs involved in global commerce. The company's $11 million seed funding round, led by Team8 with participation from ZIM Integrated Shipping Services Ltd., is complemented by a $100 million credit facility for exporters and importers.
The fintech startup, built in conjunction with Team8's Fintech Foundry, has emerged from stealth mode with a view to closing the $1.7 trillion global trade finance gap, providing a solution that enables digital B2B payment functionality while facilitating cross-border trade between SMEs. According to the Organization for Economic Cooperation and Development (OECD), SMEs account for 43% of cross-border trade volume. However, they are seven times more likely to be denied access to trade financing than multinational companies – according to the World Trade Organization. A host of financing-related issues have historically undercut the fast-growing SME cross-border trading industry, such as siloed banking jurisdictions, working capital constraints, trust issues, legacy processes, interest rate gaps and FX volatility. The recent market downturn, and the rising cost of capital, has put an additional financial strain on SMEs engaged in global commerce.
By leveraging AI and data-driven technology, 40Seas is able to offer flexible payment options that are primed to disrupt legacy trade-financing solutions, and extend the accessibility of working capital for SME importers, exporters, freight forwarders and sourcing agencies. Since going live with a soft launch in October 2022, 40Seas has already financed transactions for dozens of SMEs and is slated to finance tens of millions of dollars in the coming months.
40Seas empowers exporters to get paid immediately upon shipment so they can get a head start on their next production cycle. For importers, the platform offers deferred payment options to help them free up working capital and grow their business without tying up available lines of credit. The solution can also be leveraged by freight forwarders and sourcing agencies to increase cross-border trade volumes, generate new revenue streams and digitize B2B payment processes.
As part of their strategic cooperation, ZIM has extended 40Seas a three-year, account receivables based, senior secured, revolving credit facility of approximately $100 million, with an option to extend it to $200 million. To better serve customers in its ecosystem and generate new revenue streams, ZIM will embed 40Seas into the freight forwarding services offered by Ship4wd, its award-winning digital freight forwarding subsidiary, targeting the SME market. Through this integration, ZIM's SME customers will benefit from a digital financing solution designed to reduce operational and administrative overheads, and ease the burden of freight and inventory expenses.
40Seas is available as an API or stand-alone platform, both of which can be seamlessly embedded into checkout portals to improve business flow and deliver more convenience to customers. In addition to helping businesses streamline communications around order tracking, the platform utilizes data-driven technology to automate decision-making processes and verify creditworthiness.
Headquartered in Tel Aviv, with offices in New York City, Toronto and Shenzhen, 40Seas was founded by industry experts with more than 60 years of combined experience in cross-border payments, logistics, and trade financing.
40Seas is a fintech platform for cross-border trade financing that is tailored to SMEs engaged in global commerce. By leveraging data-driven technology, the company is able to offer flexible payment options that are primed to disrupt legacy trade-financing solutions, and make it faster, cheaper and easier for supply chain players - importers, exporters, freight forwarders and sourcing agencies - to access working capital.
Founded in Israel in 1945, ZIM is a global container liner shipping company with established operations in 100+ countries serving more than 25,000 customers in over 300 global ports. ZIM leverages digital strategies and a commitment to ESG values to provide customers innovative seaborne transportation and logistics services and exceptional customer experience. ZIM's differentiated global-niche strategy, based on agile fleet management and deployment, covers major trade routes with a focus on select markets where the company holds competitive advantages.
Team8 is a venture group that builds and backs the most innovative technology companies in the fields of fintech, cyber, data, and digital health.