Small business owners in Michigan may soon have the opportunity to manage their receivables, payables and accounting activities through their Internet banking accounts at area banks or credit unions, thanks to an innovative software platform developed by Troy, Michigan-based Autobooks.
“Autobooks’ integrated payment and accounting software makes it easy for small business owners to send electronic invoices to collect payment from their customers ─ which is similar to how they may use the bank’s Bill Pay system for paying bills,” says Steve Robert, co-founder and CEO. “The platform combines cash and accounting into a single tool to automate reconciliation.”
Unlike its standalone competitors, PayPal and QuickBooks, Autobooks offers a so-called “white-label” product, which is licensed to financial institutions. This arrangement enables banks and credit unions to brand the software platform under their own institutional names and offer it as a free banking service to their established small business clients. Customers will pay a small transaction fee when Autobooks helps them collect electronic payments to speed up their cash flow.
Currently, the fintech startup has plans to pilot its software platform at nearly a dozen financial institutions in Michigan and around the Midwest, which will offer the service to an estimated 20,000 customers. Robert anticipates the implementation process will be wrapped up by year’s end, and Autobooks will go live in the first quarter of 2017.
Initially, Robert and his partners financed Autobooks with $2.5 million of their own money after it was spun out of their prior company, Billhighway, in May 2015. This year, however, they turned to the venture capital community for additional funding to accelerate the company’s growth and participated in the 2016 Michigan Growth Capital Symposium as a presenting company.
“We saw the symposium as an opportunity to build relationships in the local venture community and establish our company as a Michigan-based business,” Robert says. “The reception we received was great. Fintech is an emerging market with tremendous revenue potential, so we drew a lot of interest from the investment community.”
Autobooks is scheduled to close a $5 million seed round of funding with participation from both institutional and strategic investors. In November, the startup took part in the Accelerate Michigan Innovation Competition, where it was awarded the first-runner-up prize of $100,000.
“This is a high-growth business, and there will be plenty of opportunities ahead to get more Michigan-based venture capital firms involved,” Robert says.