It is estimated that there are more than one billion people using Microsoft Excel in the world today, and a significant portion of them are small business people, and of those, 80% rely on spreadsheet software. to keep track of your finances. A startup called DataRails has created a suite of financial planning and analysis tools for those users so they can get more out of their spreadsheets in Excel (or whatever spreadsheet application is being used) and is seeing strong acceptance of its product by the market.
The New York/Israel firm has raised a $50 million Series B, which it will use to continue adding more functionality to its products, including more predictive modeling capabilities; and start creating new features for other teams that use spreadsheets like marketing, sales, and human resources. DataRails will continue to focus directly on SMEs.
“Predictive analytics and modeling is the holy grail,” Didi Gurfinkel, co-founder and CEO, said of SMB priorities, “because it gives them access to the kind of functionality that has been available for a long time to the smallest enterprises. large, but which has not generally materialized as a product for companies that may have only 50 employees. When we meet a potential client and he asks about this, we understand what he wants and we know that he will become a client”.
Qumra Capital leads the round, with new backers La Maison Partners and ClalTech, and previous backers Zeev Ventures, Vertex Ventures Israel, Innovation Endeavors, Vintage Investment Partners, ORYZN and Icon Venture. Gurfinkel, who co-founded the company with Eyal Cohen (the CPO), does not disclose the valuation of DataRails, but notes that the figure has tripled since the last round of 43.5 million, closed in June 2021, and that its main objective was to become a multi-million dollar company.
The company's revenue in the past year has increased fivefold and it has "hundreds" of customers, Gurfinkel said, although he declined to give an exact number for any of these metrics.
Before refining your approach to financial planning and analysis, DataRails had spotted an opportunity to provide tools to power Excel, knowing that it was widely used to track budgets, profit and loss, balance sheets, and month-end reporting, but not really in its functionality, especially when it came to running calculations to answer particular queries from certain teams (such as finance).
Interestingly, their initial focus was not on SMBs and financial planning, but on organizations of all sizes and providing tools to help them manage financial reporting and auditing, for purposes like tax and compliance. That functionality is still on the platform, but DataRails as a whole it was expanded further because "the analysis was more interesting," as Gurfinkel put it.
“When a CFO wakes up in the morning, his motivation is to see something new and understand something that he may not have seen the day before. Compliance tools are part of his responsibilities, but not really part of his desire to be the smartest person in the room".
It also happens to be a very lucrative area, estimated at a $7.8 billion annual market in the United States alone, and the potential use of DataRails it is based on the same amount of data as the initial product, giving the company the ability to build new solutions that leverage the same connections and information.
The company, Gurfinkel said, has no plans to reinvent the wheel and create its own spreadsheet software, preferring to build on top of the most popular packages in use today, which include not just Excel but Google Sheets, Numbers from Apple and more. This potentially prevents DataRails be too dependent on the Microsoft platform, but it also positions it as an attractive startup for one of these platform providers to acquire as they continue to seek more value-added services, engagement and long-term retention with their customers.
"DataRails is leading the operations transformation of finance teams, empowering teams across organizations with deep business intelligence (BI) capabilities. For the first time, all financial data is uploaded to the cloud, providing continuous agility and content sharing,” said Sivan Shamri Dahan, managing partner at Qumra Capital, in a statement. “DataRails has become one of the fastest growing SaaS companies we have seen and we look forward to partnering with the company as it continues its remarkable expansion into the market.”
