Atlanta-based payment processing startup Rainforest has raised more than $30 million in less than a year and is looking to grow significantly.
The company announced Wednesday that it had raised $20 million in Series A funding, the second major round for Rainforest after it announced it had secured about $12 million in seed funding in October last year.
Rainforest CEO and founder Joshua Silver said the company decided to raise more money shortly after its seed round to capitalize on the demand it was beginning to see.
“The truth is, we still had plenty of capital left on our balance sheet from our seed round. We saw this as an opportunity to accelerate our product development and get to market faster,” Silver told The Atlanta Journal-Constitution.
Silver, a Georgia Tech graduate who previously started and sold a health care payments company, founded Rainforest in early 2022. His business helps software companies improve their customer offers by incorporating payment processing.
The Series A round was led by San Francisco-based venture capital firm Matrix, which has invested in startups such as post-payment platform Afterpay and customer service company Zendesk. Earlier investors in Rainforest, including Atlanta-based Tech Square Ventures, also participated in the Series A.
Embedded payments
Georgia is a global hub for payments processing, and financial technology companies employ more than 40,000 people in the state, according to the American Payment Processors Association, an industry group.
As an embedded payments processor, Rainforest makes money when its clients make money: The company takes a percentage of every transaction processed by software companies that integrate with its platform.
“Historically, the tailwinds that have driven our growth have been buying software from software companies and payments from banks and traditional payment processors,” Silver said.
But now, companies are selling both software and payments together and can embed Rainforest within their own software as a payment processor.
While Silver acknowledged that it was a “challenging” environment for a startup without Rainforest’s strong growth metrics, he said it only took him two months to raise the $20 million.
Funding for North American startups rose slightly in the first three months of this year compared with the end of 2023, according to data firm Crunchbase, but investment amounts are still down year-over-year.
Seed funding raised last fall enabled the startup to finish building out its platform and onboard its first customers, and now the company has dozens of clients across industries like logistics and healthcare, doing millions of dollars in transactions annually.
Rainforest has about 24 employees and is headquartered in Buckhead’s Atlanta Tech Village, according to Silver, who plans to use the $20 million Series A to add more staff and invest in sales, marketing, business development and customer experience.
The Atlanta Journal-Constitution and Report for America have partnered to get more journalists covering topics that matter to our community. Please help. Fund this important work.
