FigBytes’ funding comes as some countries are mandating ESG reporting.
Ottawa-based Environmental Social Governance (ESG) insight platform FigBytes has raised $14.5 million USD ($19.8 million CAD) in a mix of incremental funding and venture debt, which closed in late October.
“Carbon emissions, water consumption, supply chain impacts, it’s all part of the same big picture.”
FigBytes said it had raised an additional $10 million USD from its April 2021 Series A round investor, Quantum Innovation Fund, but chose not to disclose if the financing was all primary capital, or contained a secondary component. The additional $4.5 million USD in venture debt came via Silicon Valley Bank. This brings FigBytes total funding to date to $25 million USD across two rounds.
Multiple VCs BetaKit spoke with on background noted that “incremental funding” is a new term gaining popularity to describe what has traditionally been known as a bridge round. A bridge round is an additional round of venture financing from the same investors as the prior round, often at a flat or depressed valuation but issuing the same type of shares as that prior round. The goal of a bridge round (or any fundraising round for that matter) is to extend a startup’s runway and hit certain metrics, allowing it to raise fresh capital from new lead investors at a higher valuation down the road.
FigBytes confirmed to BetaKit that the new $10 million from Quantum Innovation Fund was not an extension of its 2021 round. The company had not responded to questions regarding the valuation or share type by time of publication.
With the fresh funding, FigBytes will grow its sales and marketing departments, as well as its product development activities in North America, Europe, and India.
ESG is used to describe an organization’s disclosure of the sustainability, social, and ethical impacts of its business practices. The drive for ESG is fueled by federal regulators including the Canadian Securities Administrators, the U.S. Securities and Exchange Commission, and the European Commission who either have already or are in the process of introducing mandatory ESG reporting requirements.
FigBytes co-founder and CEO Ted Dhillon believes ESG needs to be addressed holistically. “Carbon emissions, water consumption, supply chain impacts, it’s all part of the same big picture,” he said. According to the company, FigBytes’ software created helps clients see the big picture in a way they can share with stakeholders.
FigBytes’ funding comes at a time when nearly 80 percent of investors say ESG is an important factor in making investment decisions according to a PwC survey. However, another PwC study finds that 59 percent of businesses only talk about their positive performance, and 73 percent are not obtaining reasonable external assurance on their ESG reports, which the PwC study says misses opportunities to build trust with stakeholders.
“In this emerging market, FigBytes stands out for its ability to bring comprehensive functionality based on a detailed understanding of customer ESG reporting needs,” said Quantum Innovation Fund partner Jeffrey Harris.
Feature image courtesy FigBytes.