Swan Raises €42 Million in Series B Funding Round

French startup Swan has secured another €42 million (approximately $44 million at current exchange rates) as part of its Series B funding round. This investment is the second part of the round that was originally announced in September 2023.

What Swan Does

Swan helps other companies offer financial products at scale. The company can generate both virtual and physical cards that work with Apple Pay and Google Pay. Cards can be configured programmatically by Swan’s corporate clients with spending limits, authorized merchants, and more.

Payment Accounts and Compliance

Swan can also create payment accounts with an individual IBAN. This way, accounts support pay-ins, pay-outs, and even SEPA direct debits. These accounts can be used as the source of money for the payment cards. Swan handles compliance and KYC obligations (“know your customer”), making it an attractive option for companies looking to expand their financial offerings.

Customer Success Stories

Several fast-growing companies have chosen Swan as their embedded banking partner. For instance, Pennylane, a French accounting startup that became a unicorn last year, now offers accounts and payment cards to its customers and relies on Swan for those features. Other customers include Indy, an all-in-one administrative assistant for freelancers, Agicap, Factorial, Lucca, and Sesame.

Company Overview and Expansion Plans

Swan works with 150 companies and processes €1.5 billion in monthly transactions. Eight Road Ventures is leading the second tranche with existing investors Lakestar, Accel, Creandum, Hexa, and Bpifrance participating again; Bpifrance originally invested in Swan’s seed round through its Digital Venture fund.

Quote from Eight Road Ventures Partner

“We believe the embedded finance opportunity is immense, and that banking services will increasingly be offered directly where users are, within existing software and workflows. We’ve known Nicolas and his team since their early days and have been consistently impressed by their rapid progress, Tier 1 customer base, and successful international expansion,” Eight Roads Ventures partner Lucile Cornet said in a statement.

Valuation and Future Plans

While the company isn’t disclosing its valuation, Swan’s co-founder and CEO Nicolas Benady told TechCrunch that it’s higher than it used to be. “We’re not a unicorn yet, so we don’t mention it,” he said. Swan will continue to expand to more countries, with Italy being next on the roadmap.

Unique Approach to Embedded Banking

As for Swan’s customers, having the option to handle money without handling money directly is an interesting opportunity. Swan handles compliance and KYC obligations (“know your customer”). With Thursday’s funding round, Swan will continue to expand to more countries, with Italy being next on the roadmap. Swan has built its own core banking system, which allows it to offer local IBANs and add country-specific payment products.