Investments overall in B2B marketplace companies aren’t as big and splashy as in the last two years.
But marketplaces in the right industries, niches and markets are getting funding from picky investors, according to new data from Bowery Capital. Bowery is an investment management firm focused on B2B marketplaces and similar categories.
B2B marketplace investment deals
A look at 13 recent transactions reveals a wide range of investor totals. For example, in February, ShiftMed raised $200 million led by health care investors, Panoramic Ventures with participation from Blue Heron Capital and Audacious Capital. ShiftMed is a B2B marketplace for health care systems looking for help such as traveling nurses. Funds will be used to expand ShiftMed’s national footprint across all segments of the health care market.
On the other end of the spectrum, ePallet in August raised $5 in new cash from Bowery Capital to expand. EPallet is a B2B marketplace that restaurant chains, franchises, and other companies in the hospitality industry use to get manufacturer-direct deals.
In the middle, B2B marketplace TruckSmarter closed a $25 million funding round led by Thrive Capital with participation from:
- Bain Capital
- FJ Labs
- Founders Fund
- Andreessen Horowitz
- Fin Capital
The funding will help TruckSmarter to continue building on its marketplace platform for owner-operator truckers and freight haulers. To date, TruckSmarter has raised more than $44 million in funding. TruckSmarter offers drivers a free marketplace app that displays loads from hundreds of brokers in need of a freight hauler.
“Since the beginning, we have put the needs of the truck driver first,” says TruckSmarter Daniel CEO Kao. “Not just from a large carrier perspective but through the eyes of the owner-operator — the entrepreneur.”
Picky investors
B2B marketplace investors have tightened the reins and narrowed the focus on which marketplaces receive funding, says Bowery Capital.
But the marketplace platforms that are raising money have a common trait: a viable business model with a good financial base and a clear path to market growth.
For example, ePallet says it carries 10,000 products from food and beverage companies such as PepisoCo., General Mills, Conagra and Campbell’s. It carries products from over 800 total brands and more than 400 suppliers.
“EPallet’s marketplace fills a crucial gap in the wholesale supply chain that has historically seen limited investment in transformative technologies,” says Bowery Capital general partner Loren Straub.
In health care, ShiftMed fills what it says is a costly void in the health care industry. ShiftMed offers a nursing jobs app that delivers an on-demand workforce marketplace for credentialed nursing professionals. It matches affordable professionals such as nurses with temporary openings at hospitals, long-term care facilities and at-home health care agencies. To date, ShiftMed says, it has over 350,000 nursing professionals with more than 1,500 enterprise health care organizations for direct access to labor for shift scheduling.
“Health care providers continue to struggle with access to credentialed workers as patient needs and volume continues to rise,” says CEO Todd Walrath. “ShiftMed is positioned to provide health systems with a regulatory-compliant W-2 solution that leverages local and part-time resources.”
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