London fintech startup gets EU cash to tackle SME late payment
Hokodo, a London insurtech startup aiming to fight the problem of late and unpaid invoices, has received €2 million in funding from the European Commission.
The company will be given the funds through the EU's Horizon 2020 funding programme, a scheme intended to encourage research and innovation.
Hokodo offers invoice insurance to protect European SMEs against the risk of late payment or default.
It has partnered with a number of other financial services providers to offer its insurance products through their platforms, including trade finance platform Centrifuge.
Late payment is amongst the most important issues facing small businesses in the UK and Europe.
According to some estimates, 20 per cent of UK small business failures can be attributed to late or non-payment.
Commenting on the investment, Louis Carbonnier, co-CEO and co-founder of Hokodo, said: “Every year across Europe, hundreds of thousands of companies are driven into insolvency because of late or non-payment of invoices.
“Trade credit insurance exists to mitigate this issue, yet SMEs have effectively been blocked from the market by an old-fashioned broker model, which doesn’t suit their needs. Hokodo is on a mission to rectify the situation, giving businesses the ability to protect their invoices when it suits them, and greatly reduce the risk of insolvency.
“Receiving the grant from Horizon 2020 is a huge boost for the business. Not only does it enable us to offer invoice insurance across Europe sooner than we would have otherwise, but we estimate we’ll be able to protect over €200 million worth of B2B trade over the next two years. It is also a huge vote of confidence for the importance of what we’re trying to do, and the role we have to play in supporting SME trade and success.”