Codat Lands $100M to Innovate Business Data Collection

Codat, a universal application programming interface (API) for small business data, has raised $100 million in a Series C investment that will help build and reinforce critical infrastructure, according to a Wednesday (June 8) press release.

J.P. Morgan Growth Equity Partners led the Series C round, which also saw participation from Shopify, Canapi Ventures and Plaid, among others. As part of the investment, Patrick McGoldrick, a partner at J.P. Morgan Growth Equity Partners, will also join Codat’s board.

The upgraded infrastructure will help Codat become the default means of sharing data for the small business economy, per the release.

Codat’s API is used by Software-as-a-Service (SaaS), lending and payment companies to build products for smaller business customers, including neobanks building cash flow forecasts and payment providers building new accounting software syncing methods.

The release said Codat’s technology will act as an agent of change for small business data, offering tools and opportunities the company claims have not been done before.

Codat CEO Pete Lord called the current era “the age of dial up” for business data, and despite advancements to technology, there’s still a lack of small business systems that “speak to one another.” This, according to him, makes for slower business and puts up walls against growth.

“No one will be speaking about SMB financial software integrations in 5-10 years — automated data flows over the Codat platform will be a presumed standard,” Lord continued. “The only time you’ll notice integrations is when they are not there. With the impressive caliber and strong sector expertise that J.P. Morgan and Patrick bring to our board, alongside our other advisors, we couldn’t be in a better position to capitalize on the massive opportunity in front of us.”

Codat also recently teamed with Deluxe, a payments technology firm, in order to let Deluxe customers use the company’s payroll and HR solutions to reconcile accounting data automatically back into their software.

Read more: Deluxe, Codat Team Up to Improve Accounting

The companies said that they wanted to provide what was something of an uncommon solution with seamless in-platform integration.

The collaboration will let users only connect one time through Deluxe, using Codat to handle the synchronization in the background — which should save time from not using the manual practices.