An Atlanta payments software firm is setting its sights on expansion to Canada after a $29 million capital raise.
Rainforest’s latest series B round, announced Sept. 8, brings its total capital raised to $57.5 million and will help in offering “embedded payments” to more companies both nationally and north of the border.
Rainforest is a payments partner to software providers targeting other businesses, usually in specialized industry sectors. A software company focused on roofing providers or contractors, for instance, can embed Rainforest’s platform into its own, simplifying the offer of payment to the end customer. That software company then generates payments revenue.
The rapid uptake of the company’s solutions since its founding in 2022 is an example of how Atlanta firms continue to find valuable niches largely invisible to consumers, nesting a couple of layers down in companies’ tech stacks.
According to the Technology Association of Georgia, more than 260 fintech firms, including traditional payment companies, employ more than 42,000 people in the state.
Expanding to Canada will not only open the market for Rainforest itself, but it will also help the companies — both software providers and businesses — whose growth is enabled by its platform, said Founder and CEO Joshua Silver.
“Many vertical software platforms can support both U.S. and Canadian businesses. For example, a youth sports league management platform could likely be successful selling to both U.S. and Canadian youth sports leagues,” Mr. Silver told Global Atlanta in an email. “This means expanding to Canada won’t just unlock a new market for Rainforest, it also allows our existing platform clients to expand their current offering into a new market.”
Mr. Silver acknowledged that Canada expansion can be challenging, with fewer than 100 banks as opposed to the more than 4,000 FDIC-insured institutions in the U.S., where fintech has become a strategic area for expansion.
But while the “barriers to entry are higher,” the reward can also be great for those who take the time to understand local market nuances and payments habits.
“Too many U.S. companies just try to duplicate the American offering without making the appropriate adjustments,” Mr. Silver said. “While the U.S. and Canada are pretty similar in many ways, there are also lots of differences. For example, many Canadians make payments using the national debit rails (Interac), which doesn’t really exist in the U.S.”
Mr. Silver doesn’t worry about the deterioration of U.S.-Canada ties over the last year, which has led to some boycotting of American goods and services as companies “buy Canadian” to register their displeasure with U.S. tariffs.
“Over the last year, I’ve spent a lot of time in Canada and I consistently hear that vertical software companies are excited about additional fintech companies offering services in Canada,” Mr. Silver said, adding that this should be true “regardless of the political climate.”
The investors in the new round — led by Matrix Partners and Infinity Ventures, with participation from Accel and Atlanta-based Tech Square Ventures — all participated in the company’s previous $20 million series A in 2024. Since then, Rainforest has grown tenfold.
Matrix partner Matt Brown said the investment was a “no-brainer” given how Rainforest is empowering platforms to generate meaningful payments revenue via the “secret weapon” of embedded payments. Rainforest works with companies like Roadsync, a software platform for trucking companies based in Atlanta, and Keap, a CRM platform for marketers. Mr. Brown said such providers often see their revenues more than double when they start offering payment processing.
Mr. Silver, who also founded Atlanta-based Patientco and spent a decade there, often uses Uber or gym memberships with online platforms as successful embedded payment examples.
“All of them need to have payment technology behind the scenes, an infrastructure provider,” he said in a recent CSTMR podcast interview that explains how that revenue growth occurs in software platforms. “That’s what we do at Rainforest is we help all these thousands of software companies with that payments infrastructure.”
Source: https://www.globalatlanta.com/
