According to Forrester, companies lose 10-12% of their total contract value due to contract value leakage every year translating into $3 trillion in losses per year globally. The majority of contract value leakage occurs due to invoicing errors caused by an inability to track pricing terms, manual calculation errors, and poor performance monitoring practices. Billing and cost metering is still largely done through complex spreadsheets or solutions coded by in-house teams, which tend to fail as volumes increase.
Enter Tallinn-based Reiterate, which aims to automate cost and revenue intelligence for transactional businesses. The startup offers a reconciliation tool for finance, payments, and business intelligence teams to provide a no-code environment for generating automated custom pricing calculations.
Founded by the engineering-sales duo that previously built top-selling products at Veriff, the tool visualises complex pricing models and tracks performance to automatically detect charging errors.
The company has now raised €1.25 million. The investment round was led by Hummingbird Ventures and included a number of notable private investors, such as the co-founders of Showpad, and former Skype, Pipedrive, Stack Overflow, and Veriff executives. The new investment will be used to grow its global engineering and product team to further develop the calculation editor, improve client onboarding and grow traction in the U.K. and across Europe.
Going forward, the company's long-term product vision includes the use of neural networks to analyse agreements, followed by automated analytics to detect payment errors.
Joonatan Samuel, co-founder and CEO, Reiterate said: “Usage-based pricing is on the rise, as it is better aligned with today's customer behaviour. At the same time, managing complex pricing models is a challenge for large companies. Our market research has further highlighted the scale of the problem. We want to provide a simple solution to eliminate over- and undercharging and help the people caught in these stressful processes.”
Talking about launching in the U.K. market, Samuel added: "The product is focussing on fast-growing fintechs and transactional companies that outsource their payment services – companies that manage over 100 contracts, like Wise and Spotify for example. We piloted the tool with fintechs and gaming companies. The U.K. is known as the fintech capital of the world, which is why we are mainly concentrating our efforts here. We are also targeting fast-growing tech companies in Estonia, known as one of the unicorn factories in Europe, as well as across the Baltics."
After the U.K., the company will look at expanding in Malta, Sweden and Spain.
Nikita Andersson, venture capitalist, Hummingbird, added: “Despite revenue leakage being a severe pain point for enterprises, the market still lacks innovative solutions that move beyond databases and spreadsheets. Reiterate addresses a critical but underserved piece of financial infrastructure, revenue and cost management.”