French fintech startup Pennylane doubles valuation to $2.16B with €75M fresh funding from Sequoia and CapitalG

French fintech startup Pennylane just raised €75 million (around $81 million), pushing its valuation to €2 billion ($2.16 billion). The round was co-led by Sequoia Capital, Alphabet’s CapitalG, and Meritech, with backing from DST Global.

Founded in 2019 by Arthur Waller and a group of former PriceMatch founders, Pennylane has built accounting software that serves both accountants and the small to medium-sized businesses they support. The platform rolls together a range of features — invoicing, expense tracking, cash flow management, and financial forecasting — into what the team calls an “all-in-one” system.

Think of it as a localized alternative to QuickBooks or Xero, but with a focus on the specific needs of accountants in France.

“We came in tailoring a product that looks a bit like [Intuit’s] QuickBooks or Xero but adapting it to the needs of continental accountants, starting with France,” Pennylane’s CEO and co-founder Arthur Waller told CNBC.

Pennylane added its platform is now used by roughly 4,500 accounting firms and over 350,000 small and mid-sized businesses. The company was previously valued at €1 billion, making its latest valuation jump a clear signal of strong adoption and growing investor confidence, CNBC reported.

Next stop: Germany

Pennylane is still a France-only operation for now, but that’s about to change. With the new funding, the team is gearing up for European expansion, starting with Germany this summer.

“It’s going to be a lot of work,” Waller told CNBC. “It took us about five years to get the product right in France. We’re aiming for two years in Germany.”

The company expects to reach €100 million in annual recurring revenue by the end of the year and hit breakeven around the same time. According to Waller, Pennylane spends far less on customer acquisition than most fintech startups — with 75% of its budget going into R&D.

They’re also hiring. Headcount is expected to grow from 550 to 800 employees by the end of 2025.

Leaning into AI

Pennylane isn’t missing the AI wave. Waller says the team is integrating AI and GenAI features into the product to automate tedious tasks like bookkeeping and give accountants more time to focus on advising their clients.

“We’re really trying to build a ‘co-pilot’ for the accountant,” Waller told CNBC.

He also pointed to Europe’s incoming e-invoicing regulations, which will require businesses to choose a software provider to handle all incoming and outgoing invoices. That shift, he said, is opening the door for companies like Pennylane.

“Every business in France within a year from now will have to choose a product operator to issue and receive invoices,” he said, calling e-invoicing a “huge market.”

Sequoia partner Luciana Lixandru, who sits on Pennylane’s board, agrees.

“The reality is the market is very fragmented,” she said. “In each country, there are one or two decades-old incumbents and few options that serve both SMBs and their accountants.”