Interview with Space Invoices 🚀 🚀 🚀
No, we are still not sending invoices in space...
Why them, and why now?
The fintech landscape is huge and we want to help our readers understand the industry from a bird's eye view all up to the smallest details. The best way to help you understand fintech details is to talk with companies that are specialized in certain areas.
Space Invoices is one of those companies, a company specialized in a specific service needed by the fintech industry
This interview is only the beginning, you can expect more interviews to follow.
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Let’s start the interview 👇
Can you please introduce Space Invoices and the founding team?
I’m Boštjan, the founder of Space Invoices. Space Invoices started in Slovenia in 2018, and this year we received an investment from Silicon Valley and are now headquartered there.
We are invoicing-as-a-service company. What that means is that SaaS companies who want to offer invoicing and payment functions for their customers can just plug into our solution instead of building it themselves. We can have a SaaS company up-and-running with their own invoicing and payments solution within minutes.
To give you a specific example, we’re working with online banking services, aka neobanks, who want to offer invoicing capabilities to their small business customers. Instead of building the whole invoicing stack themselves, they just plug into our solution.
I came up with the idea while running a software agency where we were developing software products for different customers. We would frequently use APIs of other products to accelerate development, for instance Google Maps' API. I noticed that there was no dedicated invoicing API for developers that would allow complex implementation of invoicing features into another software to fully automate the process via the API.
Why the name "Space Invoices", are there invoices in space?
Well, I’m really interested in space and astrophysics, so that was an inspiration. Beyond that, we are a global, cloud-based solution, so the name conveys that we are available without any geographical constraints. But sure, if we look out far enough into the future, I hope we will be serving customers in space at some point :-)
How many users do you currently have?
We are working with hundreds of companies across four continents. We currently issue north of 1,000,000 invoices per month.
Can you tell us an example of cooperation with the neobank in more detail? How does it look like, how much time and money do you save them with your solution?
Our customers not only save months of work developing and maintaining an invoicing infrastructure, they also gain a new revenue stream by re-selling the invoicing features to their users.
We've spent years developing our UI and API products to provide our customers a complete invoicing solution for different markets and needs, including tools for taxation, real-time reporting, payment processing, AR and AP automation, templating, and localization to 14+ languages for numerous countries.
Our customers choose which parts of our system to use and how to serve them to their users. For example, Thriday (thriday.com.au) used our API to build their own invoicing UI into their mobile app serving small businesses in Australia, while Pillar (gopillar.ca) uses both our API and white-label UI, which is styled to their brand, to provide invoicing to freelancers in Canada in just days.
Like many startups, you have also received a VC investment. Why did they decide to back you up, what is your unique selling point?
If you look at the traditional invoicing app business, the market is already pretty crowded with established players and startups. We’ve taken a different approach, embracing the “API services” business model. Rather than running a separate invoicing application, we allow software companies to seamlessly embed invoicing functionality into their solution by just plugging into our solution. From the end-customer’s perspective, they’ve never left the branded experience of the SaaS company. It’s a win-win: our SaaS companies offer a fully branded solution to the customer, and the customer enjoys a more seamless user experience. Our investors were specifically looking for API-centric fintech solutions that had the potential to disrupt the market, so that’s where we found a meeting of the minds. Our investors also recognize a global trend towards real-time transaction reporting to tax authorities around the world. This is a major strategic focus for Space Invoices, to be a one-stop-shop to support global e-reporting for our SaaS customers.
You’ve mentioned real-time transactions and reporting to tax authorities around the world. Can you tell us something more about how things look today, and how they will look in the future, with the help of solutions like yours?
As more countries move to electronic invoicing, many global tax authorities are adopting the strategy of real-time reporting of issued invoices, supported by the electronic invoicing trend. This provides them with greater control over issued invoices, resulting in tax revenue increases in the millions or even billions after implementation.
However, this change greatly increases the complexity of issuing invoices in individual countries, and is an even bigger problem for companies looking to launch their product in many countries.
This is where we come in. With a unified API that is only implemented once, software companies can expand cross-border without the need to update their software and legal background for each new market they wish to serve. On average, this saves companies a few months of development and even more in maintenance.
The trend shows that many global countries are adopting this approach. The EU, for instance, has already mandated that all countries in the block implement this.
From the name of the company, it's obvious you are dealing with invoices. Can you tell us a bit more about the industries you are serving, and their problems?
Primarily, we’re solving the problem of software companies offering services in different countries, like a marketplace example where their merchants might be from any country and the marketplace has to then issue invoices on behalf of that merchant's company for transactions. This means they have to adhere to whatever local legislation applies for that merchant's country. Besides marketplaces, we’re also working with neobanks, SaaS verticals like practice, businesses and channel management, and other type of vertical B2B SaaS business that have a similar challenge. In some cases, like mobility, we also solve the issue of infrastructure and scaling with hundreds of thousands of invoices being issued monthly for microtransactions.
How are invoicing and fintech connected?
The closest relation we see is payment processing. Usually, an invoice will either supersede or succeed payments, making them very closely related. For that reason, as of 2023, we’re also launching a payment processing service.
We're in a great position to tightly couple the two by allowing businesses to send out invoices that will automatically include a "Pay now" button and check-out flow directly on the shared invoice. But more importantly, we've observed that our customers are losing huge amounts of revenue potential in payment processing fees, currently collected by companies like Stripe. With this in mind, our payment processing product will allow our customers to collect a fee from the processing volume of their customers as well, while still offering cheaper processing fees compared to competitors.
Talk to us more about your synergy with payment providers, why does it make sense for them?
We’re currently working on partnerships with payment processor companies that want to resell our service as part of their product stack, yes. Some payment companies have already launched invoicing features, so others will have to follow suit if they hope to stay competitive. But since building and maintaining invoicing features is challenging, especially in Europe and more complicated states in terms of tax compliance, opting to work with a dedicated provider like us is a much safer approach for them.
What are your plans for 2023?
This year there’s going to be a big focus on the payment processing, and we're working on further expanding our footprint to support as many countries in the world as we can. We’re currently covering about half of the world, so they’re still ways to go.