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Dwolla announces $6.85 million investment

ByMatthew Patane

January 20, 2017

Dwolla has raised a $6.85 million investment round, the Des Moines-based payments technology company announced Friday.*

Union Square Ventures of New York and Foundry Group of Colorado led the round. Additional investors include Iowa’s Next Level Ventures, Michigan’s Ludlow Ventures and Detroit Venture Partners, Kansas City’s Firebrand Ventures and High Alpha of Indiana.

Dwolla CEO Ben Milne. (Jami Milne/Courtesy of Dwolla)

The company plans to use the investment to hire additional staff and expand its sales operations in Des Moines, according to a press release.

The announcement comes a few months after Dwolla said it would drop its consumer apps and focus on selling its API to developers and other companies.

Dwolla has 43 employees currently, after a restructuring last year. It plans to hire about 20 people during the next year, spokesman Jordan Lampe said in an email.

“The Midwest has a wealth of resources, but its biggest strength is its people and that’s a competitive advantage we plan on continuing to invest in,” Dwolla CEO Ben Milne said in a statement.

In total, Dwolla has raised more than $40 million in outside investment since launching nationally in 2010, Lampe said.

Prior investors include Union Square, Andreessen Horowitz and CME Group.

*Disclosure: Dwolla founder Ben Milne is a co-founder of Clay & Milk.

1 Comment

wade319

Posted January 20, 2017 at 7:33 pm

So happy that an Iowa company was able to raise ~40M on a big idea.

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Dwolla announces $6.85 million investment | Clay & Milk

A central Iowa ag-tech accelerator has secured more backers and finally has a name. The Greater Des Moines Partnership first announced the accelerator last year, naming four initial investors. On Monday, the Partnership said the program will be called the "Iowa AgriTech Accelerator" and named three new investors. The new investors include Grinnell Mutual, Kent Corp. and Sukup Manufacturing, all Iowa companies. They join investors Deere & Co., Peoples Co., Farmers Mutual Hail Insurance Co. and DuPont Pioneer. Each investor has agreed to put up $100,000 for the first year of the accelerator. Startups entering the program will receive $40,000 in seed funding in exchange for 6 percent equity. Tej Dhawan, an angel investor and local startup mentor, is serving as interim director until the AgriTech Accelerator names a permanent leader. Dhawan held a similar role with the GIA before Brian Hemesath was named as managing director. As interim director, Dhawan said his main job includes hiring the accelerator's executive director, establishing a business structure and initial recruiting for the first cohort. The accelerator will place few filters, such as location and product, on the applicant pool, Dhawan said. "When you’re seeking innovation, innovation can come from every corner of the world so why restrict ourselves," he said. One area the the AgriTech Accelerator won't recruit from is biotech. For its first cohort, the AgriTech Accelerator will work out of the GIA's space in Des Moines' East Village, Dhawan said. A future, permanent home is still to be decided. The accelerator's program will host startups from mid-July through mid-October, ending with an event connected to the annual World Food Prize. The GIA, which the AgriTech Accelerator is based on, also ends with presentations at an industry event. The accelerator has also started lining up a mentor pool. The Iowa Corn Growers Association, Iowa Soybean Association and the Iowa Pork Producers Association have agreed to provide mentors, as has Iowa State University. While the AgriTech Accelerator is loosely based off of the GIA, it will differ in its business structure, Dhawan said. The GIA runs through a for-profit model for both operations and its investment fund. The AgriTech Accelerator will have a nonprofit model for its operations and a for-profit setup for its fund. Dhawan said the nonprofit model is being used so the accelerator can better work with other nonprofit partners, such as trade associations. "These are all organizations that are nonprofits and can be amazing stakeholders without ever having to be investors in the accelerator," he said. "It becomes easier to work with trade associations in their nonprofit role when we are also a nonprofit." When it's up and running, the AgriTech Accelerator would be one of a handful of ag-focused startup development programs in Iowa. Others include the Ag Startup Engine out of Iowa State University and the Rural Ventures Alliance from Iowa MicroLoan. Matthew Patane is the managing editor and co-founder of Clay & Milk. Send him an email at mpatane@clayandmilk.com.

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