Sequoia Capital is betting the next European tech giant will emerge in Switzerland.
The Silicon Valley venture capital firm told CNBC that it led an $80 million funding round for Yokoy, a platform that helps large companies manage their expenses, invoicing and credit card processing. Previous investors Left Lane and Balderton Capital also took part in the round.
The deal values the Zurich-based company at more than $500 million, a person familiar with the matter told CNBC. The person preferred to remain anonymous discussing commercially sensitive information.
Founded in 2019, Yokoy sells its software to mainly large businesses, including the postal service DPD and train manufacturer Stadler. It’s competing with giants in the world of expense management like SAP and Coupa Software.
“Most of our customers tend not to have an enterprise-level spend management solution,” Philippe Sahli, Yokoy’s CEO and co-founder, told CNBC, adding its target clients typically rely on “siloed” IT systems that are isolated from other parts of the business.
Yokoy will use the fresh cash to pursue expansion in Europe — it recently opened up an office in the Netherlands — and hire more staff. With the help of Sequoia, the company aims to eventually enter the U.S. “I think it makes total sense,” Sahli said.
Matt Miller, Sequoia’s partner in London, said what attracted the firm to Yokoy was its use of artificial intelligence to automate spend management processes.
“AI and automation have a meaningful role to play in refining this piece of the enterprise experience and can save companies a lot of money,” Miller told CNBC.
Sequoia, an early investor in companies ranging from Apple to Swedish fintech giant Klarna, has been expanding its reach in Europe lately. The company opened an office in London last year and has hired a number of partners there to scout out new deals in the region.
Switzerland has a lot to offer when it comes to digital innovation, according to Miller. Google has a large engineering and development presence in Zurich, for example.
“We’ve found Switzerland to be an incredible place filled with incredible talent,” Miller said. “Compared to five or six years ago, there’s a lot more entrepreneurial zeal developing.”
Still, Switzerland has a long way to go. It’s currently home to only five “unicorn” start-ups with a valuation of $1 billion or more, lagging behind neighboring France and Germany. Yokoy is Sequoia’s second Swiss start-up bet to date; the firm previously invested in Ledgy, a Zurich-based equity management platform.