Banking on SMBs: How Rauva aims to bridge the business app gap in Portugal
Fintech start-up Rauva, which aims to be Portugal’s first business “super app” catering to small and medium-sized businesses (SMBs) and freelancers, has officially launched operations.
Rauva founders Sam Mizrahi (left) and Jon Fath (right)
Founded in 2022 by Canadian entrepreneur Sam Mizrahi and former Bunq COO Jon Fath, the Lisbon-based firm is aiming to make entrepreneurship “accessible to everyone”.
In an interview with FinTech Futures, Fath discusses the motivations behind launching the new start-up, its ambitions of becoming a super app, and why the company chose to focus exclusively on the Mediterranean region.
On choosing to target small businesses, Fath notes that with SMBs and freelancers, a common problem is the amount of manual work it takes to send invoices to their customers and how expensive this process can be, among other issues.
“Rauva is basically a tool for any entrepreneur, or anyone who wants to be an entrepreneur, to help them kickstart their journey,” Fath explains.
The start-up equips such entrepreneurs with business accounts accessible on their phones, through which they can send compliant invoices without having to deal with tax brokers. The app also offers solutions such as embedded payments, digital and physical debit cards, expense management, and soon plans on rolling out legal and accounting services.
“Everything is automated within Rauva, so you know how much in taxes you are going to pay, how much money you are going to save. You know if your customers are late to pay your invoices, and you manage and learn about your small operation from one single mobile app.”
To headquarter Rauva in Portugal was a strategic move, Fath says, with the country boasting a high concentration of small businesses.
“In Portugal, 70% of the GDP comes from the SMEs, and they represent 99% of the businesses in the country,” he says. “You don’t have the kind of concentration of multinational groups that you usually see in northern Europe, and so this is where we wanted to start our business.”
Once established in Portugal, Rauva will embark on expanding its presence to other Southern European countries, including Spain, Italy, and Greece. The company is also currently looking to land a full banking licence to achieve its “overall vision” and in order to launch credit features in the future.
While Rauva was gearing up for launch, Fath claims the company had 20,000 Portuguese businesses sign up to its waitlist.
Now open to the public, Rauva is offering up two pricing plans for its services. For €8 a month, it offers 20 SEPA and direct debit payments, three certified invoices, and three virtual cards. At a pricier €20 a month, it allows 100 SEPA and direct debit payments, 100 certified invoices, and 10 virtual cards.
“Freelancers and SMBs have the same challenges everywhere in the world, and banks are not helping them,” Fath says. “A lot of complexity in terms of taxes, bookkeeping, accounting in general means the issues are the same, the challenges are the same.”
Fath believes now is the right time to build a global platform that can understand local needs, “because the way you pay taxes in Italy is very different from Spain”. He claims 80% of Rauva’s products are scalable across markets, with 20% localised to adopt to local market needs.
“What needs to be localised is the complexity, which has been created by the local tax authorities. So eventually, what I would like to do is to be part of this global platform,” Fath concludes.
