CFO podcast: Payhawk's journey from 60 VC rejections to Unicorn

On a recent Luminate podcast, our CEO Hristo Borisov shared the story of how Payhawk embraced change, weathered 60 VC rejections, and emerged as one of the leaders in global expense management.

Payhawk’s inception: filling a big void in a big market

Before he became a major driving force behind our company’s success, Payhawk CEO and co-founder Hristo Borisov explains how he was already well immersed in the world of software development, working in product management at Telerik. He honed his skills there, leading engineering teams, and gaining the experience needed for his next career move at Payhawk.

"It was this experience that laid the groundwork for Payhawk's inception" Hristo explains.

While at Telerik, Hristo describes how he saw firsthand the headache of managing corporate expense management. And he couldn't believe how many subscriptions slipped through the cracks in businesses. He was ready to solve a big problem in a big market and had some great ideas on how to do it.

For his next step? He packed up, dipped into his savings, and began brainstorming the next big thing in corporate expense management to support not only CFOs and finance controllers, but the wider business, too.

Hristo describes it as more than starting a company; instead it was a mission to fill a gap in the market that he knew needed addressing.

CEO Tip #1, Hristo says:

Always look for solutions that solve a big problem in a big market. Don’t be scared of other bigger players if your solution solves a real-world problem.

Laying the groundwork: The pre-VC journey

The road to developing Payhawk was paved with relentless research, countless finance controller interviews, and, ultimately the creation of a tangible solution to tackle businesses finance problems. Hristo explains how he and the team embarked on a journey of constant dialogue with over 40 CFOs, seeking to understand their pain points in managing company finances.

This feedback loop was crucial in shaping our product in early development, he describes. The team didn't retreat into a silo to build their product, they built it in the field while listening to those who would one day rely on it.

The approach Hristo and the team took was methodical:

• Identify the problem
• Validate the need
• Build a solution
• Market the solution

Using this approach — and after seven days of non-stop work — Hristo explains that our first subscription management prototype and the website were born.

The team started the project to streamline SaaS subscription management, a solution initially thought only to address the issue of overspending on unused subscriptions.

However, after many conversations with overworked CFOs, our team uncovered a deeper, more pressing need for a comprehensive corporate spend management solution. This pivot was a critical moment for Payhawk, steering it towards what it is today.

CEO Tip #2, Hristo says:

Engage with your end users early and often. The real value of a complete solution to markets’ problems lies in its ability to address the specific needs of its users, not just in its technological capabilities.

Navigating the storm: pushing through 60 VC Rejections

As Payhawk's ambitions grew, the team was met with a new formidable barrier, “the scepticism of the venture capital world”.

Despite having a prototype in hand — a direct result of extensive dialogue with CFOs and the realisation that businesses needed a more integrated approach to managing finances — Hristo describes the journey to secure funding as fraught with challenges.

Sixty venture capital applications, one after another, were rejected (and some VCs rejected multiple applications). Each rejection served not just as a setback but also as a moment of introspection for the team.

Hristo recalls:

Our journey began with a simple belief: to solve a big problem in a big market. Despite facing 60 VC rejections, we persevered, driven by our vision to redefine expense management.

The path from a promising prototype to facing VC rejections was marked by a critical pivot in our company’s strategy. Initially focused on subscription management only, the team's ongoing engagement with potential users uncovered a broader, more pressing need for a comprehensive spend management solution. While pivotal to our value proposition, this pivot change in strategy introduced a new level of complexity in convincing investors of our finance solution’s viability.

The market was crowded, and we were now proposing a solution that transcended simple subscription tracking software to tackle the multifaceted challenges of spend management, a major turning point in our journey!

“Hearing 'no' sixty times was a testament to our resilience,” remembers Hristo. “Each rejection was a lesson that honed our pitch, clarified our vision, and solidified our resolve.”

CEO Tip #3, Hristo says:

Resilience in the face of rejection is crucial. View each 'no' as an opportunity to refine your strategy and clarify your vision. The path to funding is often a marathon, not a sprint, requiring perseverance and a steadfast belief in your solution's value.

From phoenix to unicorn

Payhawk hit a major milestone when Hristo and team’s persistent efforts to secure funding finally paid off. They snagged big investments from respected venture capital firms including Lightspeed Venture Partners, Greenoaks Capital, and QED Investors, among others. These backers saw the potential in our burgeoning company’s vision and platform, giving us the boost we needed to grow and innovate. Thanks to this support, Payhawk transformed into the global, fast-growing company we are today.

Payhawk had now truly hit the ground running raising over $236 million in Series A and B rounds. This big cash boost not only showed that investors believed in Payhawk but also gave them the resources to grow and improve their services like corporate cards and enterprise spend management for mid, growing, and large companies. With these successful funding rounds, Payhawk made history by becoming Bulgaria's first unicorn, valued at over $1 billion.

CEO Tip #4, Hristo says:

Securing funding is critical to scaling your operations and expanding your impact. It requires a clear vision, a compelling value proposition, and the resilience to navigate through challenges.

Looking ahead: Payhawk's aspirations and the future of finance

As Payhawk continues to grow, our aspirations still centre on pushing the boundaries of what's possible in finance. By constantly innovating and staying ahead of industry trends, we’re continuing on our mission to solve problems for finance teams and support their evolving needs.

Hristo concludes:

Embracing change, overcoming adversity, and leveraging technology are not just part of Payhawk's story; they are imperative for all today's CEOs and CFOs.

In a world where change is the only constant, CFOs must be agile, forward-thinking, and ready to lead their organisations through digital transformation. Payhawk's journey from startup to unicorn status serves as a blueprint for navigating the challenges, seizing opportunities, staying agile, and continuously innovating.

See how our time-saving, insight-boosting technology can transform your finance strategy and help you manage change more effectively. Book a personalised demo today to explore our platform's capabilities and see how we could take your business to the next level.