A Manchester-based FinTech has raised £500,000 in pre-seed funding to help SMEs to discover, finance and control their spending on SaaS.

The backing for Lemon is led by SFC Capital and Pitchdrive, with angel investment from ex-partner of debt advisory at KPMG, Nick Dodd, and Kimberley Waldron, a co-founder at FinTech communications agency SkyParlour, who both join the Lemon advisory board.

According to research from Lemon, SMEs can spend upwards of £30,000 on SaaS software each year – however some are completely unaware that this expenditure is so high. 

Lemon allows them to manage their subscriptions in one place to establish overspend, gain clarity of company-wide SaaS usage and streamline business costs – reducing average spend by 20%. 

Lemon will now hone its product development, assisted by the appointment of new chief technical officer Matt Parke.

It will eventually increase its product functionality to include cost-saving instant credit options for SMEs, both from the Lemon dashboard and at the software vendor’s checkout, allowing them to capitalise on discounted annual software subscriptions offered by vendors. 

“It’s clear that we’re going through a really interesting period for SMBs at the moment,” said co-founder and CEO of Lemon Matt Bird. “Taking into consideration the challenging economic landscape with funding drying up everywhere you turn, SMBs now need the tools and services to help them build better businesses as cost-efficiently as possible. 

Wagestream to take on high street banks after £17.5m fundraise

“We’re really excited to be backed by two fantastic investment teams at SFC Capital and Pitchdrive, who not only believe in our vision and the future we want to build, but bring a wealth of knowledge alongside the funding we need to continue building Lemon and ultimately support as many SMBs globally with their growth trajectory too. 

“There’s a long road ahead, but we’re really excited to be on this journey with our new investors.”

SFC Capital investment executive Ed Stevenson added: “We believe that Lemon can scale into a dominant product with their vision to introduce instant credit, payments, discoverability and analytics. We are glad to be part of the journey with Matt and the team.”

British Business Bank CEO: New growth vehicle live within 8 months