Berlin-based startup Kadmos raises €29 million in Series A funding round

Kadmos, the end-to-end salary payments platform for cross-border employers, has raised €29 million (£24.6m) in a Series A funding round led by Blossom Capital.  The investment round, which follows an €8.3m (£7m) Seed round in December, also included existing investors Addition and Atlantic Labs.

The funding follows significant levels of demand for the product. Kadmos is already working with several high-profile shipping companies and has built a robust waitlist ahead of full-scale customer onboarding this summer. This new financing will be used for technology and product development. Kadmos is uniquely positioned to capitalize on the growing global cross-border B2C payment volume projected to reach $1.6 trillion by 2022, involving 169 million migrant workers across the world, according to the UN.

Revolutionizing the cross-border salary payment process

Kadmos was founded to tackle the severe restrictions placed on the financial freedom of cross-border employees and to use modern financial technology to allow migrant workers to have a streamlined salary experience, just as they would expect working in their home country. Migrant workers have so far received little attention from the recent fintech boom and Kadmos’ mission is to bring the latest financial technology to these underserved communities of workers to help them protect and secure their salaries so they are able to remit their pay home to their families.

The traditional financial system presents employers with unnecessary complexity when paying salaries across the globe, and often requires employers to pay large fees to simply transfer salary payments. For example, the shipping industry is still dominated by expensive, slow, and untransparent payment processes. Many shipping companies resort to bringing significant amounts of cash on board to pay their employees, which is both costly and insecure. Additionally, seafarers face unfavorable exchange rates and high fees to send money home to their families and often wait days or even weeks to get access to their salaries.

In the form of seamless and easy-to-use web and mobile apps, Kadmos has developed a secure salary payments platform for shipping companies that enables them to efficiently pay their crews. Kadmos provides seamless integration with the Kadmos web application, where companies can automatically add their employees through an API-connection to various crewing software.

Kadmos was founded in February 2021 by MIT graduates Justus Schmueser and Sasha Makarovych. Schmueser had previously managed corporate finance at McKinsey, while Makarovych built and led data science teams in the video games industry. The pair created Kadmos after a relative of Makarovych’s, who worked as a seafarer, told him of the complexity and hardship involved in getting paid.

Following further research, they realized the immense need for fintech solutions designed for the shipping industry. The team quickly grew with key hires including experts in product and engineering with Sergio Lopez from fintech startup Moss and Philipp Decurtins from global tech consultancy Capgemini.

Having now proved the success of its initial product in the shipping industry, Kadmos is looking to use the new round of investment to significantly grow its 30-person team and further invest in its technology and product. This includes the prospect of offering additional financial services to its users. Kadmos will also expand into other industries with similar salary payment complexities such as construction, healthcare, and hospitality.

Justus Schmueser, Kadmos Co-founder said: “The financial restrictions placed on migrant workers are truly shocking. Employees need to wait days or weeks for their hard-earned salaries to reach their families and are then forced into paying exorbitant transaction fees or have to carry large sums of cash at their own risk. At Kadmos, we are working to change the status quo through cutting-edge financial technology and ensuring the hard-working people who power the global economy can keep more of their well-deserved salaries.

“The speed and size of our latest funding round underline the potential for our platform and we’re honored to partner with such a reputable and prestigious venture fund in Blossom.”

Alex Lim, Managing Partner of Blossom Capital said: “From the moment we met Justus and Sasha, we couldn’t help but be drawn to their scale of ambition and drive. With outdated banking practices and multiple intermediaries that charge excessive fees, it’s clear that the process for cross-border payments is broken and Kadmos’ fintech platform is exactly the technology to fix it. 2022 looks set to be an exciting year for the team as they look to grow the product into new verticals and we’re delighted to be joining them on this journey.”

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