While many startups are known for being founded in garages, there is a second proverbial breeding ground for innovation: bars. In 2019, Zack Storms started an event where local entrepreneurs and their peers would mingle, collaborate, and share their passions. It was at one of these “Thursday Night Tradition” events where Zack Storms met his future co-founder, Tim Lynn, who was looking to connect with Edmonton’s startup ecosystem.
During that event, the two bonded over a shared dissatisfaction with conventional networking events and their desire to connect with people with interesting ideas. Soon after, they founded Startup TNT: a non-profit organization that connects local startups and entrepreneurs with angels, supporters, and other investors.
Startup TNT predominantly focuses on the Prairies region of Canada with plans to expand across the country. The company helps smaller angel investors combine their capital and invest in multiple local companies. As a small business itself, the company takes pride in not only helping smaller investors, but also in enabling other businesses to receive the capital they need.
Today, the Startup TNT Investment Summits that the company hosts are some of the most active investment events in the Prairies.
Payment options that just don’t work
The company has worked with over 400 investors and 100 companies, raising over $13 million in capital for Canadian start-ups. They've had to figure out a way to move this capital between investors and startups efficiently and cost-effectively.
Previously, Startup TNT would collect and send investment capital either by wire transfers, cheques, or e-Transfer — each of which brought its own challenges. Wires were slow and had hefty transaction fees, e-Transfers were tedious, and few had access to a cheque book. The company had to manually reconcile payments with their accounting software, using only email confirmations. Plus, they were capped at a daily $3,000 transaction limit.
“Throughout the year, we might have $4 million of capital that we needed to distribute,” said Jonah Tetz, an operations lead at Startup TNT. “Every day, we would receive e-Transfers from investors in $3,000 increments and would only get an email as a confirmation, which we would then have to reconcile. It was a very inefficient and time-consuming process — a total nightmare.”
On top of their core business of moving capital from investors to startups, they also spent a lot of time processing vendor payments for their Summit events.
In its early days, the company didn’t have the payment workflows in place to make sure payments to vendors were approved as quickly as possible. Due to the lack of automated processes in place, some approvals were delayed, slowing down vendor payments at the expense of their vendor relationships.
After looking at every payment option from wire transfers to checks and other payment platforms, the company did what a lot of startups do: turned to its network for advice. Fortunately, a bookkeeper pointed them to Plooto.
Making it easier to help other startups
By adopting Plooto's automation platform, the company immediately streamlined its previously time-consuming receivables workflow. There were no $3,000 daily limits, and receivables were now automatically reconciled to the company’s accounting software.
There were benefits to the payments workflow, too. The company could now easily pay out vendors immediately after their events by setting up approval rules inside the platform.
“Paying vendors through e-Transfer was a time-consuming process,” Jonah said. “As a startup, we could be using that time for so many other things. Since we’ve automated our payments through Plooto, we have more time, our vendors are happier, and we have better payment terms. If you like having happy vendors and better payment terms, use Plooto.”
Now with Plooto, Startup TNT can cut transaction costs, save payment processing time, and reduce friction to execute more deals to help back the next generation of great Canadian companies.
