Scott’s Addition-based tech startup Fringe scores $6M capital raise

Fringe, a local tech startup based in Scott’s Addition, has recently secured a $6 million capital raise. This funding, according to CEO and co-founder Jordan Peace, will help the company refine its software and operations as it focuses on partnering with larger benefits providers. This shift towards partnerships with industry leaders like Alight and ADP, which began a couple of years ago, is part of Fringe’s strategy to enhance profitability and reach a larger audience.

Instead of immediately scaling up their operations with the funds received, Peace emphasized that this capital raise provides a runway for Fringe to work towards profitability without rushing into hiring or expansion. The company is currently working on integrating its services into larger employer-facing companies, enabling them to offer Fringe’s offerings through their own platforms. By partnering with companies like ADP and Alight, Fringe has the potential to reach up to 50 million users, significantly expanding its user base.

Peace highlighted that Fringe’s partnership strategy is geared towards collaborating with industry leaders to enhance value for their customers and capture a larger share of the market. In addition to its existing partnerships, Fringe is exploring similar arrangements with other companies that can benefit from their services, such as lifestyle spending accounts or awards marketplaces.

The decision to pivot towards partnerships with larger companies reflects the evolving landscape of the industry. Peace noted that human resource directors are increasingly looking for streamlined solutions instead of managing multiple vendors for different benefits and payroll services. By offering a comprehensive solution through these partnerships, Fringe aims to meet the changing needs of its target market.

The recent fundraising round was led by prominent figures such as Ron Clarke of CorPay, with participation from other notable investors like Origin Ventures, Sovereign’s Capital, and the Felton Group. With its headquarters in Scott’s Addition and a growing customer base of 300 companies, including names like Shipt and Chegg, Fringe continues to offer its employee benefits marketplace. This platform provides access to personalized benefit packages featuring perks like streaming services and food delivery, with 150 vendors currently on board.

Despite having a team of around 40 employees, half of whom are local, Peace mentioned that the company had downsized from its previous headcount of twice as many employees. However, he revealed that they plan to hire five more employees following the recent capital raise. This strategic move aligns with Fringe’s focus on maintaining profitability and sustainable growth in the coming period.