ANBLIK Weblog

Building-industry credit processor BlueTarp Financial Inc. received $18.5 million in Series B financing this week, which company officials expect will propel it to profitability for the first time since it was founded in Portland, Maine, in 2000.
CEO Bond Isaacson said the equity capital is earmarked to move outsourced operations in-house, while increasing the customer base of building suppliers. Both efforts are expected to position the company for either a public stock offering or acquisition in three to five years, Bond Isaacson said.
“This funding was to reach profitability and be generating revenue so any future fundings of the company would have a much higher valuation,” Bond Isaacson said.
BlueTarp manages back-office receivables for building suppliers. It is based in Charlotte, N.C., but maintains the bulk of its payroll in Portland: 45 of its 55 people are there, officials said.
Its technology enables commercial contractors to view orders, deliveries and payments via the web. BlueTarp receives a percentage of transactions.
California’s Trinity Ventures led the VC round, with Lexington’s Highland Capital Partners, Boston’s IDG Ventures and Williamstown, Mass.-based Village Ventures also participating.
It was during its $14 million first VC round in 2004 that BlueTarp changed its future — along with its business model, Highland Capital managing general partner Paul Maeder said.
Previously, BlueTarp had targeted general contractors to use BlueTarp credit cards and then outsourced the processing. In 2004, VCs recruited Bond Isaacson to restructure the business model, and BlueTarp targeted suppliers instead of contractors and eliminated the cards, sending transactions directly from suppliers to BlueTarp’s Portland office. The restructuring has meant more customers and profitability this year, Maeder said. “Right now it’s a high-growth business with interesting dynamics,” Bond Isaacson said.
BlueTarp serves 550 building-material stores and 12,500 U.S. building contractors. Bond Isaacson declined to disclose BlueTarp’s revenue figures, but said the company tripled sales last year.