Modernising Debt Collection: A Conversation with Matteo Benedetti (Debtist)
How to sell B2B software to SMEs and large enterprises in an underserved market and why founders should choose their first investors wisely.
We sat down with Matteo Benedetti, Co-Founder and Co-CEO of Debtist — one of the first eight portfolio companies backed by Europe’s SME Tech fund āltitude — to find out how their team is transforming the traditionally outdated and inefficient debt collection industry.
With roots in SaaS and business operations, Matteo and his co-founders, Tony Zabel and Brandon Baumgarten, identified a significant market gap and launched Debtist to empower SMEs and large enterprises, combining cutting-edge technology with a mission to make debt collection less confrontational and more collaborative.
In this exclusive interview, Matteo dives into the company’s rapid growth, their Go-To-Market (GTM) strategy, and why partnering with āltitude has been pivotal in scaling their business.
Could you share a bit about Debtist’s mission and the problem you’re solving? What sparked the idea to build this solution and how did you and your co-founders come together to start your company?
Debtist was founded to modernise the debt collection industry by providing SMEs and large enterprise clients in Europe with a seamless, transparent, and tech-driven solution to manage outstanding invoices. The sector is traditionally plagued by inefficiency and outdated practices – SMEs, in particular, often face significant cash flow challenges due to unpaid invoices, with incumbent solutions being either overly aggressive or inflexible, leaving them with very limited options. Accordingly, our mission is to revolutionise debt collection, making it less about confrontation and more about collaboration, preserving client relationships while ensuring financial stability for our customers.
The idea for Debtist emerged from our co-founding team’s shared experience in Software-as-a-Service (SaaS) and business operations, including my time as a consultant at McKinsey, where I worked mainly on banking- and FinTech-related projects and noticed that there was a lack of innovation in the debt collection industry. Recognising a significant market gap, my co-founders and I combined our expertise and came up with the vision to create a platform that is primarily tailored to the needs of SMEs as well as larger enterprise clients, empowering them to manage outstanding payments efficiently while fostering their sustainable growth.
Can you explain a bit more about the market you’re operating in with a focus on SMEs – what makes your solution unique and why is Debtist seeing such rapid growth so early in your journey?
The debt collection industry is highly legacy-driven and fragmented, especially when it comes to SMEs. Larger enterprises often encounter excessive fees and a disconnected, non-customer-centric experience. At Debtist, we address this by adopting the client’s perspective, streamlining workflows to deliver exceptional quality while minimising touchpoints for a seamless and efficient process.
Many smaller companies either face excessive acquisition costs or lack the tools to integrate into existing software effectively as traditional debt collection services are often designed for large enterprises with complex systems and high budgets.
Debtist addresses this by integrating directly into widely-used accounting tools, allowing SMEs as well as large enterprises to handle debt recovery with a single click. This drastically reduces acquisition and integration costs while delivering a user-friendly experience. Our focus on SMEs while also going upmarket, closing larger enterprises as clients, has allowed us to see rapid traction, achieving several million Euro in debt realisations for our clients and over €3.5 million in annual recurring revenue since we launched our solution in July 2023.
What does your Go-To-Market (GTM) strategy with respect to SMEs look like? How do you ensure that you’re selling your product to SMEs effectively?
Our GTM strategy is built on two key pillars: integration and education. By integrating directly with accounting and other software platforms that SMEs already use, we eliminate barriers to adoption. This embedded approach makes it easy for businesses to start using Debtist without changing their existing workflows. On the education front, we focus on building trust and awareness through content marketing, webinars, PR and events, addressing the specific challenges SMEs face with debt collection.
Additionally, we engage directly with SMEs at industry conferences and meetups, creating opportunities for dialogue and feedback. We’ve also adopted a highly targeted sales approach, prioritising SMEs that are most likely to benefit from our solution. By understanding their pain points and demonstrating how Debtist can solve them efficiently, we’ve built strong client relationships and a solid foundation for scaling.
Fundraising is often a critical challenge for startups. Can you walk us through Debtist’s journey to raising your pre-seed round in 2023? What were some of the biggest hurdles and milestones during this process?
Raising our pre-seed round in 2023 – a generally difficult year for startup funding – was an intense yet rewarding process. Over the course of 100+ pitches, we refined our story and strategy to align with what investors were looking for. One of the biggest challenges was positioning ourselves in a way that demonstrated both the size of the opportunity in the debt collection space and our ability to execute on it.
A key milestone was securing āltitude as our lead investor, alongside 10x Value Partners and several strategic business angels. This funding not only validated our vision but also gave us the resources to enhance our platform and grow our team. The experience taught us the importance of persistence and the value of building relationships with investors who understand your mission. Ultimately, we raised a high six-figure investment, which validated our vision and gave us the resources to start scaling our operations and continue improving our product.
Why did you decide to partner with āltitude as the only VC fund for your pre-seed round? What stood out to you about their approach or expertise that made them a great fit for Debtist?
We chose āltitude as the only VC fund in our cap table at this early stage because of their deep understanding of the SME tech ecosystem and their commitment to backing transformative solutions for underserved markets. Their team’s complementary expertise, extensive network, and proven experience in scaling early-stage B2B software companies aligned perfectly with our needs, making them an ideal partner for Debtist. From the outset, āltitude demonstrated their ability to add value beyond capital, proactively supporting our mission and shaping our early success – may it be through important introductions to sales leads or hands-on support in PR and marketing. Knowing we had a partner who believed in our vision and had the tools to help us succeed made them an obvious choice.
How has āltitude supported Debtist beyond capital? Can you share any specific instances where their involvement helped you tackle a challenge or seize an opportunity?
āltitude has been instrumental in helping us refine our strategy and amplify our visibility in the market. For example, their support during our pre-seed funding announcement led to media coverage in numerous publications, significantly boosting our brand awareness. This visibility has had a direct impact on lead generation and our ability to attract new clients.
They’ve also been a sounding board for critical decisions, from refining our GTM strategy to identifying opportunities for operational efficiency. Their hands-on approach and willingness to connect us with industry experts have been invaluable as we navigate the complexities of scaling.
Last but not least, the SME Tech Leaders community that āltitude initiated provides us with a great peer-to-peer support network, enabling us to learn from other founders and operators that are building digital solutions for SMEs in Europe.
What advice would you give to founders who are seeking strategic early-stage investors? What qualities or values should they prioritise in their search for the right VC partners?
When selecting pre-seed investors, prioritise those who bring more than capital and have a track record of supporting companies like yours. Look for partners who understand your market, provide real value, and align with your strategic vision.
It’s also important to establish a strong personal connection with your investors, as this sets the foundation for a collaborative and trusted relationship over the long term. The right early-stage VC firm will basically have as much skin in the game as you have, providing the insights and resources you need to tackle challenges and seize opportunities.
Since raising your pre-seed round, what major milestones or growth achievements has Debtist reached?
Since closing our financing round, we’ve achieved several key milestones. We’ve grown our team to 30 people, onboarded dozens of clients, and are on track to recover a low 9-digit amount in debt for our clients. Most importantly, we reached and maintained profitability within months of launching, a testament to our efficient business model and strong market demand.
We’ve also made significant enhancements to our platform, integrating with additional accounting tools and payment service providers like Stripe, greatly expanding our capabilities to better serve our clients. These achievements have positioned us well for the next phase of our company’s growth.
Looking ahead, what are the next big goals you’re working on as a company, and how do you plan to achieve them?
Our key goals for next year include doubling our team size, reaching €10 million annual recurring revenue, and expanding our product offerings to include invoicing solutions, further integrating into our clients’ workflows. We’re also looking to increase our market penetration across Europe while maintaining profitability.
To achieve these goals, we’ll continue to leverage our proprietary technology, deepen our integrations with other platforms, and build strategic partnerships that enhance our value proposition. Staying fully client-focused will be key to our success.
Lastly, what is your favorite book, and why is it meaningful?
One book that has deeply influenced me is “The Lean Startup” by Eric Ries. Its principles of iterative development and validated learning resonate with how we approach building our product and company overall. It reminds me of the importance of staying close to your customers and continuously improving based on their feedback — a philosophy that drives everything we do at Debtist.
Thank you for the interview, Matteo!