It was long-rumoured that Sebastian Diemer, who co-founded credit scoring and loans company Kreditech, was doing another startup in the fintech space and today that new venture de-cloaks. Bezahlt.de, which, along with Diemer, counts numerous other ex-Kreditech employees as part of its founding team, is taking aim at the German ‘factoring’ market.

Invoice factoring (or invoice financing) is where companies secure credit by selling outstanding invoices to a third party, called a factor, at a discount, hence freeing up liquidity in the business. I’m told that the German factoring market alone was more than 200 billion Euros in transactions last year, the largest in Europe, with a growth rate of 10 percent over the last six years.

To that end, Bezahlt is specifically targeting the self-employed and freelancers — the “WeWork generation” — and small and medium enterprises (SMEs) who, it claims, have yet to benefit from the advantages of factoring that many corporate players take for granted.

“The problem we are trying to solve is to provide freelancers, small companies and startups with fast, easy and cheap [factoring],” says Diemer, Bezahlt’s co-founder and CEO. “This customer group is ignored by banks and other financial institutions that offer factoring services that have largely been directed almost exclusively at large corporates and companies with minimum sales of 100,000 Euros”.

It plans to do this with better scoring technology, thus taking a page out of the Kreditech playbook, and accepting invoices from as little as 1 Euro. There is also no minimum sales volume and no bank history necessary, whilst still resulting in a success rate of about 70 per cent, apparently. The first invoice is free after which the startup charges a 2.3 to 3.3 per cent monthly fee on the amount invoiced.

Diemer says that Bezahlt can provide a better product by fully automating the scoring process and through smarter customer acquisition, “resulting in lower variable cost, better scoring and higher scalability”. This will enable the startup to offer factoring to “basically everyone who has a desk at WeWork, Mindspace or any other co-working space”.

“That means the service focuses on freelancer, startups and SMEs that are largely ignored by banks. However also established startups and SMEs will find the service interesting as there are no general assignments or any other limiting factors. The first bill to be factored is always for free too,” he adds.

Meanwhile, I’ve learned that Bezahlt is backed to the tune of €3.5 million with a mixture of equity and debt. Investors include Point Nine Capital, Fly.vc, German Startup Group, La Famiglia, Michael Brehm, Heiko Hubertz, Raffael Johnen (CEO Auxmoney), Marcus Börner (CEO Optiopay), and a number of unnamed banks.

Noteworthy is that Kreditech’s other co-founder and current CEO, Alexander Graubner-Müller, and the company’s former CIO, Andrew Shaw, are also described as founding investors in Bezahlt.