Bootstrapped for over a decade, this Dallas company just secured $110M to help people pay bills by text

Solutions by Text, a company that gives people a way to pay their bills and apply for loans via text messaging, has secured $110 million in new growth funding.

Edison Partners and StepStone Group co-led the equity portion of the raise while Stifel Venture Bank provided a lending facility, which made up less than 15% of the total. The funding was a mix of primary and secondary shares, according to CEO David Baxter.

Solutions by Text (SBT) is not your typical startup raising capital. The company was founded in 2008 by brothers Danny and Mike Cantrell, who bootstrapped it until 2021 when Edison Partners wrote its first check into the company as part of a $35 million growth round.

Baxter took over as CEO in 2021, and the brothers have exited and are no longer involved in the day-to-day operations. Since its raise late that year, Baxter said, SBT has seen its revenue increase by “more than 3X” though he declined to say what that base revenue was. 

The company is currently EBITDA positive and is “working toward profitability” this year, according to Baxter. Over time, it has transitioned itself from a consumption model to a subscription business, with pure SaaS comprising about 90% of business by year’s end.

“We really have transformed the business from more of a founder-led family, lifestyle type of a business, doing roughly 20ish million messages a month to about 150 to 200 million messages a month,” he told TechCrunch in an interview. In 2023 alone, SBT’s messaging volume increased 95% from the prior year, according to Baxter. 

He would not disclose the company’s current valuation, saying only that it was 5x from what it was at the time of its last raise.

As the company’s name suggests, Solutions by Text provides conversational messaging tools to businesses that interact in real-time with customers via text. Its customers use it for everything from marketing to past-due collections.  

According to a research report by Solutions by Text and Datos Insights, many consumers – especially GenZers and Millienials – said they’d be willing to pay a bill within a text message.

“About 98% of text messages are opened and read in under five minutes. I look at my phone right now, I’ve got four unanswered text messages – and this is what I do for a living – but I have 1000s of unread emails,” Baxter said, noting that SBT sees itself as “an ally of the telecommunications industry.”

Concerns over compliance have kept many companies from going the text messaging route. Baxter claims that 60% of the company’s new customers were not using text messaging out of fear of violations over the last 12 months. The difficulty of compliance has also forced some customer engagement and messaging providers to exit the financial services sector, he said. 

Solutions by Text, he claims, has the compliance piece nailed down through features such as provisioned short codes and long codes/10DLCs. Customers include Best Egg, eBay, US Bank, regional banks from the Southeast and Midwest, a top 15 auto loan provider and a digital marketplace lender, among others.

“They’re all finding new ways to communicate really in real time with their customers,” Baxter said.

Last October, SBT formally entered into the embedded payments space, in partnership with Nuvei. SBT says its “FinText” product, among other things, allows consumers to make payments through text-based responses such as “Pay Now.” It also offers what the company describes as “pre-vetted, carrier approved, messaging template to ensure compliance with strict industry regulations.”

The company plans to use its new capital towards product development, accelerating its product roadmap, some R&D, seeking acquisitions and rounding out and pushing on its AI offerings, according to Baxter.

“We believe that AI will provide a rich experience. Imagine a place where you could self negotiate your debt through AI,” he said. “Levels of delinquency are on the rise and we can help create a much better way for people to self cure their debt, or make a promise to pay in a series of payments, based on business rules driven by AI.”

Edison Partners General Partner and COO Kelly Ford told TechCrunch that when she first invested in SBT two and a half years ago, she saw “a founder-led, capital-efficient business with a competitive moat that went deep on regulatory and carrier compliance and wide on financial industry solutions and third-party technology integrations.”

She added: “We doubled down on the investment because the team has overperformed on all marks and we’re keen to go faster, particularly with payments.”

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