European regulation is turning ESG reporting from a nice-to-have to a must. This creates new tailwinds for startups such as Paris-based Apiday, whose platform targets private equity funds and blue-chip companies needing to track and pilot sustainability practices.
Targeting Asset Management Firms
Asset management firms, especially European ones, have been a critical target for Apiday. Because of the Sustainable Finance Disclosure Regulation (SFDR), it is not just impact funds that monitor sustainability metrics closely: all sorts of firms are now paying attention to ESG reporting.
Adapting to a Changing Environment
This creates a different environment from when Apiday was founded in 2021, but it is also one in which ESG backlash has appeared. CEO Édouard Audi himself engages with Elon Musk’s criticism of ESG ratings and agrees that these have limits. However, his focus with Apiday is on using ESG for value creation and not merely compliance.
Series A Funding Round
The company just raised €10 million in a Series A funding round, which will help Apiday accelerate its growth in a space that includes well-funded competitors such as AlphaSense, Dataminr, Sesamm, and FactSet-owned Truvalue Labs.
Leveraging AI and Human Expertise
Like these players, Apiday leverages AI to save time for its customers. But like legacy consultants, it also offers human expertise. The combination of both gives it an edge over competitors old and new, CEO Édouard Audi told TechCrunch in an interview.
Expansion Plans
Another differentiator is its expansion plan. With clients in 23 countries and 60% of its sales generated outside of France, it plans to double down on Europe and open offices in Germany and the U.K. Since it also aims to improve its offer overall, it expects its team to grow from 40 to 70 employees over the next 12 months.
Boosting Standing Among Asset Management Firms
Audi also hopes that Apiday’s latest funding round will boost the company’s standing among asset management firms. Before co-founding Apiday with former investor Charles Moury, Audi co-founded ride-hailing company LeCab, and this journey inspired him to go into the ESG space. Compared to competitors, LeCab was doing better in some ESG-related respects, Audi said, but that wasn’t adequately taken into account in its sales due to a lack of metrics on these topics.
Future of ESG Reporting
Again, the way investors engage with ESG now is not the same as it was back then; on the corporate side, ESG reporting is about to get another boost from the Corporate Sustainability Reporting Directive (CSRD). “The importance of ESG data will increase dramatically over the next few years,” said Stanislas Lot, the partner who led the round at Daphni. Data is only the basis, though. What’s more important is what can be done with it. Friday, for instance, assists its customers with developing roadmaps, including some 350 actions they can take to improve their ESG practices after becoming compliant. Funds have already reached that phase, but Apiday expects corporates to follow, and it will be interesting to see how quickly they do.
Backers and Investors
Its Series A backers include AENU, Daphni, Galion.exe, and SWEN Capital, as well as existing investors Speedinvest and Revent.
