Profitably raises funding to cull data for small businesses

New York startup Profitably recently closed a $300,000 round of funding with a group of New York investors. The company offers an online software application that analyzes data from Quickbooks, a small business accounting package sold by Intuit.  The “data-driven” business model employed by companies that extract (or “mine”) valuable information from data has been gaining steam in many segments of the software industry.

Profitably value proposition is quite similar to that of Mint.com, another “data-driven” software company that Intuit acquired at the end of last year for $170 million. Even more, after the acquisition, Mint.com’s reach has continued to soar and Intuit even decided to replace its own Web-based personal finance product, Quicken Online, with Mint.com.

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By accessing user or business bank accounts, such companies can aggregate and analyze transaction information to provide users with valuable insights into their businesses.  Though there has been some conjecture around Intuit’s plans for Mint.com in the small business segment, Profitably is an Intuit partner and has integrated its software with QuickBooks in order to extract relevant information at the user’s request.

Profitably chief executive Adam Neary mentioned that while other software packages may offer the ability to aggregate disparate data, “our focus is on providing a simple and intuitive view of our customers’ business data with specific recommendations to drive growth and improve profitability.“  The company is entering its beta testing period this week and has already seen strong interest from customers and certified public accountants.

Indeed, other companies, such as InDinero, offer simple finance tools for small businesses. Nevertheless, Neary stated that he sees his value measured less against other accounting packages and more as a viable alternative to expensive business consulting engagements thanks to the strength of the product’s data analysis engine and user interface design.

In an unusual move for an initial angel round of funding, the $300,000 investment was lead by venture capital firm, North Bridge Venture Partners, with individual NY-based investors such as Mark Birch, David Tisch, David Honig and Chirag Chaman participating as well.

Profitably has employs three full-time people and is one of 150 graduates of the Founder Institute, a four month apprenticeship and entrepreneur training program affiliated with TheFunded site for reviewing venture capitalists.

Disclosure: I have previously talked to the Founder Institute about an unrelated partnership.