BNPL

July 1, 2020

Afterpay recently hit the 10M user mark (with 5M of those users in the US). It represents a growing category of companies that give consumers the option to buy now and pay later (aka BNPL). Afterpay allows e-commerce customers the option to pay for their checkout in monthly installment payments instead of a lump sum. Then, Afterpay pays the merchant right away and collects the installment payments from the customer directly.

Although Afterpay was growing pre-COVID, the economic downturn has been a boon to the business. Afterpay reports that its weekly usage rate is up 40% compared to just a few months ago.

The buy now pay later companies are usually plugged into the e-commerce platforms, working directly with brands. BNPL services have been shown to boost conversion rate on shopping websites significantly. Plus, because BNPL services don’t generally run a credit check, they’re available to people with poor credit scores.

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Buy-now-pay-later:

Klarna Bank AB, commonly referred to as Klarna, is a Swedish bank that provides online financial services such as payment solutions for online storefronts, direct payments, post-purchase payments, and more. Their core service is to assume stores' claims for payments and handle customer payments, thus eliminating the risk for the seller and buyer. The company has more than 3,000 employees, most of them working at the headquarters in Stockholm. In 2019, the company handled about $35B in online sales. About 40% of all e-commerce sales in Sweden go through Klarna.

Affirm is a privately-held financial technology company headquartered in San Francisco. Founded in 2012, the company operates as a financial lender of installment loans for consumers to use at the point of sale to finance a purchase. Since its founding, Affirm has partnered with e-commerce platforms including Shopify, BigCommerce, Peloton, and Zen-Cart.

QuadPay (recently acquired by Zip Co Limited) is a U.S. installment provider that is disrupting the traditional credit card industry. QuadPay’s mission is to give savvy shoppers more freedom and flexibility with the option to pay in four interest-free installments over six weeks. Driven by a strong focus on innovation and customer-centricity, the company has developed a market-leading app with 1.2M downloads and was among the first in the US market to launch virtual card technology. This tech enables seamless integration for merchants while allowing its 1.5M customers to shop online and in-store, not just with QuadPay’s 3,500 integrated merchants, but with leading global retailers.

Funding & Deal Highlights:

PopCom, an automated retail technology company specializing in vending and kiosk solutions, completes its second equity crowdfunding campaign on Start Engine, raising $1.3M in 47 days, according to a press release.

Advantage Capital announces a $5M investment in Pearson-based Cady Bag—a leading producer of polypropylene fabrics and bags—in connection with the Georgia Agribusiness and Rural Jobs Act (GARJA). The investment will help the company weather the economic impact of COVID-19 and its aftereffects, preserve its current jobs, and support continued business and job growth.

WEX announces a $400M investment from Warburg Pincus.

DefinedCrowd, a Seattle, WA-based data provider for artificial intelligence, raised (in May 2020) an additional $50.5M in a Series B funding round.

Cybersecurity startup Cynet announces it has closed an $18M funding round. It plans to use the investment to expand its presence in the U.S. and international markets, specifically on the sales side as it seeks to increase brand awareness and bolster its channel ecosystem.

Pactum, a Mountain View, CA-based AI-based platform that enables global companies to automate personalized commercial negotiations on a massive scale, closes a $3M seed financing.

Outdoor Voices, an activewear brand on a mission to 'Get the World Moving,' announces it has successfully raised a new round of funding from NaHCO3, the investment management platform of fashion and retail entrepreneur Ashley Merrill. In conjunction with this equity investment, Merrill, who is focused on supporting organizations with the potential for lasting impact, has joined Outdoor Voices' Board of Directors as Chairwoman. Financial terms of the private investment were not disclosed.

Codefresh, the leader in Kubernetes DevOps tools, announces $27M in new funding led by Red Dot Capital Partners with participation from Shasta Ventures and existing investors. Total funding for Codefresh has now more than doubled to $42M.

Sun Genomics, the direct-to-consumer custom probiotics and gut health company, announces $8.65M in Series A funding. The round was led by Pangaea Ventures with additional investments from Danone Manifesto Ventures, SOSV, Human Longevity, and Nascita Ventures. Chris Erickson, Founding General Partner at Pangaea Ventures, has joined as a new Board member.

Arthur J. Gallagher & Co. has acquired Meridian, Idaho-based Cunnington & Associates Inc.

Coty will acquire a 20% stake in Kim Kardashian West's makeup brand, KKW Beauty, in a $200M deal.

Medical tech firm Brainlab acquires Level Ex surgery game startup.

Since last week, PrivCo has added:
908 Profiles Updates | 176 M&A Deals | 172 Funding Activities
Revenues, EV, EBITDA, and Valuations

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