A decade ago, SumUp was one of the fintech armies that made their name with dongles that turned basic phones into card payment terminals. The London-based company has now expanded into a wider range of business services used by 4 million small and medium-sized businesses in 35 markets, and as its intentions continue to grow, it is closed to a large round of financing. 590 million euros ($ 624 million).
The money will be used for purchases, more recruitment (it now employs about 3,000 people) and the development of more organic products, the company said.
The investment, which is led by But Capital Tech Opportunities, with the participation of funds managed by BlackRock, btov Partners, Centerbridge, Crestline, Fin Capital and Sentinel Dome Partners and others, will be in the form of 50% capital and 50% debt. and SumUp estimates it at $ 8 trillion ($ 8.5 trillion).
SumUp has raised around € 1.5 billion over the last ten years, but most of it has been in debt (including last year’s € 750 million debt round).
Marc-Alexander Christ, founder and CEO of SumUp, said in an interview that in fact, less than 100 million euros worth of assets before this round, which is a relatively low dilution despite these large amounts, and few that has been. a mode of transparency in the valuation of the company.
Covid-19 has personally slowed down a lot of trade, which has had a huge impact not only on traders, but also on individuals and businesses working in their trading ecosystems. The solution for a company like SumUp – the bread and butter of its business, point-of-sale payments is essentially part of that personal shopping experience – has been to diversify and duplicate a wider range of services for its small businesses. retail customers.
To do this, it has used significant parts of its debt so far to make purchases and build more services beyond POS payments, including business banking (which offers a free basic version), online payments and business services.
This is part of how space has evolved. While others in the same business as SumUp have diversified into areas like cryptocurrency (here with the original player, to the point of being renamed Square, Block), or even caught larger fish (see PayPal getting iZettle), SumUp has positioned SMB as a fintech fintech unifier du.
In a highly fragmented space, the company has taken over to complete and expand its payment platform, such as Payleven (Rocket’s “Square Clone” was created on the Internet), Goodtill, Tiller, and a US-based customer loyalty start-up, Fivestars. And when you consider all the elements involved in buying and selling goods and services, SumUp has many areas left to deal with: big data analytics, more tools to build, manage and optimize, online sales experience for its customers, more technology in physical shopping experiences to improve how items are sold, etc. – to all areas that SumUp can approach by building its technology or through more M&A.
It’s a strategy that has worked, it seems: in total, SumUp’s revenue has grown 60% annually over the past two years, Christ said. He added that 10% of its 4 million companies use business banking, making SumUp “the world’s largest neobank for SMEs”.
However, reversing this statistic, POS payments account for the bulk of the company’s revenue, so 60% growth is not a sign that SumUp has been able to grow this business over the past two years, but is a personal area for transactions in personal and point-of-sale payments. he continued.
And the same could be said of the company’s overall strategy. According to SumUp, which is now in 35 markets and is moving to more and more emerging countries – its last presentation was in Peru – its original market remains the largest in Europe at the moment. “It is clear that Europe is the power, the EMEA is still the driving force behind the new revenue,” said Michael Schrezenmaier, the company’s chief regional officer.
“SumUp has been constantly evolving to enable small businesses to grow and diversify their payment solutions and tools to effectively connect with their day-to-day consumers,” said Darren Abrahamson, MD of Bain Capital Tech Opportunities. “SumUp’s leadership team has led the company’s sustainable growth and acceleration to more than 30 countries where they have had a direct and positive impact on the small business ecosystem. We are proud to contribute our deep fintech and payment experience to SumUp’s outstanding ability to push the boundaries and lead a highly competitive industry. “