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Extra Crunch roundup: BNPL bonanza, scraping Toast’s S-1/A, early-stage SaaS pricing
Are founders in fundraising mode short-sighted when it comes to working with Chinese venture funds?
Runa Capital’s Asia business development manager Denis Kalinin studied data from iTjuzi, a database of Chinese venture capitalists, and found:
“…Chinese funds invested around $250 billion in 2020 (three times higher than the figure reported in Crunchbase). This figure puts Chinese VC investments only 30% lower than investments by U.S. funds, but three times that of U.K. funds and 12.5 times more than German funds.”
The pandemic, geopolitical tensions and other factors led many Chinese venture funds to pare back their international investments, but that’s largely “because during COVID, China’s economy recovered much faster than other countries’,” writes Kalinin.
His analysis covers multiple angles: Chinese investments in Europe are catching up with those in Asia and the United States, half of China’s top cross-border investors are CVCs, and investors are particularly interested in fintech, deep tech and digital health at the moment.
“Chinese investors can bring value to foreign startups, but you need to study their expertise and how it can be useful for you.”
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Today at 2 p.m. PT/5 p.m. ET on Twitter Spaces, Managing Editor Danny Crichton and immigration law attorney Sophie Alcorn will discuss whether remote work is making H-1B visas less critical for international founders.
It’s a provocative question: If remote teams are becoming the norm, tech hubs are decentralizing and investors are comfortable cutting checks after a Zoom call, how important is it to do business as a startup inside the U.S?
It’s sure to be an interesting conversation; to get a reminder, please follow @TechCrunch on Twitter.
Thanks very much for reading Extra Crunch this week!
Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist
Toast looks toward $18B valuation in upcoming IPO
Image Credits: Nigel Sussman (opens in a new window)
Toast released an early IPO price range of $30 to $33 per share on Monday, and Alex Wilhelm digs into the S-1/A filing to “better understand how to value vertical SaaS startups that are pursuing a payments-and-SaaS business approach.”
Is the restaurant software startup worth the $18 billion valuation it’s aiming for?
3 keys to pricing early-stage SaaS products
Image Credits: Peter Dazeley (opens in a new window) / Getty Images
Every founder who launches an enterprise software startup has to figure out the “right” pricing model for their products.
It’s a consequential decision: Per-seat licenses are easy to manage, but what if customers prefer a concurrent licensing model?
“Early pricing discussions should center around the buyer’s perspective and the value the product creates for them,” says Ridge Ventures partner Yousuf Khan, who previously worked as a CIO.
“Of course,” he notes, “self-evaluation is hard, especially when you’re asking someone else to pay you for something you’ve created.”
Is India’s BNPL 2.0 set to disrupt B2B?
Image Credits: jayk7 / Getty Images
India’s mom-and-pop businesses are experiencing a digital transformation that’s creating new e-commerce opportunities; smartphones have replaced paper records, and a new government-backed instant payments system is disrupting how value is exchanged.
But instead of importing legacy credit systems, buy now, pay later systems are the “next step for solving the digital B2B puzzle,” writes Anubhav Jain, co-founder and CEO of Rupifi.
What to make of Freshworks’ first IPO price range
Image Credits: scyther5 / Getty Images
Freshworks, which develops and offers a variety of business software tools, set an IPO price range of $28 to $32 per share on Monday, meaning its valuation could reach nearly $10 billion, Alex Wilhelm writes.
“It appears that the Freshworks IPO is pretty reasonably priced as is, though a boost to its price range is not out of the question if public market investors decide that they are bullish on its future growth prospects. We just don’t see dramatic upside.”
ish on its future growth prospects. We just don’t see dramatic upside.”
Here’s what your BNPL startup could be worth
Image Credits: Nigel Sussman (opens in a new window)
The multibillion-dollar exits of Japanese startup Paidy (to PayPal) and Australian buy now, pay later company Afterpay (to Square) “provided hard market proof that what BNPL startups are building has value beyond simple operating results,” Alex Wilhelm writes in The Exchange.
He breaks down the value of Afterpay, Paidy and Klarna using a simple metric: What would you pay for $1 of BNPL GMV?
3 methodologies for automated video game highlight detection and capture
Image Credits: mikkelwilliam (opens in a new window) / Getty Images
Video game livestreaming is booming.
Twitch has an average of almost 3 million concurrent viewers; by comparison, on the night of the 2020 U.S. presidential election, CNN’s livestream averaged 1.1 million.
The most successful streamers use their ad revenue and sponsorship money to hire video editors and social media teams to make them look good, but new automated tools are giving part-time streamers the ability to spotlight their best moments as well.
Have ‘The Privacy Talk’ with your business partners
Image Credits: Boris Zhitkov (opens in a new window) / Getty Images
A data breach costs a company an average of $3.8 million, Marc Ellenbogen, Foursquare’s general counsel, notes in a guest post, adding up to a “concrete financial incentive to having The Privacy Talk.”
What is it?
“It’s the conversation that goes beyond the written, publicly posted privacy policy and dives deep into a customer, vendor, supplier or partner’s approach to ethics,” he writes.
If you think the talk doesn’t apply to you, think again.
Advanced rider assistance systems: Tech spawned by the politics of micromobility
Image Credits: Alexander Spatari (opens in a new window) / Getty Images
In an effort to “reassure local administrations that micromobility is safe, compliant and a good thing for cities,” scooter operators are “implementing technology similar to advanced driver assistance systems (ADAS) usually found in cars,” Rebecca Bellan writes.
She breaks down how the tech could help prevent unwanted behavior and explores the cost for scooter operators and opportunities for startups.
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Here’s what your BNPL startup could be worth
It’s a two-Exchange Tuesday, everyone. First up, we’re talking fintech valuations. Next up, we’re digging into Atlanta.
Last week’s news that PayPal intends to buy Japanese startup Paidy marked the second major acquisition of a buy now, pay later (BNPL) company this year. PayPal’s news followed an even larger deal by Square for the Australian BNPL company Afterpay.
The multibillion-dollar exits provided hard market proof that what BNPL startups are building has value beyond simple operating results; major fintech platforms are willing to shell out large sums for their revenues and possible strategic value.
The Exchange explores startups, markets and money.
Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.
Because both deals happened in 2021, they provide two data points for the value of BNPL companies operating at scale. And because both Square and PayPal provided some information to their investors concerning their transactions, we have a little bit of comparative work to do.
Let’s do a little math and figure out how much PayPal and Square investors are paying for transaction volume across both platforms. Then, we’ll peek at what Affirm is worth along similar lines. We’ll wrap with a look at Klarna’s numbers to see if there’s anything we can dig up there.
Our goal is to find out what sort of price floor or ceiling the Paidy and Afterpay deals imply, if other players in their space are matching that figure, and why. This will be fun!
What would you pay for $1 of BNPL GMV?
Square’s Afterpay deal is worth some $29 billion, a huge sum. It isn’t hard to see why the U.S. consumer- and business-focused fintech is willing to write so large a check — Afterpay does volume.
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Nuula raises $120M to build out a financial services ‘super app’ aimed at SMBs
A Canadian startup called Nuula that is aiming to build a super app to provide a range of financial services to small and medium businesses has closed $120 million of funding, money that it will use to fuel the launch of its app and first product, a line of credit for its users.
The money is coming in the form of $20 million in equity from Edison Partners, and a $100 million credit facility from funds managed by the Credit Group of Ares Management Corporation.
The Nuula app has been in a limited beta since June of this year. The plan is to open it up to general availability soon, while also gradually bringing in more services, some built directly by Nuula itself but many others following an embedded finance strategy: business banking, for example, will be a service provided by a third party and integrated closely into the Nuula app to be launched early in 2022. Alongside that, the startup will also be making liberal use of APIs to bring in other white-label services, such as B2B and customer-focused payment services, starting first in the U.S. and then expanding to Canada and the U.K. before expanding further into countries across Europe.
Current products include cash flow forecasting, personal and business credit score monitoring, and customer sentiment tracking; and monitoring of other critical metrics including financial, payments and e-commerce data are all on the roadmap.
“We’re building tools to work in a complementary fashion in the app,” CEO Mark Ruddock said in an interview. “Today, businesses can project if they are likely to run out of money, and monitor their credit scores. We keep an eye on customers and what they are saying in real time. We think it’s necessary to surface for SMBs the metrics that they might have needed to get from multiple apps, all in one place.”
Nuula was originally a side-project at BFS, a company that focused on small business lending, where the company started to look at the idea of how to better leverage data to build out a wider set of services addressing the same segment of the market. BFS grew to be a substantial business in its own right (and it had raised its own money to that end, to the tune of $184 million from Edison and Honeywell). Over time, it became apparent to management that the data aspect, and this concept of a super app, would be key to how to grow the business, and so it pivoted and rebranded earlier this year, launching the beta of the app after that.
Nuula’s ambitions fall within a bigger trend in the market. Small and medium enterprises have shaped up to be a huge business opportunity in the world of fintech in the last several years. Long ignored in favor of building solutions either for the giant consumer market, or the lucrative large enterprise sector, SMBs have proven that they want and are willing to invest in better and newer technology to run their businesses, and that’s leading to a rush of startups and bigger tech companies bringing services to the market to cater to that.
Super apps are also a big area of interest in the world of fintech, although up to now a lot of what we’ve heard about in that area has been aimed at consumers — just the kind of innovation rut that Nuula is trying to get moving.
“Despite the growth in services addressing the SMB sector, overall it still lacks innovation compared to consumer or enterprise services,” Ruddock said. “We thought there was some opportunity to bring new thinking to the space. We see this as the app that SMBs will want to use everyday, because we’ll provide useful tools, insights and capital to power their businesses.”
Nuula’s priority to build the data services that connect all of this together is very much in keeping with how a lot of neobanks are also developing services and investing in what they see as their unique selling point. The theory goes like this: banking services are, at the end of the day, the same everywhere you go, and therefore commoditized, and so the more unique value-added for companies will come from innovating with more interesting algorithms and other data-based insights and analytics to give more power to their users to make the best use of what they have at their disposal.
It will not be alone in addressing that market. Others building fintech for SMBs include Selina, ANNA, Amex’s Kabbage (an early mover in using big data to help loan money to SMBs and build other financial services for them), Novo, Atom Bank, Xepelin and Liberis, biggies like Stripe, Square and PayPal, and many others.
The credit product that Nuula has built so far is a taster of how it hopes to be a useful tool for SMBs, not just another place to get money or manage it. It’s not a direct loaning service, but rather something that is closely linked to monitoring a customers’ incomings and outgoings and only prompts a credit line (which directly links into the users’ account, wherever it is) when it appears that it might be needed.
“Innovations in financial technology have largely democratized who can become the next big player in small business finance,” added Gary Golding, General Partner, Edison Partners. “By combining critical financial performance tools and insights into a single interface, Nuula represents a new class of financial services technology for small business, and we are excited by the potential of the firm.”
“We are excited to be working with Nuula as they build a unique financial services resource for small businesses and entrepreneurs,” said Jeffrey Kramer, Partner and Head of ABS in the Alternative Credit strategy of the Ares Credit Group, in a statement. “The evolution of financial technology continues to open opportunities for innovation and the emergence of new industry participants. We look forward to seeing Nuula’s experienced team of technologists, data scientists and financial service veterans bring a new generation of small business financial services solutions to market.”
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PayPal acquires Japan’s Paidy for $2.7B to crack the buy now, pay later market in Asia
PayPal Holdings, the U.S. fintech company, announced an acquisition of Paidy, a Japanese buy now, pay later (BNPL) service platform, for approximately $2.7 billion (300 billion yen), mostly in cash, to enhance its business in Japan.
The transaction completion, including the regulatory approval, is expected in the fourth quarter of 2021.
After the acquisition, the Japan-based company will continue to operate its existing business and maintain the brand while the leaders, Paidy’s president and CEO Riku Sugie and founder and executive chairman Russell Cummer, keep their positions.
Japan is the third largest e-commerce market in the world, and so this is a significant move by PayPal to gain more market share both in the country and the region, specifically in the area of providing deferred payment services as an alternative to credit cards.
PayPal has long played nice with payment cards — users can upload details of their cards to PayPal and use it as a kind of digital wallet to manage how they pay for things online through it — but it got its start actually as a payment platform in itself, where people could pay into and out of PayPal accounts. Paidy is, in that sense, a strengthening of PayPal’s first-party rails, providing a way to “own” that flow of money on its own infrastructure, not involving the card networks.
Paidy is basically a two-sided payments service, acting as a middleman between consumers and merchants in Japan. Using machine learning it determines the creditworthiness of a consumer related to a particular purchase, and then it underwrites those transactions in seconds, guaranteeing payments to merchants. Consumers then make deferred payment to Paidy for those goods.
Paidy’s platform, which offers a monthly payment installment service branded “3-Pay”, enables shoppers to make purchases online and then pay for them each month in a consolidated bill at a convenience store or via bank transfer.
“Paidy pioneered buy now, pay later solutions tailored to the Japanese market and quickly grew to become the leading service, developing a sizable two-sided platform of consumers and merchants,” said Peter Kenevan, vice president, head of Japan at PayPal.
Paidy has more than 6 million registered users, and the plan is to integrate PayPal and other digital and QR wallets with Paidy Link to connect further online and offline merchants.
In April 2021, the Japan-based company launched Paidy Link, allowing users to link digital wallets with their Paidy account. PayPal was the first digital wallet partner to integrate with Paidy Link.
“PayPal was a founding partner for Paidy Link and we look forward to looking together to create even more value,” Sugie said in a statement.
“Japan has been a vibrant environment for our growth to date and we’re honored to have our team’s hard work and potential recognized by a global leader. Together with PayPal, we will be able to further achieve our mission of taking the hassle out of shopping,” Cummer said.
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Ramp and Brex draw diverging market plans with M&A strategies
Earlier today, spend management startup Ramp said it has raised a $300 million Series C that valued it at $3.9 billion. It also said it was acquiring Buyer, a “negotiation-as-a-service” platform that it believes will help customers save money on purchases and SaaS products.
The round and deal were announced just a week after competitor Brex shared news of its own acquisition — the $50 million purchase of Israeli fintech startup Weav. That deal was made after Brex’s founders invested in Weav, which offers a “universal API for commerce platforms.”
From a high level, all of the recent deal-making in corporate cards and spend management shows that it’s not enough to just help companies track what employees are expensing these days. As the market matures and feature sets begin to converge, the players are seeking to differentiate themselves from the competition.
But the point of interest here is these deals can tell us where both companies think they can provide and extract the most value from the market.
These differences come atop another layer of divergence between the two companies: While Brex has instituted a paid software tier of its service, Ramp has not.
Earning more by spending less
Let’s start with Ramp. Launched in 2019, the company is a relative newcomer in the spend management category. But by all accounts, it’s producing some impressive growth numbers. As our colleague Mary Ann Azevedo wrote:
Since the beginning of 2021, the company says it has seen its number of cardholders on its platform increase by 5x, with more than 2,000 businesses currently using Ramp as their “primary spend management solution.” The transaction volume on its corporate cards has tripled since April, when its last raise was announced. And, impressively, Ramp has seen its transaction volume increase year over year by 1,000%, according to CEO and co-founder Eric Glyman.
Ramp’s focus has always been on helping its customers save money: It touts a 1.5% cash back reward for all purchases made through its cards, and says its dashboard helps businesses identify duplicitous subscriptions and license redundancies. Ramp also alerts customers when they can save money on annual versus monthly subscriptions, which it says has led many customers to do away with established T&E platforms like Concur or Expensify.
All told, the company claims that the average customer saves 3.3% per year on expenses after switching to its platform — and all that is before it brings Buyer into the fold.
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Product School raises $25M in growth equity to scale its product training platform
Traditional MBA programs can be costly, lengthy and often lack the application of real-world skills. Meanwhile, big global brands and companies who need product managers to grow their businesses can’t sit around waiting for people to graduate. And the edtech space hasn’t traditionally catered to this sector.
This is perhaps why Product School says it has secured $25 million in growth equity investment from growth fund Leeds Illuminate (subject to regulatory approval) to accelerate its product and partnerships with client companies.
The growth funding for the company comes after bootstrapping since 2014, in large part because product managers (PMs) are no longer needed just inside tech companies but have become sought after across almost virtually all industries.
Product School provides certificates for individuals as well as team training, and says it has experienced an upwelling of business since COVID switched so many companies into digital ones. It also now counts Google, Facebook, Netflix, Airbnb, PayPal, Uber and Amazon amongst its customers.
“Product managers have an outsized role in driving digital transformation and innovation across all sectors,” said Susan Cates, managing partner of Leeds Illuminate. “Having built the largest community of PMs in the world validates Product School’s certification as the industry standard for the market and positions the company at the forefront of upskilling top-notch talent for global organizations.”
Carlos Gonzalez de Villaumbrosia, CEO and founder of Product School, who started the company after moving from Spain, said: “There has never been a better time in history to build digital products and Product School is excited to unlock value for product teams across the globe to help define the future. Our company was founded on the basis that traditional degrees and MBA programs simply don’t equip PMs with the real-world skills they require on the job.”
Product School has also produced the The Product Book, The Proddy Awards and ProductCon.
Its main competitor is MindTheProduct, a community and training platform, which has also boostrapped.
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What Square’s acquisition of Afterpay means for startups
On Sunday Square announced it was gobbling up Afterpay in a deal worth $29 billion at the time of announcement. Alex followed up yesterday with more details on why the deal made sense for Square and Afterpay over here, but we wanted to ask some notable VCs what it means for the startup market.
For context, the Square deal follows a ton of money and interest flowing into the BNPL market. Just this year, VCs have invested in companies like Alma ($59.4 million, January 2021), Scalapay ($48 million, January 2021), Wisetack ($19 million, February 2021), Zilch ($80 million, April 2021) and Dividio ($30 million, June 2021).
Most of the investors we reached out to were generally bullish on the Square and Afterpay integration, but they were less excited about opportunities for other consumer BNPL businesses to emerge.
Then there’s Klarna, which raised $639 million at a post-money valuation of $45.6 billion in June, after raising $1 billion in March at a post-money valuation of $31 billion.
There’s also interest from some major public companies. After a slow start, PayPal is aggressively pushing BNPL services with merchants that offer it as a payment option. And there are reports that Apple is building its own BNPL offering through Apple Pay.
We reached out to Commerce Ventures founder and GP Dan Rosen, Better Tomorrow Ventures founding partner Jake Gibson, Fika Ventures partner TX Zhuo, and Matthew Harris of Bain Capital Ventures to see what they thought of the deal, as well as what it might mean for the opportunity for other BNPL companies and startups.
The main takeaways? “Buy now, pay later” may be effective at driving retail conversion, but scale matters and long-term margins look slim for BNPL startups.
Now, let’s hear from the venture community.
The venture view
Why is the BNPL market so hot?
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Why Square is shelling out $29B to snag BNPL player Afterpay
Shares of Square are up this morning after the company announced its second-quarter earnings and that it will buy Afterpay, an Australian buy now, pay later (BNPL) player in a $29 billion deal. As TechCrunch reported this morning, Afterpay shareholders will receive 0.375 shares of Square in exchange for their existing equity.
Shares of Afterpay are sharply higher after the deal was announced thanks to its implied premium, while shares of Square are up 7% in early-morning trading.
The Exchange explores startups, markets and money.
Read it every morning on Extra Crunch or get The Exchange newsletter every Saturday.
Over the past year, we’ve written extensively about the BNPL market, usually from the perspective of earnings from companies in the space. Afterpay has been a key data source, along with the yet-private Klarna and U.S. public BNPL outfit Affirm. Recall that each company has posted strong growth in recent periods, with the United States arising as a prime competitive market.
Most recently, consumer hardware and services giant Apple is reportedly preparing a move into the BNPL space. Our read at the time was that any such movement by Cupertino would impact mass-market BNPL players more than niche-focused companies. Apple has a fintech base and broad IRL payment acceptance, making it a potentially strong competitor for BNPL services aimed at consumers; BNPL services targeted at particular industries or niches would likely see less competition from Apple.
From that landscape, let’s explore the Square-Afterpay deal. We want to know what Afterpay brings to Square in terms of revenue, growth and reach. We also want to do some math on the price Square is willing to pay for the company — and what that might tell us about the value of BNPL and fintech revenues more broadly. Then we’ll eyeball the numbers and try to decide if Square is overpaying for Afterpay.
What Afterpay brings to Square
As with most major deals these days, Square and Afterpay released an investor presentation detailing their argument in favor of their combination. Let’s dig through it.
Square is a two-part company. It has a large consumer business via Cash App, and it has a large business division that offers payments tech and other fintech services to corporate customers. Recall that Square is also building out banking services for its business customers and that Cash App also serves some banking and investing functionality for consumers.
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PayPal’s new ‘super app,’ to include messaging, is ready to launch
PayPal’s plan to morph itself into a “super app” has been given a go for launch.
According to PayPal CEO Dan Schulman, speaking to investors during this week’s second-quarter earnings call, the initial version of PayPal’s new consumer digital wallet app is now “code complete” and the company is preparing to slowly ramp up. Over the next several months, PayPal expects to be fully ramped up in the U.S., with new payment services, financial services, commerce and shopping tools arriving every quarter.
The company has spoken for some time about its “super app” ambitions — a shift in product direction that would make PayPal a U.S.-based version of something like China’s WeChat or Alipay or India’s Paytm. Like those apps, PayPal aims to offer a host of consumer services under one roof, beyond just mobile payments.
In previous quarters, PayPal said these new features may include things like enhanced direct deposit, check cashing, budgeting tools, bill pay, crypto support, subscription management, and buy now, pay later functionality. It also said it would integrate commerce, thanks to the mobile shopping tools acquired by way of its $4 billion Honey acquisition in 2019.
So far, PayPal has continued to run Honey as a standalone application, website and browser extension, but the super app could incorporate more of its deal-finding functions, price-tracking features and other benefits.
On Wednesday’s earnings call, Schulman revealed the super app would have a few other features as well, including high-yield savings, early access to direct deposit funds and messaging functionality outside of peer-to-peer payments — meaning you could chat with family and friends directly through the app’s user interface.
PayPal hadn’t announced its plans to include a messaging component until now, but the feature makes sense in terms of how people often combine chat and peer-to-peer payments today. For example, someone may want to make a personal request for the funds instead of just sending an automated request through an app. Or, after receiving payment, a user may want to respond with a “thank you,” or other acknowledgment. Currently, these conversations take place outside of the payment app itself on platforms like iMessage. Now, that could change.
“We think that’s going to drive a lot of engagement on the platform,” said Schulman. “You don’t have to leave the platform to message back and forth.”
With the increased user engagement, the company expects to see a bump in average revenue per active account.
Schulman also hinted at “additional crypto capabilities,” which were not detailed. However, PayPal earlier this month increased the crypto purchase limit from $20,000 to $100,000 for eligible PayPal customers in the U.S., with no annual purchase limit. The company also this year made it possible for consumers to check out at millions of online businesses using their cryptocurrencies, by first converting the crypto to cash then settling with the merchant in U.S. dollars.
Though the app’s code is now complete, Schulman said the plan is to continue to iterate on the product experience, noting that the initial version will not be “the be-all and end-all.” Instead, the app will see steady releases and new functionality on a quarterly basis.
However, he did say that early on, the new features would include the high-yield savings, improved bill pay with a better user experience, and more billers and aggregators, as well as early access to direct deposit, budgeting tools and the new two-way messaging feature.
To integrate all the new features into the super app, PayPal will undergo a major overhaul of its user interface.
“Obviously, the [user experience] is being redesigned,” Schulman noted. “We’ve got rewards and shopping. We’ve got a whole giving hub around crowdsourcing, giving to charities. And then, obviously, buy now, pay later will be fully integrated into it. … The last time I counted, it was like 25 new capabilities that we’re going to put into the super app.”
The digital wallet app will also be personalized to the end user, so no two apps are the same. This will be done using both artificial intelligence and machine learning capabilities to “enhance each customer’s experiences and opportunities,” said Schulman.
PayPal delivered an earnings beat in the second quarter with $6.24 billion in revenue, versus the $6.27 billion Wall Street expected, and earnings per share of $1.15, versus the $1.12 expected. Total payment volume from merchant customers also jumped 40% to $311 billion, while analysts had projected $295.2 billion. But the company’s stock slipped due to a lowered outlook for Q3, impacted by eBay’s transition to its own managed payments service.
In addition, PayPal gained 11.4 million net new active accounts in the quarter, to reach 403 million total active accounts.
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WhenThen’s no-code payments platform attracts $6M from European VCs Stride and Cavalry
The payments space — amazingly — remains up for grabs for startups. Yes, dear reader, despite the success of Stripe, there seems to be a new payments startup virtually every other day. It’s a mess out there! The accelerated growth of e-commerce due to the pandemic means payments are now a booming space. And here comes another one, with a twist.
WhenThen has built a no-code payment operations platform that, they claim, streamlines the payment processes “of merchants of any kind”. It says its platform can autonomously orchestrate, monitor, improve and manage all customer payments and payments ops.
The startup’s opportunity has arisen because service providers across different verticals increasingly want to get into open banking and provide their own payment solutions and financial services.
Founded six months ago, WhenThen has now raised $6 million, backed by European VCs Stride and Cavalry.
The founders, Kirk Donohoe, Eamon Doyle and Dave Brown, are three former Mastercard Payment veterans.
Based out of Dublin, CEO Donohoe told me: “We see traditional businesses embracing e-comm, and e-comm merchants now operating multiple business models such as trade supply, marketplace, subscription, and more. There is no platform that makes it easy for such businesses to create and operate multiple payment flows to support multiple business models in one place — that’s where we step in.”
He added: “WhenThen is helping e-commerce digital platforms build advanced payment flows and payment automation, in minutes as opposed to months. When you start to integrate different payment methods, different payment gateways, how you want the payment to move from collection through to payout gets very, very complex. I’ve been doing this for over a decade now, as an entrepreneur building different businesses that had to accept, collect and pay payments.”
He said his founding team “had to build very complex payment flows for large merchants, airlines, hotels, issuers, and we just found it was ridiculous that you have to continue to do the same thing over and over again. So we decided to come up with WhenThen as a better way to be able to help you build those flows in minutes.”
Claude Ritter, managing partner at Cavalry, said: “Basic payment orchestration platforms have been around for some time, focusing mostly on maximizing payment acceptance by optimizing routing. WhenThen provides the first end-to-end payment flow platform to equip businesses with the opportunity to control every stage of the payment flow from payment intent to payout.”
WhenThen supports a wide range of popular payment providers such as Stripe, Braintree, Adyen, Authorize.net, Checkout.com, etc., and a variety of alternative and locally preferred payment methods such as Klarna Affirm, PayPal and BitPay.
“For brave merchants considering global reach and operating multiple business models concurrently, I believe choosing the right payment ops platform will become as important as choosing the right e-commerce platform. Building your entire e-comm experience tightly coupled to a single payment processor is a hard correction to make down the line — you need a payment flow platform like WhenThen”, added Fred Destin, founder of Stride.VC.
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