SumUp, the UK digital payments startup, secured a $371 million loan to bankroll its expansion. The loan is backed by Bain Capital Credit and Goldman Sachs Private Capital.
The six-year-old startup makes credit card readers that connect with any mobile or tablet device via bluetooth, accepts payments from all major debit and credit cards and can process more than 500 transactions on one charge. Aiming to bring more transparency to the payment processing market, SumUp charges 2.65% per transaction. Customers aren’t required to sign a contract and don’t have to guarantee a level of volume.
With the funding, SumUp is looking to grow its customer count across the thirty-one markets it is already in. Expansion could come partly through acquisitions. SumUp pointed to its recent acquisitions of accounting startup debitoor and Shoplo, the invoicing fintech focused on eCommerce and marketplaces, as examples of its M&A focus. Proceeds will also be used for product development in-house.
“We believe in affordable, simple and reliable technology that empowers small businesses all over the world to be successful doing what they love,” said Marc-Alexander Christ, co-founder of SumUp in a press release announcing the funding. “This cash injection will significantly accelerate the growth of our customer base, enhance SumUp’s technology leadership position and drive the development of new services.”
SumUp is emerging as a formidable player in the payments revolution. With fintech companies trying to make it easier and faster for businesses of all sizes to make and receive payments, businesses are responding. One need only look at SumUp’s year-over-year growth. Revenue is up more than 120%. It counts more than 1.5 million businesses across the globe as customers and expects to generate more than €200m in revenue this year.
At the same time that SumUp is growing on its own and securing capital, it is also inking deals with major financial companies to expand its base. Just this week it announced a partnership with Mastercard that will increase the number of electronic payment acceptance locations in 27 European countries. Over the course of five years, the two plan to bring card acceptance to millions of micro, small and medium-sized businesses in Europe. The companies will be able to accept electronic payments with SumUp’s card readers by credit card, smartphones, and smartwatches. The idea is to arm small businesses with the tools they need to serve customers who expect choice, convenience and the ability to pay via smartphone. Cash is still dominating in Europe but with a shift underway, SumUp is making sure smaller enterprises aren’t left behind.
“There is a card acceptance gap that exists due to smaller businesses historically not being well-served by traditional payment providers. 10% of any population should be able to accept card payments but only around 1% does. It's this gap that SumUp and Mastercard are looking to fill through the partnership, “ said Marcel Schneider, CCO & EVP Europe at SumUp in a statement announcing the deal.