The hits just keep on coming for European fintech startups.
A little-known London payments provider has secured Europe's largest-ever fintech Series A, propelling its valuation to almost $2 billion—not bad for a first fundraising attempt. Just seven years after inception, Checkout.com raised $230 million in a round led by Insight Partners and DST Global, with participation from investors including Singaporean sovereign wealth fund GIC, Blossom Capital and Endeavor Catalyst. As part of the deal, Insight Partners managing partner Deven Parekh will join the company's board.
With the capital injection, the startup is ramping up its global expansion efforts in Asia and Latin America, as well as maintaining its growth in Europe, the US and the Middle East. Checkout also has plans to triple its team—currently at around 350 employees—over the next three years and move into new product areas.
Despite its low profile, it comes as no surprise that investors have taken note of the business. Checkout offers cross-border payment services to a roster of clients including Samsung, Transferwise and Deliveroo. Additionally, in a somewhat rare feat for a startup, the company is actually profitable. Checkout generated revenues of $46.8 million in 2017, a 56% increase from the previous year, and recorded a 61% growth in profits to nearly $30 million. What is more of a surprise is that there is no record of the business having ever raised money before receiving the $230 million.
And if its competitors are anything to go by, the business seems like a safe bet. Dutch payments company Adyen has seen its share price go through the roof since listing on Amsterdam's Euronext last year, rising by around 70%. The company, which was valued at $1.5 billion in 2014, now boasts a valuation of around $22 billion. Before its IPO, Adyen received massive amounts of cash from investors, including $250 million five years ago (although not in its Series A).
Checkout's investment is the latest feather in the cap for the European fintech industry, which has been buzzing with activity in 2019. The year kicked off with N26's record $300 million round, which was broken a month later by lender OakNorth, which raised an eye-watering $440 million from SoftBank and Clermont in the continent's biggest-ever fintech VC deal. Other noteworthy funding rounds from 2019 include a 120 million Swiss franc (around €105 million) investment in Swiss insurer Tradeplus24 and Berlin-based Raisin’s $114 million Series D.
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