Buy now pay later provider DivideBuy has secured a 拢300 million lending facility as it continues its stellar growth trajectory.聽
The Newcastle-under-Lyme business, a rival to Klarna, is on track to hit 拢175m gross merchandise value this year.
The funding from global investment management firm Davidson Kempner Capital Management LP, which includes a minority equity investment, will be used by the FinTech to hire executives, invest in its platform and boost its retailer network in the UK and internationally.
Founded in 2014, the firm鈥檚 tech is now used by more than 500 retailers, including Cloud Nine and Simba Sleep.
It recently announced a partnership with recommerce experts musicMagpie, creating a new rental platform for the listed retail giant.聽
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鈥淒ivideBuy has one goal – to make buy now pay later transactions easy and accessible to retailers and customers,鈥� said founder and CEO Rob Flowers.聽
鈥淭he sheer scale of this investment underlines the strength of DivideBuy鈥檚 business model, and how we鈥檙e revolutionising the POS (point of sale) finance sector by owning the full lending journey with assistive technology, automated soft credit checks and transparent lending with no hidden fees.
鈥淭he flexibility of our technology treats each customer as an individual, and also gives retailers revenue-boosting strengths such as higher checkout conversions and higher basket sizes.聽
鈥淲ith this backing from Davidson Kempner, we can now make buy now pay later transactions available to even more retailers, and extend the alternate payment method to many more consumers who want greater payment choice at the POS.聽
鈥淲e鈥檙e thrilled to embark on the next stage of our expansion and achieve our ambitious growth plans.鈥�
Two years ago DivideBuy secured over 拢60m of equity investment and debt financing from Souter Investments and Jon Moulton鈥檚 private investment vehicle.
Unlike other POS finance solution providers, DivideBuy offers both the technology platform and the credit facility to the retailer. By cutting out traditional credit suppliers, DivideBuy says it enables retailers to lower their credit risk and accelerate customer onboarding with market-leading application approval rates.
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After switching from competitors, DivideBuy says retailers experience vastly improved conversion rates, increased basket value, reduced basket abandonment and typically see an increase of up to 70% on approvals and conversions, which helps to foster customer loyalty.
Unlike other POS finance providers which offer instalment terms up to three months, DivideBuy enables customers to have instalment terms of up to 12 months, which helps consumers purchase larger-value items with affordable, interest free instalments, and helps retailers raise average basket values.聽聽
Flowers added: 鈥淭he partnerships we鈥檝e secured with leading businesses like musicMagpie demonstrates how much our solution resonates with consumers looking for more flexible and affordable ways to pay.
鈥淲ith the backing of Davidson Kempner, we have set ourselves the ambitious task of growing exponentially within the interest free market, while being true to our original aim of creating greater value for retailers everywhere and enhancing the entire buying, or indeed, renting, experience for customers by creating intuitive, user-driven platforms.鈥�