Dublin-based startup Wayflyer raised USD 76 million in a Series A funding round, as announced on May 27, 2021. This raise comes just after the company raised USD 100 million in debt funding to help its cash advance product, and 14 months after it launched its first product.
The funding round was led by Left Lane Capital. Other participants of the round were “Partners” of DST Global, QED Investors, Speedinvest, and Zinal Growth which is the family office of Guillaume Pousaz, who is a founder of Checkout.com.
The startup plans to use the funding for product development and global expansion with the aim of entering “multiple” new markets in the further months.
Founded in 2019 by Aidan Corbett and Jack Pierse, Wayflyer is a revenue-based financing platform for eCommerce brands. It aims to support e-commerce merchants’ “unlock growth” by giving them access to the working capital which is from USD 10000 to up to USD 20 million in order to help them improve cash flow and increase sales like by buying more inventory in bulk in order to meet customer demand and save money. It uses analytics and helps merchants with cash to make inventory purchases or investments in the business. The merchants then repay Wayflyer using a percentage of their revenue until the money is paid back and a fee is charged for the advance given. The merchants are basically using their revenue to get financing. The benefit to the merchants here is that they pay back a percentage of their sales, which means if a particular month they have fewer sales, they will pay back less. This method offers flexibility to the merchants which a bank loan is unable to.
In the beginning, when it started it gave around USD 600000 advances and by March 2021, it had given USD 36 million in advances. Over the past six months, the company has grown at 290% as it used over USD 150 million of funds across 10 markets focusing on the US, United Kingdom, and Australia and 75% of its customers are from the US. The company has its offices in the UK, the Netherlands, and Spain and has recently opened its office in Atlanta.
The company has recently come into an agreement with Adobe Commerce, which would provide it a new channel to increase its growth and has the aim of funding 8000 e-commerce businesses in the first year of its partnership.
What does the CEO say?
“There’s a lot more opportunity for companies like ourselves to differentiate because essentially, we focus on the merchants. And when we underwrite the merchant by getting data from the merchant, there’s a lot of additional services that you can put in on top. Whereas with buy now, pay later, you get information on the consumer, and there’s not as much room to add additional services on top.”
“For example, if a business requests an advance and either is not approved for one or doesn’t choose to take it, Wayflyer’s analytics platform is free to anybody who signs up to help them optimize their marketing spend.”
“This is a critical driver of value for e-commerce businesses. If you can’t acquire customers at a reasonable price, you’re not going to be around very long. And a lot of early-stage e-commerce businesses struggle with that. Our focus from the very beginning is really supporting the merchants, not just providing them with working capital”.
What do the investors say?
Left Lane Capital Partner, Dan Ahrens, said that his firm was impressed by Wayflyer’s “nuanced understanding of what will drive value for their clients.
“The team’s focus, specialization, and deep analytical expertise within the e-commerce market also drive superior underwriting. Their explosive growth has not come about by taking on undue risk. We are big believers that their underwriting will only improve with scale, and that Wayflyer will be able to compound its competitive advantages over time.”
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