Edison Partners led $96 million in new growth financing for digital payment company Prepaid Technologies, the companies announced Nov. 2.
Prepaid Technologies will use the proceeds of the round to accelerate its market expansion and continue to advance its technology payments platform and customer-focused prepaid solutions.
Global investment firm StepStone Group co-led and Stifel Venture Bank participated.
Approximately $120 trillion in business payments are still check-based, and service providers are fragmented across multiple vendors to execute payroll, rewards, purchasing and disbursement, the company claims. Together, the four represent $80 billion addressable markets, growing at more than 10% annually and accelerating with the proliferation of smartphones, e-commerce and digitized payments since the pandemic’s onset.
Prepaid Technologies allows customers to access and customize B2B and B2C payments across these segments through its fintech platform.
“Prepaid Technologies is making it easy for businesses to transform their outdated disbursement, payroll, and purchasing processes with real-time digital payments across niche categories where competitors don’t have the same level of depth or expertise,” said Edison Partners partner Jennifer Lee.
Lee
“This is a unique product offering, where a company can access and customize different payment solutions in a one-stop shop. We’re impressed with Stephen Faust and the management team’s ability to remain capital-efficient while growing organically and profitably. We look forward to working with them as they execute on their vision,” she said. “Modern payroll and expense management for remote workforces continues to see strong traction through the last 18 months. B2B payments are also trending higher as companies opt for disbursement solutions that make it easier and safer to deliver corporate funds. These tailwinds bode particularly well for the company’s growth and provide a moat for adjunct product opportunities.”
Prepaid Technologies has seen more than 15,000% straight-line growth in its load value and revenue has increased 142% annually over five years, since the company raised $5 million in 2016 through Ballast Point Ventures in its sole round of outside capital.
In time, the company’s customer base has grown to 1,700 customers. It has 450 active partners including banks; payroll processors; payment providers, such as FIS; fintechs, such as digital banking platform MoneyLion, another Edison Partners investment; enterprise technology companies; marketing, health and wellness payments processors; and merchant services providers.
Prepaid Technologies also enjoys strong retention metrics with notable blue-chip customers like Lowes, Taco Bell, Nissan and Sony.
“We purpose-built our platform to create a turnkey way for companies to configure payments solutions across their enterprise however they operate. Clients access payments through our dashboard technology or integrate solutions into their workflows through our robust API suite,” said Prepaid Technologies CEO Stephen Faust. “We’re laser-focused on productization and customization that will help to transition more companies to card-based and digital solutions. With this investment, and with Edison Partners’ expertise and experience, we can focus on investing in our current solutions, accelerating our industry footprint and expanding our suite of offerings to ensure our customers and partners achieve their goals.”
Edison Partners has led investments for more than 50 fintech companies, and within its current portfolio are Bipsync, ComplySci, Fund That Flip, GAN Integrity, Giant Oak, GoHenry, Houwzer, MoneyLion, Nuula, Yieldstreet, and Zelis.
LendIt Fintech recognized the company as Fintech Equity Investor of the Year.
This marks Edison Partner’s first investment in Alabama and its third growth financing in an underserved market this year, following investments in Boulder, Colo.-based The Pros Closet and Houston-based MacroFab.
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November 02, 2021 at 07:39PM
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