Buy now, pay later services – which finance the purchase of goods online by paying consumers a total in installments over time – has been ubiquitous over the past year. today, Scalpe, One of the companies that is building a platform to buy now, Pay Later (BNPL) and related features, to enhance its position in the customer race against competitors such as Karlna, Afterpay and Affirm Has raised a round for
The Milan, Italy-based startup has raised $ 48 million in funding, funds that it will use to continue building the technology in its platform, expanding its service in Europe and working on efforts to dent the US Will do.
The round was led by Fasanara Capital and also included Balen Capital and the Italian Family Office of Ithaca Investments. It is the startup’s first significant funding since its launch in 2019.
Scale’s service revolves around a basic model that involves a quick sign-up, and then an agreement to repay the entire amount in three equal installments, debited to your bank account or credit card.
Like others such as Affirm, Scalapay does not charge consumers interest or other fees: its business model is based around taking commissions from merchants on every transaction, arguing that offering an easy and quick BNPL service will allow conversions and shopping carts to Size will increase.
The startup currently has around 1,000 merchants using its service in Europe, France, Italy and Germany, including well-known, European European retailers such as Decathlon, Calzonia, Bata, Esom and Bricobravo. It claims to be the largest provider of BNPL services in its country.
It recently partnered with the banking “marketplace” Raisin Bank, And through that, Scalpe will soon be able to offer its merchant customers the ability to offer BNPL services in any European country.
CEO and co-founder Simone Mankini said the plan would be to add more core countries, as well as related payment facilities in areas such as customer acquisition, conversion, retention and back office functions associated with withdrawal and completion and ordering.
For a start, on their site, Scalpay lists merchants that offer their BNPL service, and the startup has found that these links generate an average of 1 million referrals each month. Mancini said that the company is working on how to build a product around the concept as part of its expansion.
There was a time when it was not common for sites to find installment-based payment options, a carryover from the brick and mortar world with the BNPL where people paid for items using latent or other-in-store finance options in the past Especially for more expensive items like TV.
But traction like old online services Privately held (Currently worth more than $ 10 billion), as well as Afterpay in the US and Australia (both of which are publicly traded), such as the recently entered Scalap (which was founded in 2019) and others Has paved the way for new players Alma.
They have all been removed from the circumstances we are living in at the moment.
The use of e-commerce has seen a huge increase as people stay away from physical stores (even when those stores are open) to help in social distancing. But at the same time, many consumers are in less financially stable positions as a result of the epidemic, so options to help them pull out payments and remain more flexible with their money have increased in appeal.
It also means that the average price of goods that people buy on installments is also changing. Mancini said the average amount people are paying on Scalapay is currently around € 100. This underlines the value that people are not prepared to pay up front, so from a microeconomic point of view it will be interesting to see how this figure rises or falls in the future.
The fact that the amounts are not particularly high right now, meanwhile, may be one reason why scalp have seen some strong numbers in terms of omissions and endorsements. Mancini said the “first purchase approval rate” is currently about 93% higher or lower depending on the category. And its default rate is below 1.5%.
These are not bad, but also no different from their rivals.
Going forward, there are major challenges for a company like Scalpe, therefore, building solid algorithms to ensure that it is not normal for people to just be financing those who are likely to default on payments , Ensuring that its system remains fraud-free, and soon. These would also include finding a way to differentiate themselves from the rest of the pack of companies providing the same basic services.
There is probably a small detail, but it is notable to me that Scalpe’s site is not unlike Curlna’s. Both also overshadowed pink as a color theme.
It is also worth noting that Mancini from Australia (where his co-founder Johnny Mitrevski still lives and runs R&D) to start Schaenpe, as Australia said, is very difficult to break because of Afterpay’s dominance Was happening
“Australia is one of the most competitive markets, versus Italy being one of the most underdeveloped markets,” he said. “It was an easy pick for BNPL with a heap of opportunity.” The company’s focus on manufacturing more than the basic BNPL should also help build a profile and diversify the business.
“In a statement, Fasanara Capital CEO, Francesco Filia said,” I was impressed by the company’s rapid growth and underlying model. “He has shown resilience during difficult periods and I am excited about where the company is.”
“Scalape’s platform delights customers, delivering dramatic results for merchants,” Fang Li, managing partner of Balen Capital, said in a statement. “As a long-time investor in the BNPL industry, I have been impressed by Scalpay’s team, execution and product. I believe the company is well on its way to becoming a valuable and leading partner for European retailers. “