GoCardless raises $95m, nears unicorn status with $970m valuation

By Sunniva Kolostyak

London-based FinTech GoCardless has announced a Series F funding round of $95 million led by BainCapital Ventures – bringing its valuation above $970 million.

GoCardless, which is very close to reaching unicorn status, has seen a 46 per cent year-on-year growth despite a challenging economic environment, and the latest round brings the total raised to $240 million.

The funding will be invested in its Open Banking strategy to provide consumers and businesses with access to better services by allowing merchants to access recurring payments through instant and transparent open banking payments at a lower cost than cards.

The strategy involves providing an end-to-end recurring payment solution for its merchants with instant first payments and recurring collection via bank debit; expanding into the adjacent e-commerce market; enabling businesses to collect international payments; and providing businesses with a complete open banking payment processing service, including features such as refunds, payment reconciliation and error handling.

Hiroki Takeuchi, CEO and co-founder of GoCardless, said: “This funding round demonstrates the strength of the business and the confidence both our customers and investors have in GoCardless. We’re incredibly proud to have seen continued business growth in such challenging times, and to have been able to continue supporting our customers – helping them stay in control of their payments and cash flow.”

“We believe that open banking is set to disrupt the payment landscape by introducing new, simpler and more secure ways of making bank-to-bank payments that will compete with the traditional card networks. Our investment in open banking innovation will create a uniquely valuable payment offering – continuing to provide our customers with the best way to collect recurring payments.”

GoCardless offers recurring payments, such as Direct Debit in the UK, to multinational corporations like Docusign to fast-growing SaaS businesses like 8×8, and the rising subscription economy including Brompton Bike Hire and Bridgestone’s MOBOX. It processes over $18 billion of payments annually across more than 30 countries.

In 2020, it has had a 100 per cent increase in new bookings and expanded its technology offering with Success+, a payments intelligence tool powered by machine learning, to help businesses optimise their retry strategy when payments fail.

Matt Harris, Partner at investor Bain Capital Ventures, also commented: “We’re excited by GoCardless’ enormous growth potential in a massive and largely untapped market. In particular, we’re seeing strong early results as GoCardless moves beyond SMBs to serve mid-market and enterprise customers and expands its international footprint to address a growing need for bank debit processing. We have enormous confidence in Hiroki and the entire GoCardless team to build a multi-billion dollar company that will redefine the payments industry.”