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Fintech Scalapay raises $497 million and becomes Italy’s first unicorn

The round involved China’s Tencent, which had already backed Scalapay’s French rival Alma, as well as Afterpay and Berlin-based Billie. New York-based Willoughby Capital, which had already invested in Bolt, was also a co-investor in the B round. Previous investors Tiger Global and Fasanara also participated in the round, along with new investors Gangwal, Moore Capital and Deimos.

Deferred payment market problems

– Despite the decline in BNPL (buy now pay later) valuation in the public markets, our investors were quite optimistic. We managed to weather the period,” CEO and co-founder Simone Mancini told Sifted.

Scalapay began fundraising in November and signed a term sheet in early December. This was just as BNPL’s Australian-listed shares began a steep 96% decline. Since then, companies like Laybuy and OpenPay are still down more than 90% from their 2020 peaks.

Mancin doesn’t see a competitive threat despite the difficult situation because in Europe, there are only one or two players who can execute BNPL for larger brands. The company is working with slightly higher order values (up to €1,500) than BNPL competitors.

Scalapay’s plans

The fresh cash will allow the company to double its workforce, mainly in the technical and engineering department in Italy, as well as fund potential acquisitions.

– There are other companies in our sector doing payments or other BNPL services, so if it makes sense to acquire them to expand our reach, accelerate our operations and introduce a new product, we will definitely do it, Mancini added.

Scalapay doesn’t want to follow in the footsteps of Klarna and Afterpay by building banking infrastructure for consumers. Instead, it plans to focus on creating more cashout products for merchants.

It took its first step in that direction in October with the launch of Magic Checkout, which provides an infrastructure for small and medium-sized businesses to help speed up transactions. It is currently being used by 100 merchants.

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