Laybuy Raises GBP 80M Debt Funding, Moves Toward ASX Listing

The pre-IPO raise will be used to bolster Laybuy’s expansion efforts in the U.K.

Australasia-based ‘Buy Now, Pay Later’ (BNPL) company Laybuy has secured funding to the tune of GBP 80 ****million (US$103.65 million at current rates) as debt from Chicago-headquartered alternative investment firm Victory Park Capital (VPC), the company announced in a statement today.

Laybuy is a BNPL fintech product that provides shoppers with micro-credit for both in-store and online purchases, repayable without interest over six weeks. The funding will beef up Laybuy’s U.K. expansion, the statement said.

“In addition to increasing our customer base in our established geographies and sectors, our expansion in the UK is a critical component of our growth strategy and VPC’s backing will enable us to strengthen our position in the market,” Laybuy CEO and Co-founder Gary Rohloff said in the statement.

According to reports, Laybuy is headed for an initial public offering (IPO) soon, with its fresh debt funding intended as a second pre-IPO round. The raise reportedly puts Laybuy’s valuation at $199 million.

Plans to list on the Australian Stock Exchange were stalled due to the COVID-19 pandemic, reports suggest, but the BNPL company is back on track with its listing plans, reportedly bookbuilding ahead of the upcoming IPO.

Rohloff noted in the statement that Laybuy had “grown exponentially since [it] launched three years ago”. Laybuy was founded in 2017 in New Zealand, and has 4500 retail merchant partners in the country, the statement said.

Following an expansion to Australia in 2018, Laybuy expanded operations in the U.K. through a partnership with streetwear brand retailer Foot Asylum in 2019.

The BNPL company noted in the statement that the Laybuy platform had seen a surge of around 50% in the number of merchants on the platform, and over twice that rate of increase for active customers, which grew by around 110%.

Laybuy had over 5600 merchant partners and 470,000 active customers as of the year ending 30 June, 2020, the statement said.

“Buy now, pay later services have seen incredible rates of adoption globally. With the accelerated adoption of digital commerce, Laybuy is well-positioned to capture future growth opportunities,” Partner at VPC Jason Brown said in the statement.

BNPL is a largely millennial trend aimed at facilitating convenience or affordability when shopping. Both the Oceania region and the U.K. have big players in the BNPL segment, with Afterpay in Australia and Klarna in the U.K.

BNPL companies can work on very different models, however. Companies like Simpl or Afterpay, for instance, simply work as payment aggregators where users can settle bills within a timeframe without interest.

Others, such as Klarna or Laybuy, are more credit-leaning BNPL companies that can have an impact on customers’ credit scores.

Header image by jcomp on Freepik

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