GoCardless raise $126m, led by Bain Capital Ventures

GoCardless, a fintech leader in recurring payments supporting more than 55,000 businesses worldwide, announced that it has raised AUD$126 million (USD$95 million) in a Series F funding round.

This latest fundraise, led by Bain Capital Ventures, follows 46 per cent year-on-year growth for GoCardless despite the challenging economic environment and supports its ambitious growth plans. It brings the total raised to-date to AUD$318 million (USD$240 million).

GoCardless will use the funding to accelerate its open banking strategy, combining the latest technology with its global bank debit network. For the first time, merchants will be able to access the best of both worlds for recurring payments: Instant open banking payments will provide visibility and speed, while bank debit maximises cash flow and minimises churn by pulling funds automatically from payers – all at a lower cost than cards.

GoCardless will also expand its offering into the adjacent e-commerce market to launch a simple and secure way of making bank-to-bank payments as a lower-cost alternative to cards.

GoCardless takes the pain out of getting paid for businesses of all sizes – from multinational corporations like Xero to fast-growing SaaS businesses like Deputy, and the rising subscription economy including Zuora. The company processes AUD$24 billion  (USD$18 billion+) of payments annually across more than 30 countries. In 2020, it showed resilience throughout the pandemic with strong performance and an increase in new bookings of 100 per cent. In addition, GoCardless expanded its technology offering with Success+, a payments intelligence tool powered by machine learning, to help businesses optimise their retry strategy when payments fail.

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.”

Matt Harris, partner at Bain Capital Ventures, said, “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.”

GoCardless’ investment in its open banking strategy aims to:

• Provide an end-to-end recurring payment solution for its merchants: first-time payments via bank debit can take on average two to three days to process, prompting merchants to use alternative methods such as cards for the first payment. Instant first payments will offer a lower-cost alternative to cards, before the recurring collection continues via bank debit
• Expand into the adjacent e-commerce market: develop a unique bank-to-bank payment method for e-commerce payments made to merchants that customers use on a regular basis. This will provide an alternative to cards that will significantly lower transactions costs for merchants
• Enable businesses to collect international payments: provide businesses of all sizes with global access to Open Banking / the New Payments Platform (NPP) and its equivalents around the world, all delivered into their existing bank accounts in local currency
• Provide businesses with a complete open banking payment processing service, including features such as refunds, payment reconciliation and error handling.

Open Banking, and its equivalents around the world, are designed to open up banking data to provide consumers and businesses with access to better services that can save them time and money.