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B2B BNPL Mondu raises $43M, plans to expand into Austria in 2022

Mondu founders
Image credits: Mondu

Buy Now Pay Later (BNPL) has emerged as one of the leading financial products in recent times. Unlike traditional credit products, BNPL has gained momentum among consumers by offering smaller amounts. While most players in the segment are limited to B2C users, B2B BNPL is quickly rising with compelling financial offerings for SMEs. Though B2B BNPL already existed, it is growing immensely with digitisation.

Mondu, a Berlin-based fintech company that wants to be a part of the B2B BNPL revolution has just announced that it has raised $43 million in a Series A round led by US-based venture capital fund Valar Ventures co-founded by Peter Theil (that invested in Taxfix and Shares).

In addition, existing investors Cherry Ventures, FinTech Collective, and tech entrepreneurs and senior executives from Klarna, Zalando, and SumUp have also joined the round. With this, the total funding raised by Mondu to date is $57 million.

Austrian expansion in 2022

Mondu will use the proceeds of this round to scale its BNPL for B2B solution for merchants and marketplaces by investing in its product and customer acquisition. The company also plans to expand into more European countries later this year, starting with Austria this summer.

Commenting on the expansion plans this year in an exclusive questionnaire, the company Co-CEOs and Co-Founders Philipp Povel and Malte Huffman said, ”Mondu is taking the international expansion one step at a time. With the expansion to Austria, German merchants can also activate the Mondu payment method for their customers in Austria. Furthermore, Mondu’s solution will then be available for Austrian merchants, who can offer their customers a broader mix of payment methods in B2B by integrating their payment method.”

Besides this, it is hiring for a wide range of senior and junior positions across the company, including its tech, risk, sales, and operations teams.

They added, “With its approx. 100 Monduneers the company feels its team is extremely strong in all important areas. It will continue to hire aggressively going forward. Mondu is remote-first, but its team will be located mainly in Germany.”

How did Mondu evolve?

The fintech startup Mondu is active in the B2B payments space and provides a BNPL solution for B2B merchants and marketplaces. It recognises a $200 billion market opportunity for B2B BNPL in Europe and the US, which is larger than the existing global consumer BNPL market.

The purpose of the company is to simplify the financial lives of SMBs so that they can focus on their business. Its BNPL solution for merchants and marketplaces offers the favourite payment methods in B2B, as well as flexible payment terms in their online checkout.

Mondo was founded by serial entrepreneurs Philipp Povel, Malte Huffmann and Gil Danziger in August 2021 in Berlin and raised a $14m seed round in October 2021. Povel and Huffmann co-founded a Latin American e-commerce platform Dafiti, together in Brazil and went public through Global Fashion Group (GFG:GR) in 2019. The two moved back to Germany and were joined by Gil Dazinger, as Co-Founder and CTO, to create Mondu. It is focused on creating a highly attractive product, growing its merchant customer base and the number of businesses it serves and scaling its team.

Earlier this year, Mondu appointed former Klarna Legal Director Miyu Lee as its Chief Legal Officer and General Counsel to build a dynamic and modern legal and compliance team to match its ambitions.

What does Mondo do?

Mondu has built a consumerised payment product to drive conversion rate and incremental sales for merchants, focussing on a frictionless checkout experience for business customers. The solution easily integrates with merchants and is accessible through APIs, plug-ins, and checkout widgets.

The company has developed best-in-class risk management capabilities for high approval rates at checkout, with a low-risk cost for Mondu. With high approval rates being a key metric for merchants, Mondu is able to provide rates of over 90%.

Replying on how it works, they said, “Mondu integrates into the B2B checkout via API or widget. When the customer chooses Mondu as a payment method at checkout, a widget will turn up. Mondu will be able to authenticate all types of business buyers, identifying them by company name and address. The business customer will then choose between settlement options Invoice and Direct Debit. Mondu’s risk-scoring algorithms run in the background and the credit approval decision is taken within 0.2 seconds. Once the business buyer finalises the purchase, the merchant sends confirmation, ships the products or service and sends the invoice to the customer. Mondu will pay the merchant upfront and collect the payment directly from the business customers. Through its customisable solution, merchants and marketplaces can define their exact requirements with regard to payment methods and net terms offered to their customers.”

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