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UK’s Paddle, world’s first Apple IAP competitor scoops $200M at unicorn valuation of $1.4B

Paddle's CEO Christian Owens
Image credits: Paddle

Paddle, the London-based provider of a complete payments infrastructure for SaaS companies, has today announced closing its Series D, netting $200M in equity & debt financing at a $1.4B valuation.

The investment which adds Paddle to the list of unicorns was led by KKR with participation from existing investors FTV Capital, Notion Capital, 83North and Kindred Capital. Debt financing came from Silicon Valley Bank and brought Paddle’s total raised funds to date to $293M.

Paddle’s payments infrastructure and how its different

SaaS companies now have the incredible opportunity to compete and sell their products in any market across the globe. In order to achieve this, they must also manage payments and operations across multiple geographies while navigating an increasingly complex web of local and international tax and data regulations.

Paddle is offering SaaS companies a completely different approach to their payment infrastructure. As opposed to assembling and maintaining a complex stack of payments-related apps and services, the platform acts as a merchant of record for its customers. This means that Paddle takes away the full pain of payments fragmentation, implying a faster, safer, cheaper and better-than-most option.

By integrating checkout, payment, invoicing, subscription management, international taxes and financial compliance processes Paddle is enabling sellers to activate new business models, entering new markets faster, with more ease & with fewer operational and compliance issues.

KKR’s Director, Patrick Devine testified to the company’s effective solution sighting that, “Paddle is solving a significant pain point for thousands of SaaS companies by reducing the friction and costs associated with managing payments infrastructure and tax compliance. By simplifying the payments stack, Paddle enables faster, more sustainable growth for SaaS businesses. Christian and the team have done a phenomenal job building a category-defining business in this space, and we are excited to be supporting them as they embark on the next phase of growth.”

What the funding will do

Paddle will utilise its funding to strengthen the growth of its platform and further meet the market opportunity that exists for a complete payment infrastructure provider for SaaS companies globally. SaaS companies are experiencing a period of rapid & sustained growth; a trend owed to the digital transformation during the Covid-19 pandemic. This trend is set to continue as businesses and consumers become ever more accustomed to using digital tools and Paddle hopes to tap into this growing space.

“The opportunity in software is enormous, with tens of thousands of incredibly innovative businesses bringing great products to market every year. Unfortunately, many SaaS companies still find their growth hindered by the operational challenges that arise when scaling; from handling subscriptions management or tax compliance to localizing payment options in every market. Paddle was created to remove these invisible barriers so that SaaS companies can just focus on building and selling software. 2021 was a fantastic year for us, but we are only just getting started. We have big plans for 2022 and beyond and we’re delighted to have the backing of so many fantastic investors who all share our vision.” remarked Paddle’s co-Founder & CEO Christian Owens.

About Paddle

The company was founded in 2012 by Christian Owens and Harrison Rose with the aim of defining the next wave of B2B SaaS leaders by empowering companies to transform their revenue infrastructure into a strategic growth lever to respond faster and more precisely to each & every growth opportunity.

The newly crowned unicorn’s complete payments infrastructure is used by over 3,000 software companies in more than 200 markets globally. Paddle last year launched an In-App Purchasing (IAP) system for iOS developers which is a true like-for-like, drop-in replacement for Apple’s IAP, allowing developers to maintain a smooth user experience, without having to pay Apple 30% for every sale. Paddle’s fee structure is highly competitive, charging 10% for transactions under $10 and 5% on transactions over $10 meaning that developers earn more from every purchase.

Rapidly expanding internationally has led to Paddle more than doubling its revenue growth since late 2020, contributing to an impressive average annual revenue growth of over 175% over the last four years. Its team has also scaled from 140 to 275 across offices in London and New York, with more hires expected to match its business acceleration.

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