Company card unicorn Payhawk plans acquisitions to develop in US

AMSTERDAM, Netherlands — Company funds startup Payhawk informed CNBC it’s planning mergers and acquisitions to develop its footprint within the U.S. and tackle massive gamers within the area like SAP and venture-backed corporations Brex and Ramp.

The startup stated it’s trying to purchase a U.S. firm or firms on the sequence A stage of their improvement, referring to early-stage startups which have already raised a big spherical of funding.

In an interview with CNBC, Hristo Borisov, Payhawk’s CEO and co-founder, stated he thinks his agency has a greater “product-market match” than its rivals, which have gained multibillion-dollar valuations by handing out free company playing cards to different startups.

“We see a possibility to have a lot better unit economics on this enterprise,” Borisov informed CNBC on the Cash 20/20 convention in Amsterdam, Netherlands, this week. “We imagine firms like Brex and Ramp nonetheless have not discovered sturdy product market match for what this potential market goes to be.”

Payhawk is a company spend administration platform that points good playing cards for purchasers’ workers to make funds and maintain monitor of their bills. Decathlon and Vinted are amongst its clients.

Within the U.S., Payhawk has partnered with American Categorical underneath the bank card large’s Sync Business Associate Program. This permits it to situation digital playing cards which earn rewards based mostly on consumer spending.

Payhawk recorded big development within the first quarter, the corporate informed CNBC. It revealed that income climbed 84% globally year-over-year, and gross sales jumped 127% within the U.Okay. — a market that now makes up 27% of total income.

Payhawk’s development got here off the again of a big improve in purchasers. The agency stated it noticed a 58% improve in clients year-over-year within the three months ending March, with the U.Okay., once more, a serious driver.

Now, Payhawk desires to develop its U.S. footprint in an enormous means — and M&A can be a key to unlocking that development, in line with Borisov.

“Many companies that received funded in final two or three years at the moment are ready the place they’re taking a look at strategic choices,” Borisov stated. “That is one thing we’re actively doing. We’re on the lookout for firms to purchase.”

“Our imaginative and prescient is to have the ability to present a single platform that gives a homogeneous surroundings your company expense wants with a single supplier,” Borisov stated. “There’s going to be some market consolidation.”

Requested whether or not his agency was trying to elevate new enterprise funding to realize its targets, Borisov stated that Payhawk is at all times in fundraising conversations.

He added that its renewed development over the previous yr had garnered curiosity from exterior buyers, after a harder 2022 and early 2023.

“Fundraising is on a regular basis,” he stated. “It is not as a result of we’d like cash. The worst time to fundraise is once you want the cash.”

“We’re chatting with buyers each day, understanding the place the market is,” Borisov added. “Companions who do imagine in that imaginative and prescient see the identical means.”

Payhawk could look to lift a brand new enterprise spherical both this yr or subsequent yr, Borisov added. The agency, backed by enterprise corporations Lightspeed, Greenoaks, and Earlybird, has raised $240 million up to now.

He stated his final aim is for Payhawk to change into a publicly listed firm, although there isn’t any date but for the agency to launch a public market debut.

“Our final aim is to IPO the corporate, that is one thing we’re targeted on,” Borisov stated. “This actually relies upon in the marketplace situations and market realities.”