It is no secret that e-commerce has rapidly exploded over the past 25 years. Not only that, macroeconomic changes, such as COVID-19 and subsequent social distancing, have only accelerated its preeminence. Putting things into perspective: Online retail sales have surpassed the $3.5 trillion threshold and are projected to reach over $6.5 trillion by 2023.
Going online is not an option anymore, but a necessity! This stands true for both large retailers as well as for mom and pop shops. Actually, over 90% of the over 3 million online shops in the world (excluding China) are SMEs. But one question remains.
Good question. Let’s have a quick look at the financing options available to e-commerce businesses today:
Enter Wayflyer, the revenue-based financing option for e-commerce brands. By using innovative data sources via API integrations with payment providers (Adyen, Stripe, etc.) and ad metrics (FB, Adwords, etc.), Wayflyer is able to merge performance marketing with financial performance to provide capital. The analytics are free of charge and are continuously adjusted in order to help e-commerce shops improve their return on advertising spend (ROAS). Businesses with financing needs are able to finance up to USD 2M on their marketing spending.
Revenue-based financing unites the best features of equity and debt financing into one. Revenue-based lenders understand that ROAS is predictable for many e-commerce companies. Many brands know that if they spend €1 on Adwords, then they expect to generate €3 in revenue. Revenue-based lenders provide funding for predictable marketing spend and then use the revenues generated by that marketing spend to repay the funding. Below is a comparison of the different financing options that make the revenue-based option a no-brainer:
For e-commerce companies, this is an extraordinarily compelling value proposition: no interest, no dilution, no warrants, no fixed repayment schedule, no covenants and no long-term commitment. This all translates to an easy process with fast applications and payout.
For online shops the financing is frictionless. Think of Wayflyer as a partner who helps them grow more quickly by improving their ROAS and advancing their marketing spend when it is needed.
Aligning interests with customers is crucial in any business, especially if all parties want to create a healthy and long-lasting business relationship. This is why Wayflyer is not solely focused on offering revenue-based financing, which oftentimes results in a short-term relationship.
Wayflyer is focused on creating a fundamentally new product category that goes beyond just financing. With Wayflyer’s free analytics tools, Wayflyer provides e-commerce businesses with personalized data that can help them (i) improve their marketing spendings, (ii) create a relationship of trust with customers, and (iii) get the client to a critical size to enable them to be approved for a loan.
Behind all of this sits a diverse, energetic and united team led by repeat founders Aidan Corbett (CEO) and Jack Pierse (CFO). Corbett and Pierse complement each other perfectly and have attracted high-caliber talent from all over the world. It is precisely this mission-driven team, sustainable embedded model, and long-lasting relationships with a growing customer segment that got us excited about this opportunity.
After this seed round, Wayflyer will continue to execute on their global ambitions. This means growing the team with senior sales and AE specialists, as well as product and credit experts. As they continue to expand into key e-commerce geographies, we at Speedinvest only grow more excited to join Wayflyer in this venture with QED Investors and MiddleGame Ventures. Upwards and onwards!
Read More at the Irish Times.
Authored by Enrique Martinez Hausmann, a member of the Speedinvest Fintech team. Traditional institutions have long been the sole gatekeepers of the financial sector. Now, Fintech companies are uprooting business models across insurance, investing, lending, real estate and banking, easing access to financial services we use every day. From wefox to Bitpanda, Luko, Curve and Tide, the Fintech team has a portfolio spanning from Europe to emerging markets and partner with the most innovative tech startups driving this disruption. Whether reinventing payments or embedded finance, our sector expertise, strong industry networks, and in-house operational support helps founders unleash their full potential.
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