Financial service company Splitit has raised $10.5 million just over a month after moving its global headquarters to Atlanta.
About the raise: The raise came from several new institutional investors along with current investors, according to the company. Some of its existing investors include Goldman Sachs Bank USA and Woodson Capital Management, according to business intelligence site Crunchbase. The raise also included $712,500 from the company’s management team and board of directors. The raise brings the company’s total funding to around $100 million since its founding, said CEO Nandan Sheth.
Looking forward: Funds will be used for hiring, investing in its product and expanding the business globally. The company looks to attain enterprise customers that are 10 times the size of its average customer, Sheth said. Its primary customers are businesses in the e-commerce space including dental company Byte. The company has approximately 1,000 merchant customers and aims to add around 250, Sheth said. Splitit has 60 U.S. employees and plans to hire another 40. About 60% will be based in Atlanta, Sheth said.
About the company: Founded in Israel in 2009, the company is part of the “buy now, pay later” industry. It partners with businesses to allow consumers to make substantial purchases in monthly installments rather than paying full price at once. In 2019, the company raised $8.6 million through its initial public offering, which valued the company at $38.7 million,businesses include Stockholm-based Klarna, Australia-based Afterpay and San-Francisco-based Affirm.
Growth after regulation: This month, the U.S. Consumer Financial Protection Bureau said it plans to regulate "buy now, pay later" lenders in the same fashion as traditional credit card companies, citing consumer privacy concerns for short-term financingaccording to CNBC. Sheth says the new regulation will make their growth outpace competition because Splitit verifies that a consumer has enough credit.
Relocation: The raise comes just over a month after the company relocated its global headquarters from New York City to Atlanta. The company also has offices in Melbourne, Australia and London, England. Its Atlanta office is located in Sandy Springs at the Palisades Office Park. It also has a research and development center in Israel.
Why it matters: Splitit’s relocation to Atlanta adds to the city’s burgeoning group of financial companies that gives it the moniker "Transaction Alley." Startups in the local financial technology ecosystem have a history of scaling rapidly, sometimes achieving a $1 billion valuation. In 2020, Greenlight Financial Technology reached unicorn status after launching its first debt card in 2017. Georgia has over 200 financial technology businesses that generate $72 billion in annual revenue.
About the founders and CEO: In January of this year, Splitit appointed Sheth as its CEO. The company was founded by Alon Feit and Gil Don. Prior to joining Splitit, Sheth co-founded Atlanta businesses including electronic invoicing company Harbor Payments, which was acquired by American Express in 2006, and online payments Acculynk, which was sold to First Data in 2017.
