Sezzle, a local financial-technology startup that makes it easier for consumers to pay for online purchases in installments, has closed on $5.6 million in capital and is planning to debut on the Australian Securities Exchange.
Sezzle has raised $5.6 million in a planned $6 million round from 10 investors, according to an SEC filing. The round was led by Chicago-based Continental Investors, a fin-tech fund founded by former Morgan Stanley CEO Philip Purcell.
This is the third major funding for Sezzle within the last year. Last April, the Minneapolis-based company closed on more than $8 million to revamp its business model. In November, Sezzle secured $100 million from Stamford, Conn.-based investment firm Bastion, which provides debt capital to finance companies.
More than 500,000 users have signed up for Sezzle's service since it launched 18 months ago, the company recently told Minne Inno.
Sezzle expects to raise between $20 million and $30 million through the IPO. The company chose to file on Australia's ASX because of the presence of Melbourne-based Afterpay, its biggest competitor. Afterpay's success has been driven by investors who understand the potential of the payment method, something U.S. investors have yet to accept, Sezzle CEO Charlie Youakim told the Biz Journal.
The company was also attracted by Australia's looser regulations that make filing easier for early-stage companies. There are also fewer tech companies in which to invest in Australia, Youakim said.
Sezzle won't be the first Twin Cities company to file on the ASX. Osprey Medical, a Minnetonka-based medical-device company, raised $20 million in 2012 through an IPO on the ASX.
The Minneapolis startup currently has no plans to operate in Australia, the Australian Financial Review reports, but did not rule out expanding there in the future.
