Sixth Street Growth and Bain Capital Tech Opportunities led the investment round for British payments startup SumUp, which raised 285 million euros ($306.6 million).
Hermione McKee, Chief Financial Officer of SumUp, stated that the company now has “more firepower to act on opportunities” due to the additional funding, which includes acquisitions and new country launches.
SumUp verified that the company’s valuation has increased from when it raised 590 million euros ($635.3 million) in summer 2022, when it was valued at 8 billion euros ($8.6 billion).
Known for its tiny card readers, British payments startup SumUp revealed on Monday that it has raised 285 million euros ($306.6 million) in a massive funding round, valuing the business at over $8.6 billion.
The investment in SumUp was spearheaded by Sixth Street Growth, the expansion division of the international investment firm Sixth Street. Other participants in the most recent round of funding for SumUp included debt financing company Liquidity Group, fintech investment firm Fin Capital, and current investor Bain Capital Tech Opportunities. Although some money was raised in the form of debt, equity made up the majority of the funding round.
The new funding provides SumUp “more firepower to act on opportunities that we see arising over the course of the next two years,” according to Hermione McKee, Chief Financial Officer.
“If we consider our geographic expansion, we entered Australia as our 36th market worldwide in August,” McKee said in a previous week’s interview with CNBC, prior to the announcement.
We can still expand further in Latin America, where we already have a presence. Next, we consider how we view Asia, and finally, there are obviously opportunities throughout Africa. Globally, there are countless opportunities. We evaluate this “buy versus build” approach on a continuous basis.
SumUp was last valued at 8 billion euros ($8.6 billion) in a 2022 funding round that saw the company raise a staggering 590 million euros of capital for growth and global expansion. With this round, the company says it “continues to build further” on the valuation it achieved. According to a SumUp representative, the transaction is an up round, which indicates that its valuation has increased.
Given the state of European technology valuations, which have suffered greatly in the last year as investors have fled the sector due to rising interest rates and macroeconomic headwinds, that is no small accomplishment.
PitchBook, a venture data firm, reports that median valuations decreased in the third quarter of 2022 across all stages, with growth-stage valuations showing the least resilience and late-stage valuations the most.
Previous owners of SumUp sold their shares at a significant discount to the company’s most recent official valuation earlier this year. In a filing with the U.S. Securities and Exchange Commission, one online coupon site, Groupon, revealed that it was selling off shares in SumUp at a price that would only value the business at 3.9 billion euros ($4.2 billion).
According to McKee, SumUp does not currently have any plans to go public because it can easily obtain funding from the private markets.
“I believe this round has demonstrated that we do, in fact, have access to private pools of capital, negating the need for an IPO,” the speaker stated.
We actually make sure that we are operating at a standard and quality that is appropriate for public markets, so we’re always trying to improve our processes. However, this is not something that we are actively preparing for right now or something that is approaching quickly.
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