Wayflyer Raises $76M for E-commerce Financing

Wayflyer Secures $76 Million in Series A Funding

Wayflyer, a revenue-based financing platform dedicated to supporting e-commerce businesses, has successfully completed a $76 million Series A funding round. The investment was spearheaded by Left Lane Capital.

Investment Details and Previous Funding

The funding round also saw participation from partners at DST Global, QED Investors, Speedinvest, and Zinal Growth – the family office associated with Guillaume Pousaz, founder of Checkout.com.

This new capital arrives shortly after Wayflyer secured $100 million in debt financing to bolster its cash advance offerings. The company launched its initial product just 14 months ago, in Dublin, Ireland.

Addressing Growth in the E-commerce Sector

The surge in e-commerce, accelerated by the COVID-19 pandemic, has spurred investment in related startups. Wayflyer aims to empower e-commerce merchants by providing access to vital working capital.

This funding, ranging from $10,000 to $20 million, is designed to enhance cash flow and stimulate sales. Increased capital allows merchants to purchase inventory in larger quantities, leading to cost savings and improved fulfillment of customer orders.

How Wayflyer's Revenue-Based Financing Works

Wayflyer leverages data analytics to provide merchants with cash for inventory purchases or business investments. Repayment is structured as a percentage of the merchant’s revenue, plus a fee for the advance.

This revenue-based financing model offers flexibility; repayments adjust with sales fluctuations, unlike the fixed schedules of traditional bank loans. If a merchant experiences a slower month, their repayment amount is reduced accordingly.

A Data-Driven Competitive Advantage

Aidan Corbett, co-founder of Wayflyer, asserts that the company’s sophisticated use of big data provides a significant advantage in a competitive market.

Wayflyer originated from Conjura, a marketing analytics firm also founded by Corbett. Jack Pierse, a former venture capitalist, proposed repurposing the analytics engine for underwriting e-commerce businesses for short-term financing in September 2019.

Rapid Growth and Expansion

The platform was launched in April 2020, initially facilitating $600,000 in advances. By March 2021, that figure had grown to approximately $36 million.

Over the last six months, Wayflyer has experienced a 290% growth rate, deploying over $150 million in funding across ten markets. The United States accounts for roughly 75% of its customer base.

Future Plans and Market Focus

The newly acquired capital will be allocated to product development and global expansion. Wayflyer intends to enter “multiple” new markets in the coming months.

The company has recently established a sales office in Atlanta, complementing existing locations in the U.K., the Netherlands, and Spain.

Differentiating from "Buy Now, Pay Later" Models

Corbett highlights that Wayflyer’s approach, focused on directly funding merchants and offering supplementary services, is more advantageous than consumer-focused “buy now, pay later” solutions.

By obtaining data directly from merchants, Wayflyer can provide additional services beyond financing. Conversely, “buy now, pay later” services primarily rely on consumer data, limiting opportunities for value-added services.

Value-Added Services for Merchants

Wayflyer offers a free analytics platform to any business that signs up, even if they are not approved for or do not accept an advance. This platform helps merchants optimize their marketing expenditures.

The company also connects merchants with marketing analytics and inventory specialists to refine their performance and negotiate better supplier terms.

Flexible Repayment Terms and Funding Approach

Wayflyer distinguishes itself through flexible repayment terms, tied to sales performance. The company generates revenue by charging a principal on advances, alongside a “remittance rate” on revenues until full repayment.

Unlike some competitors, Wayflyer provides cash directly to merchants’ accounts, rather than paying invoices on their behalf or issuing pre-charged cards.

Strategic Partnership with Adobe Commerce

A recent agreement with Adobe Commerce is expected to significantly expand Wayflyer’s reach, with a goal of funding 8,000 e-commerce businesses within the first year of the partnership.

Investor Confidence and Future Outlook

Dan Ahrens, Partner at Left Lane Capital, expressed his firm’s confidence in Wayflyer’s “nuanced understanding of what will drive value for their clients.”

He further emphasized the team’s specialization, analytical expertise, and superior underwriting capabilities, noting that the company’s rapid growth has been achieved without excessive risk. Ahrens believes Wayflyer’s underwriting will improve with scale, strengthening its competitive advantages.

A Competitive Landscape

The revenue-based financing space is becoming increasingly crowded. Settle, for example, recently raised $15 million in a Series A round led by Kleiner Perkins to provide non-dilutive capital to e-commerce and consumer packaged goods (CPG) companies.