Discover the achievements of Mangopay, CarPay-Diem, and 3S Money in payments and fundraising. From buyouts to strategic partnerships, these companies have forged their own paths to success in the industry.
Mangopay
Activity: Modular payment infrastructure dedicated to marketplaces and crowdfunding platforms.
Year of establishment in Luxembourg: Launched in 2013 as a spinoff of Leetchi
Total funding raised: €9m from Seed to Series B (as Leetchi). Acquired in 2022 by Advent International who injected a further €75m.
Funding Mix: VC: Kima Ventures and 360 Partners (2013); Crédit Mutuel Arkéa joined the funding round in 2015); PE: acquired by Advent International (2022).
“Funds or no funds. If you want to succeed you need a performance based culture. That’s a good way to accelerate thing.”
Roamin Mazeries, CEO of Mangopay
Collaborative payments solution Mangopay has a diverse funding journey which last year saw it fully bought-out by PE firm Advent International.
Based in Luxembourg since its inception, its equity journey began while it was part of Leetchi, which raised some €9m through growth VCs at Seed, Series A and Series B.
When it began fundraising for Series C for €20m, Mangopay received an offer from Crédit Mutuel Arkéa, a financial service provider that provides banking services. “In 2015, we decided to accept the offer. And after almost four years, we became part of Crédit Mutuel Arkéa,” recalls Mangopay CEO Romain Mazeries. By 2019, the group owned 100% of the company. When the bank made strategic changes, the two decided to find a new shareholder to accelerate Mangopay’s growth and go international. In 2022, it finalised an operation in which private equity firm Advent International bought out Mangopay.
“For me it was one of my best choices because they have an amazing track record in the payments industry,” says Mazeries, adding: “And they are very well known worldwide in the industry for being experts in payments.”
Advent International injected a further €75 million of private capital into the company and together they formulated a three-year value creation plan setting out everything from product capabilities, to the technical evolution of its tech stack and consolidation of its position in the EU market and beyond. Thanks to the injection, the scale-up is on track to expand into the US in early 2024.
Since the acquisition, the firm’s team has more than doubled from fewer than 200 to over 400 FTEs.
The buyout also enabled strategic acquisitions of its own: of Whenthen in March 2023 for €45m and Nethone in November 2022. “Both of them were product buy but also team buy because it was very difficult to find their expertise on the market,” says Mazeries, adding “We gained 30 engineers who are experts in payments and from Nethone we gained data experts.”
The exercise required a year of internal preparation, changing the way it tracked performance and standardising processes in order to be ready to scale. “It’s part of the evolution of the company. Funds or no funds. If you want to succeed you need a performance based culture. That’s a good way to accelerate things,” says Mazeries.
His parting advice to other CEOs or founders looking to take the buyout path is to prepare themselves for the pace of acceleration and build strong foundations. Also surrounding themselves with the right people to support growth. He says: “For example, if you need to hire a new CFO, for example, don’t hire a CFO for the company you are today, but hire one for the company you will be in the next few years.”
CarPay-Diem
Activity: Mobile fueling and digital marketing platform, allowing any mobile app or connected vehicle to activate any fuel pump or charging pole independently of the brand.
Year of establishment: 2016.
Total funding raised: Undisclosed.
Funding Mix: Industrial investors Eden Red and ZF Group & non-dilutive funding from Luxinnovation.
“It was a win-win situation: we had access to IT resources without having to cash out for the development and they became shareholders of an innovative company after the successful delivery of the MVP”
CarPay-Diem CEO Frédéric Stiernon
Like many startups, family, friends and business angels provided the initial finance to get mobile fuelling and digital marketing app CarPay-Diem on the road. It was enough for the founding team to pay minimum wages for eighteen months. To convince an external IT company to build the MVP and commercially engage with early prospects, the founding team offered shares in exchange for services to the IT companies that build the MVP.
“It was a win-win situation: we had access to IT resources without having to cash out for the development and they became shareholders of an innovative company after the successful delivery of the MVP,” explains CarPay-Diem CEO Frédéric Stiernon.
With a viable prototype in hand along with a growth forecast and go to market, in 2019 the startup wowed national innovation agency Luxinnovation, securing non-dilutive funding to grow. It also increased its capital from initial investors, raising enough to commercialise its solution and build an in-house IT development team to develop further and to operate the mobile fuelling platform.”
“Once you go abroad you want to standardise your product, you’d rather have people in house so we needed that funding to hire our development staff,” recalled Stiernon.
They still needed serious dry powder capital to industrialise, distribute and prospect and a conscious decision was taken not to follow the VC route.
“VC mainly comes with money but not always the right contacts in the ecosystem you evolve in. Strategic corporate partners have both money and contacts with the actors of your ecosystem. They are active in the same market so can help our company to move forward based on its evolution. Their value for a company like CarPay-Diem is more important than the money they brought,” says Stiernon. The founding team preferred to find investors who might have a “natural interest in investing into the solution”: a corporate partner.
In the summer of 2020, CarPay-Diem finalised the agreement with its first corporate investor, Edenred, a digital platform offering payment solutions for food, incentives, mobility and corporate payments. It was the startup’s biggest cash injection to date and helped the team take a breath, increase the sales team and drive expansion in Europe beyond the Benelux markets.
It followed this in December 2022 with a Series A funding round through industrial investor ZF Group.
While the synergies between the scale-up and its investors are mutually beneficial, the industrial investor path is not without challenges. CarPay-Diem dedicated a full-time team member to contacting and pitching to potential industrial investors.
“The downside of looking for corporate investors is it’s more work and search intensive,” says Stiernon, adding that the pitch must also be more tailored to the target.
The result is a “much tighter bond” with the investor, compared to working with VC. “It’s definitely a longer route but it goes both ways,” says Stiernon, adding: “Our corporate investors have decided to use our solution so this helps our development on the market but, like any other investor they also look for a financial return at the end.”
Stiernon’s parting advice to other startups looking to take the industrial investor route: “Keep a close eye on your financial indicators, start early, and walk the extra mile. It’s worth it!”
3S Money
Activity: Cross border payments platform.
Year of establishment in Luxembourg: (2018 in London) 2020.
Total funding raised: Undisclosed.
Funding Mix: Bootstrapped, VC. Plans to launch an IPO in the next 2 years.
“The sector is evolving indeed, only companies with a differentiated offer and successful business model will be the ones getting funding”
Coralie Billmann, COO for 3S Money Europe
Traditional banks don’t make it easy for SMEs to open accounts. The founders of 3S Money discovered this when they wanted to open an account for a different company in the Netherlands. Not to be deterred, they developed their own cross-border payments platform which became their main activity.
Founded in London in 2018, today 3S Money simplifies and reduces the cost for businesses making payments between subsidiaries in different countries with operations made from a single account.
“3S Money is a cross-border payments platform for international business: which allows clients to send, receive and exchange payments in more than 190 countries and territories in over 65 currencies,” says Coralie Billmann, one of the firm’s two conducting officers and COO for the 3S Money Europe.
Bootstrapped and with some VC, the digital payments platform received a strong boost during the covid-19 pandemic. Its revenue soared 400% in 2021 and today the company supports client payments of up to $300m each month. 3S Money is currently preparing for a potential initial public offering on the London Stock Exchange within the next two years.
3S Money has also reached profitability, a positive situation to be in considering the current economic environment; according to CBInsights global fintech funding fell 46% YOY in 2022 and deal numbers declined 8%. Experts forecast a year of VC funding consolidation for the sector in 2023, but Billmann was optimistic. “The sector is evolving indeed, only companies with a differentiated offer and successful business model will be the ones getting funding,” she says.
Today 3S Money has over 150 people located at its London head office, and five local offices: in Luxembourg, Dubai, Singapore, Riga and Amsterdam.
This article was first published in the Silicon Luxembourg magazine. Get your copy.
