Minneapolis E-Commerce Startup Sezzle Raising $6M Ahead of Possible IPO Move
E-commerce payment platform Sezzle Inc. is raising $6 million in a funding round, ahead of rumored plans to list on the Australian Securities Exchange (ASX). The Minneapolis startup has raised $5.6 million so far, following an initial sale on March 29, according to a U.S. Securities and Exchange Commission (SEC) filing.
The filing notes 10 investors have contributed so far, with a minimum investment established of $37,500. Chicago-based institutional investor Continental Investors is leading the round, as reported by the Australian Financial Review (AFR).
The AFR referred to the round as a “pre-IPO” campaign and reported that Sezzle will list on ASX within the next few months. The company already has representatives traveling Australia meeting with local investments, wrote the AFR.
The decision to list on ASX, despite Sezzle not actually operating in Australia, was made because “investors [in Australia] really understand the model, they get it—well ahead of US investors,” Sezzle co-founder and CRO Paul Paradis told the AFR.
The listing plans and preceding $6 million fundraising effort come just months after Sezzle raised $100 million in debt financing, largely from Connecticut-based investment firm Bastion Capital. That capital was to go toward growing Sezzle’s retail payment business, including boosting its volume with existing and new merchant partners.
The retail space is Sezzle’s specialty, in both the consumer and retailer areas. The company was initially founded with a focus on helping young adults with credit issues by providing interest-free installment plans for online purchases. The model of splitting purchases more manageably therein increases a user’s purchasing power—benefiting retailers as much as customers.
Since launching its latest payment solution for consumers about two years ago, more than 4,000 merchants and 200,000 shoppers have signed up for the service. Sezzle’s underlying monthly sales reached $9.6 million in February.
In a statement in November about Sezzle’s $100 million funding round, Bastion Capital managing partner Jay Braden said Bastian was inspired to invest because Sezzle’s services and products quality had not seemed to decrease amid rapid growth.
“What impressed us most is Sezzle’s execution and sense of purpose,” said Braden.
Sezzle’s leadership could not be reached for further comment on the $6 million round and listing plans by press time.