Sezzle Sold to Australian Competitor for $356M
Sezzle founder Charlie Youakim

Sezzle Sold to Australian Competitor for $356M

Australia-based Zip Co. Ltd. has reached a deal to buy Sezzle. The combined company plans to retain "a significant footprint in Minneapolis."

It’s official: Minneapolis-based fintech firm Sezzle Inc. is merging with rival Australian payment platform Zip Co. Ltd.

On Monday, the companies announced that Zip will purchase Sezzle for roughly $356 million. The companies telegraphed the move a month ago, when Sezzle confirmed that it was in merger talks with Zip.

Though it’s based in Minneapolis, Sezzle has been publicly traded in Australia since 2019. Zip is also traded on the Australian Stock Exchange. Both companies operate a “buy now, pay later” platform that enables users to make purchases and then divide payments up over time. The process doesn’t involve credit.

For now, Sezzle and Zip will continue to “operate their products separately,” according to regulatory filings. The combined company plans to keep its Minneapolis operations intact, too: “Zip intends on retaining a significant footprint in Minneapolis, Minnesota, where Sezzle is headquartered in the U.S.,” according to a filing with the Australian Stock Exchange.

Until now, Sezzle and Zip catered to vastly different merchants. Customers can use Zip to make purchases at retail behemoths like Amazon, Walmart, Macy’s, and others. But Sezzle has targeted smaller, niche businesses, such as clothing line Akira and Jessica Simpson’s fashion line. Zip leaders were drawn to Sezzle’s “strength in small- and medium-sized businesses,” according to filings.

The purchase may help Zip get a foothold in the United States. In a filing, the two companies said that the deal “significantly enhances Zip’s scale and product offering, with the capabilities to accelerate in the U.S.”

In 2021, Sezzle co-founder and CEO Charlie Youakim received an award through Ernst & Young’s ongoing “Entrepreneur of the Year” program. The prior year, Youakim landed on TCB‘s “Tech 20” list.

Youakim has also been a guest on TCB‘s “By All Means” podcast.