Lee Fixel’s Addition leads $32M investment into TruePay, a Brazilian B2B ‘buy now, pay later’ startup

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Global investors continue to be attracted to LatAm.

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troupe, the one-year-old So Paulo-based “buy now, pay later” startup announced today that it has raised $32 million in a Series A funding round led by the addition of Lee Fixel.

This investment is leading a Series A in Latin America for the first time. This comes just three months after Kaszek and Monashee co-led an $8.5 million seed round that also includes participation from ONEVC and Global Founders Capital.

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TruePay’s mission is to build a B2B “Buy Now, Pay Later” network where sellers (industries) can give credit without being exposed to default risk and where buyers (merchants) can seamlessly purchase inventory from their suppliers. Use credit promptly and without cost.

Founded by former VCs Pedro Oliveira and Luis Eduardo Casco, TruPay says it has clients in all states of Brazil, with a merchant base that is “in the thousands” after just five months of operation. Growth, its founders say, has fluctuated from 100% month-on-month to 200% in 2021. The company expects to grow between “ten to fifteen times” in 2022.

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In December 2020, Oliveira and Casco left their jobs as venture capitalists at Kaszek and DNA Capital, respectively, to start a fintech company. TruPay differs from other BNPL offerings in that it aims to convert a retailer’s credit card receivables (also known as merchant cash advances) into purchasing power. By using such receipts as collateral, the company claims it can guarantee payment to the supplier. By removing the default risk barriers, TruPay aims to streamline commercial relationships between merchants and their suppliers.

By using TruPay, CEO Oliveira said, retailers have access to better payment terms with their suppliers, which allow them to make larger purchases with more time to pay and ultimately free up working capital for their operations. allows.

“Suppliers are no longer exposed to the default risk of merchants and are therefore able to offer more loans and thus increase sales,” he told Nerdshala.

The money will largely go towards further recruitment. Currently, the company has 50 employees and aims to expand to 100 by the end of the year.

“The strength of TruPay’s solution lies in the convergence of a real and untapped need among retailers to unlock credit and free up working capital, a large addressable market, and a talented team,” Fixel said in a statement. “We look forward to supporting the company as it continues to develop its innovative, convenient and low-cost payment technology.”

As we have been told in the past, many startups in Latin America are building technology not only for innovation but also to promote financial inclusion in the region.

Retailers in Brazil are victims of a scenario where average receiving terms are long, while average payment terms are short – creating a huge working capital gap, according to Casco.

“These companies carry the economy of the country on their shoulders, but there is no source of capital at minimum reasonable cost to bridge this gap,” he said. “Therefore, they resort to other solutions such as factoring receivables at high rates with payment processing companies and soliciting credit from banks at outrageous interest rates. The suppliers of these retailers, in turn, often go between selling them or not giving them credit. have to choose, to run the risk of default, which they are usually unable to do – resulting in a negative credit cycle. TruePay was created to break this negative spiral and turn the relationship into a flywheel Was. “

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