Checkout.com raises $1B round at $40B valuation

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Payments company Checkout.com isn’t just a unicorn — it has closed a $1 billion Series D funding round. Following today’s round, the company is now valued at $40 billion.

That’s a stark increase compared to last year’s valuation. With its Series C round, the company raised $450 million at a $15 billion valuation — it represents a 167% valuation jump in 12 months, which is not too bad.

Checkout.com is building a full-stack payments company — it acts as a gateway, an acquirer, a risk engine and a payment processor. The company lets you process payments directly on your site or in your app, but you can also rely on hosted payment pages, create payment links, etc.

It supports card payments, Apple Pay, Google Pay, PayPal, Alipay, bank transfers, SEPA direct debits and even cash payments through various local networks.

Last year, the company also added the ability to issue payouts. Checkout.com customers can send money to a bank account. It also supports payouts to a card on the Mastercard or Visa network. For instance, TikTok and MoneyGram have been using Checkout.com’s payouts feature.

Unlike Stripe, Checkout.com focuses specifically on large global enterprise merchants with a high volume of transactions. Some of the company’s clients include Netflix, Farfetch, Grab, NetEase, Pizza Hut and Shein. The company also contributes to the payments stack of several fintech unicorns such as Klarna, Qonto, Revolut and WorldRemit.

When it comes to today’s funding round, fasten your seatbelt, as the list of investors is quite long. Investors who participated in the round include Altimeter, Dragoneer, Franklin Templeton, GIC, Insight Partners, the Qatar Investment Authority, Tiger Global, the Oxford Endowment Fund and “another large west coast mutual fund management firm,” the company writes in its announcement.

Some of the company’s existing investors are also participating, such as Blossom Capital, Coatue Management, DST Global, Endeavor Catalyst and Ribbit Capital.

Why did Checkout.com raise so much money? Because they can. The company says it has been profitable for several years, which means that investors are just adding money to the balance sheet for long-term growth. Checkout.com only had to hand out 2.5% of the company’s shares in exchange for $1 billion.

“By combining an elegant technology stack with industry expertise and an ‘extra-mile’ approach to service over the past decade, we’ve built deep partnerships with some of the world’s most innovative companies,” founder and CEO Guillaume Pousaz said in a statement. “Our Series D is validation of that work—but given we’re still in ‘chapter zero’ of our journey, it will also fuel our efforts to unlock the enormous untapped opportunity ahead.”

The company processed hundreds of billions of dollars in payments in 2021 alone. It has tripled its transaction volume for the third year in a row and it now has 1,700 employees across 19 countries.

Up next, Checkout.com wants to focus specifically on the U.S. market. With its headquarter in London, the company originally focused on the EMEA region. And yet, as it tries to work with global enterprise merchants, having a solution that works across all markets could be a big selling point for future clients.

“Much like our approach in EMEA, we will maintain our focus on the enterprise — especially fintech, software, food delivery, travel, e-commerce and crypto merchants. We’re looking to help our U.S. customers grow domestically and internationally, and to help our non-US customers expand into the market here,” Checkout.com’s CFO Céline Dufétel said in a statement.

The web3 opportunity

With today’s funding round, Checkout.com will most certainly hire more people and sign new clients. But the company doesn’t plan to stand still, as it wants to launch new products.

The ability to issue payouts has created new opportunities. In particular, Checkout.com plans to support marketplaces and payment facilitators later this year. It’ll be a full end-to-end solution with identity verification and the ability to split payments so that marketplace operators can keep a cut on each transaction.

Marketplace customers will also be able to hold funds directly on a marketplace thanks to a new treasury-as-a-service feature. It opens up a ton of possibility as marketplaces can embed financial services directly in their products.

Stripe announced Stripe Treasury last year. Shopify has been using the feature for Shopify Balance. It proves once again that both Stripe and Checkout.com want to cover a bigger chunk of the payment chain.

In addition to new products, Checkout.com has realized that web3 represents a market opportunity. The company already powers some of the payments features of several cryptocurrency companies, such as Coinbase, Crypto.com, FTX, MoonPay and Novi from Meta.

But creating bridges between fiat currencies and cryptocurrencies is just one part of the web3 equation. Checkout.com is also beta-testing a solution that could let its customers settle transactions for merchants using digital currencies. In other words, the Checkout.com of web3 could very well be Checkout.com.

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