Overview
A US-based digital payments business operating in the instalment payments sector. Regal participated in the company’s pre-IPO funding round in 2019.
Key Investment Details
- Sector: Financial Technology
- Geography: United States
- Investment Vintage: 2019 (pre-IPO)
- Customer Base: Approximately 4.6 million active customers at the time of transaction
Context
Regal identified the emerging growth potential of instalment-based consumer payment solutions in Australia and formed the view that similar products could gain traction in the United States. Through direct engagement with the company’s founders, Regal was able to access a private investment opportunity.
Investment Opportunity
The investment thesis focused on supporting an emerging participant in a rapidly evolving consumer finance category which was in the early stages of adoption in the US market.
Key considerations included:
- Early market exposure: Participation in a developing segment of consumer finance with increasing customer adoption
- Merchant partnerships: Relationships with recognised merchants supporting customer acquisition and transaction growth
- Product capability: Mobile application and customer experience features that differentiated the business within a competitive market
- Market opportunity: Exposure to a large addressable consumer credit market with long-term growth potential
Outcome
- Strategic transaction: A subsequent strategic investment occurred at a premium to Regal’s original investment price
- Continued operational growth: The business continued to scale as customer adoption increased
- Corporate transaction: The company was ultimately acquired in an all-share transaction in 2020
- Portfolio management: Regal actively assessed market conditions and portfolio positioning throughout the investment lifecycle
Conclusion
This investment demonstrates Regal’s thematic research capability, industry relationships and ability to access differentiated growth opportunities through private market transactions.
This information is prepared by Regal Partners Marketing Services Pty Ltd (ACN 637 448 072), a corporate authorised representative of Regal Partners (RE) Limited (ACN 083 644 731, AFSL 230222). All investments contain risks. Past performance is not a reliable indicator of future performance. You should read the Information Memorandum (including the key risks) applicable for the relevant Fund, and consider obtaining professional investment advice tailored to your specific circumstances, before making any investment decision. Any investment in a Fund will be solely on the basis of its Information Memorandum (as updated and amended from time to time).
