London-based payments startup SumUp acquires fintech startup Fivestars for $317M to take expand into the US and take on PayPal and Square
SumUp, a London, England-based fintech startup and global payments service provider, has acquired San Francisco-based startup Fivestars for $317 million in a bid to expand its footprint in the U.S. and take on giants like PayPal and Square. The announcement comes six months after SumUp raised $895M in funding from Goldman Sachs and other high-profile investors.
Headquartered in San Francisco, Fivestars was founded eleven years ago by Matt Doka and Victor Ho to help merchants set up rewards schemes and promotions for customers. Through its integrated payments and marketing solutions platform, Fivestars provides an app to run loyalty programs and shopping analytics for small brick-and-mortar retailers.
Founded in 2011 by Daniel Klein, Jan Deepen, Marc-Alexander Christ, Petter Made, and Stefan Jeschonnek, SumUp allows businesses of all sizes to receive payments quickly and simply, both in-store and online. It was recently named as Europe’s fastest-growing company in the ‘Inc. 5000.’
SumUp is best known for its mobile credit card readers which let small businesses accept payments. The startup currently supports over 3 million merchants globally including across Europe, the U.S., and Latin America. Its card terminals and online services are used by businesses from DHL to black cab drivers – SumUp is the go-to partner for small businesses from every walk of life. In October 2018, SumUp released its 3G reader, a card terminal that lets merchants process payments without the need for a mobile app or constant Wi-Fi connection.
With the acquisition of Fivestars, SumUp is betting big on future growth coming from the U.S. market looking to compete with PayPal-owned processor iZettle as well as Jack Dorsey’s Square.
SumUp is also the only company to offer an end-to-end EMV card acceptance solution built on proprietary hardware and mobile apps. This unique offering enabled SumUp to rapidly expand into 16 markets, including the U.S., Brazil, and Germany, making it the mPOS company with the largest global footprint.
The company has recently broadened its product portfolio in the POS and gastronomy space across the UK and continental Europe through the acquisition of leading POS software providers Goodwill and Tiller. These recent acquisitions will put SumUp into contact with potentially millions of new customers, from cafes and restaurants right up to the biggest sports stadiums and concert arenas; signaling a new generation of SumUp merchants coming into play. SumUp has also recently completed the acquisition of the core banking system provider Paysolut, as part of its strategy to build up its offering of banking services for merchants.