Fintech startup PayMongo banks $12m in Stripe-led round

Filipino-owned fintech startup PayMongo said it recently secured US$12 million in series A funding in a round led by online payment processing major Stripe.

Other existing backers Y Combinator and Global Founders Capital, as well as new investor Bedrock Capital, also participated in the round, according to a statement.

PayMongo CEO and co-founder Francis Plaza / Photo credit: PayMongo

Based in Manila, the startup allows its client merchants to receive payments online through shareable payment links and APIs, among others. Its payment platform also provides onboarding and check-out services with built-in fraud detection systems.

The new investment brings PayMongo’s total amount raised to almost US$15 million, almost a year since its June 2019 launch with a seed round of US$2.7 million.

What are its future plans? The company said it plans to use the new funds to further accelerate its rollout of new products and features. In addition, PayMongo said it is looking to make new hires to build up its product, design, and engineering teams.

Specifically, PayMongo CEO and co-founder Francis Plaza told Tech in Asia that the company is prioritizing adding more online payment options, supporting other models such as subscriptions, building more partnerships, improving its risk systems, and focusing on invoicing and marketplaces, among others.

“We also aim to secure additional licenses from the central bank that will enable us to venture into offering other financial products,” Plaza added.

How much traction has it gotten? “Philippine digital transactions surged by 42% in value between January and April 2020, and would likely meet the targets set by the country’s central bank – a growth driven by the necessary shift online amid strict community quarantine measures,” the company said in a statement.

Since the start of the year, PayMongo claimed it saw transaction volumes soar by 15x. The company also said that it had onboarded thousands of Filipino businesses, including small entrepreneurs, restaurants, and fast-food chains, a month after the government had imposed a nationwide lockdown in April.

“We have processed almost US$20 million in total payments since launching just about a year ago, growing at an average of 60% since the start of the year, with a huge surge since the lockdown was put in place,” the CEO shared.

What challenges has it faced recently? According to Plaza, PayMongo had initially planned to go through with its fundraise by early to mid-next year, but the company decided to fast-track the process to meet the unexpected demand brought by the ongoing pandemic.

“We’ve grown so fast over the last couple of months, and the level of demand in the market has amplified our value proposition and our product-market fit. The demand has grown insanely higher than we initially expected, and a lot of improvements as well as new products need to be built to support the ever-growing demand for our services,” the head chief noted.

What is the company’s funding history?