SumUp offers solutions for processing credit card payments through mobile devices. Currently operating in 11 European countries, it accepts payments via EMV chip cards, among others, and is compatible with all major credit cards. The startup offers businesses accounting tools as well, including sales histories, group transactions and invoices.
Much of SumUp’s success to date may be contributed to the know-how and experience of Daniel Klein, the German entrepreneur who founded SumUp in 2011. Klein and his team provide businesses an alternative way to accept credit card payments and, in turn, increase sales. They have developed a device that attaches to iOS and Android smartphones and tablets that allows for simple, transparent and affordable transactions. Businesses, in general, pay a fee of 2.75% per transaction to use the SumUp system.
SumUp has proven to be a high achiever in the investment realm. It closed a hefty Series A round (double-digit million euros) in the second quarter of 2012, with participation from b-to-v Partners, Shortcut Ventures, Tengelmann Ventures and business angels. And in May, Groupon and American Express joined as investors.
For BBVA, SumUp represents an opportunity to lead the way in new payment technologies and is aligned with the bank’s overall strategy of innovation. Jay Reinemann, Executive Director of BBVA Ventures, elaborated:
SumUp changes the way point of sale interaction works on a global scale. At BBVA we pride ourselves in driving innovation in the financial sector globally. That’s why we are very excited about investing in SumUp: In less than a year, the team has proven that they can change an entire industry and enable small merchants to run their businesses more successfully. That’s a great fit with what we stand for.
This deal marks BBVA Ventures’ first investment in Europe; however, Latin America will be the focus of the relationship. SumUp plans to draw upon BBVA’s banking experience and international prowess to expand its business into the region.
Klein, who now acts as CEO of SumUp, remarked:
We are delighted to bring on BBVA as a new financial investor. Receiving the financial backing from such an important international player of the financial industry is a clear endorsement of SumUp’s potential to reinvent the point of sale experience on a global scale. We’re looking forward to the great things we will achieve together with BBVA – in Europe and South America.
With US$100 million to invest in finance-related startups, BBVA Ventures shows no signs of slowing down following this SumUp agreement. Its portfolio also includes accelerator 500 Startups, risk capital fund Ribbit Capital, and data management endeavor Radius.
Trend to Watch: Banks in Mobile
The competition in Latin America’s mobile payment market is heating up, with entities like Clip, Zoop and Mobiliz in the mix, and Square most certainly on the way. However, there is one pattern – or at least a set of similar cases – in the way banks are getting involved.
Just weeks before BBVA’s SumUp investment, a similar agreement was revealed – a deal between Europe’s Banco Santander and mobile payment startup iZettle. Again, this is a case of an international bank backing a European entity, both parties with an eye on the Latin American market.
Given the similarities between these two cases, might we expect a third?