UK Online Payments Platform GoCardless Raises $3.3 Million Series A, Plans To Expand Across Europe

GoCardless, the Y Combinator-backed payments startup based in the U.K., has raised a $3.3 million Series A round of funding, led by existing investors Accel Partners and Passion Capital. The company had previously raised $1,5 million in seed funding in early 2012, following its participation in the Y Combinator Summer 2011 class. Founded in 2010 by Oxford graduates Hiroki Takeuchi, Tom Blomfield and Matt Robinson, the service helps businesses of all sizes establish automatic bill pay, direct debits, and recurring payments. As the startup’s name implies, the system is meant for use by merchants who can’t or don’t want to take credit card payments. “Stripe makes it really easy for developers to get card payments, and Square makes it really easy for small merchants to take card payments,” explains Robinson. “But what do you do if card payments just don’t work for you? That’s the hole we fill.” He also notes that card payments can sometimes have double-digit failure rates, and for those companies running a SaaS (software-as-a-service) business, these failures can kill them. With GoCardless, however, failure rates are really low because, unlike credit cards, users’ bank account details don’t change that often. The system, for those unfamiliar, takes advantage of interbank transfers. Stateside, we refer to these as “Automated Clearing House” or ACH payments. Though you might not be familiar with the terminology, if you’ve ever switched on Automatic Bill Pay with your bank to pay a utility vendor, for example, then you’ve used ACH before. While other startups like Dwolla have since come along to blow up the entire ACH network by building its own real-time alternative, ACH payments are still a standard that businesses are comfortable with today. The problem, however, was that for smaller merchants, the process of setting up automatic and/or recurring payments has been complicated and costly in the past. GoCardless changes that by making its fee structure more affordable – there are no setup or monthly fees, and then just 1 percent (up to??2) in transaction fees. Robinson says that there are now more than 5,000 merchants using the system – up from 2,000 in May of last year. And that’s despite the fact that the startup hasn’t yet had the resources to expand outside the U.K. to the rest of Europe, as previously promised. That’s one of the immediate goals, following the Series A funding, we’re told. The other is to

Source: http://feedproxy.google.com/~r/Techcrunch/~3/UTw-M41V9Tg/

doobie brothers jennie garth peter facinelli marques colston golden state warriors free agents nfl 2012 milwaukee bucks bear grylls