Homegrown fintech startup NextPay, raised over P80 million (US$1.6 million) in seed funding from international and local investors to develop more digital financial services for the country’s underserved small businesses.
Singapore-based venture capitalist Golden Gate Ventures and Gentree Fund led the oversubscribed seed financing round.
Golden Gate Ventures has interests in digital leaders Omise, Codapay, BukuWarung, Stripe, and Xendit, while Gentree Fund is a private investment vehicle of the Sy Family, which owns Filipino conglomerate SM Group.
Among other foreign investors that participated in the seed funding round are Tribe Capital, Broadhaven Ventures, 1982 Ventures, Saison Capital, and Razorpay, Rohit Mulani of GoTrade, and Abhinay Peddisetty and Chinmay Chauhan of BukuWarung.
Goodwater Capital, which has invested in Facebook, Spotify, and Twitter, also supported the funding exercise.
Locally, NextPay’s seed funding was backed by Kickstart Ventures of the Ayala Group, Foxmont Capital, and First Asia Ventures, as well as angel investor Lisa Gokongwei of JG Summit.
NextPay will use the proceeds of the seed fund to expand its suite of services and customer base, introducing new digital banking solutions to micro, small, and medium enterprises (MSMEs).
“We believe that business banking will continue to evolve digitally as the Philippines accelerates its digital transformation initiatives,” says NextPay Chief Executive Officer and Co-Founder Don Pansacola
“This investment supports our goal of putting the power of big banks in the hands of small businesses,” he stressed.
The fundraising marks a milestone for NextPay after graduating from the Y-Combinator program in April, when it received $125,000 in pre-seed investment.
“NextPay is building the best banking platform for Filipino SMEs,” according to Golden Gate Ventures Partner Justin Hall.
The platform provides underserved customers democratized access to easy and affordable financial services such as digital invoicing, cash management, and batch payments to any bank or e-wallet in the Philippines.
Launched amid the pandemic in 2020, NextPay empowers growing companies, entrepreneurs, and freelancers with a spectrum of digital financial services previously unavailable to them due to steep requirements and high fees.
Since last year’s launch, NextPay processed over P457.5 million (over US$9.1 million) in digital transactions for more than 100 businesses with over 3500 employees.
Now, the platform intends to introduce more meaningful digital banking solutions, including, but not limited to, corporate cards, loans, and integrations with other platforms focused on MSMEs, disclosed NextPay Chief Experience Officer and Co-Founder Aldrich Tan.
“We will also hire more talents to make the NextPay platform more comprehensive, simple, and easier to use,” he coninued.
“We aim to provide the best service and experience so our customers can focus more on growing their businesses.”
Through its pay-per-use model, NextPay offers competitive fees that are lower than usual banking rates.
Customers of NextPay also enjoy reduced processing times from as much as 3 days to just 30 minutes or less.