iZettle acquisition by PayPal advances its mission to help small businesses grow and thrive in the global digital economy
PayPal Holdings has agreed to acquire iZettle, a small-business commerce platform in Europe and Latin America, for US$2.2 billion/£1.64 billion. The acquisition of iZettle significantly expands PayPal’s in-store presence, strengthening its platform to help millions of small businesses around the world grow and thrive in an omnichannel retail environment.
“Small businesses are the engine of the global economy and we are continuing to expand our platform to help them compete and win online, in-store and via mobile. iZettle and PayPal are a strategic fit, with a shared mission, values and culture—and complementary product offerings and geographies.
“In today’s digital world, consumers want to be able to buy when, where and how they want. With nearly half a million merchants on their platform, Jacob de Geer and his team add best-in-class capabilities and talent that will expand the company‘s market opportunity to be a global one-stop solution for omnichannel commerce,” said PayPal President and CEO, Dan Schulman.
This combination brings together iZettle’s in-store expertise, recognised brand and digital marketing strength with the company’s global scale, mobile and online payments leadership, and trusted brand reputation.
Upon closing, the company gains in-store capabilities in the following 11 markets: Brazil, Denmark, Finland, France, Germany, Italy, Mexico, Netherlands, Norway, Spain and Sweden.
It also gains near-term in-store expansion opportunities into other existing markets, and acceleration of omnichannel commerce solutions in Australia, UK and US.
“Combining our assets and expertise with a global industry leader like PayPal allows us to deliver even more value to small businesses to help them succeed in a world of giants,” said iZettle CEO Jacob de Geer.
“The combination of iZettle and PayPal will provide tremendous benefits to our merchants who will have access to an even wider range of tools to help them get paid, sell smarter and grow,” said PayPal President and CEO Dan Schulman.
iZettle expects to generate gross revenues of approximately US$165 million/£123 million in 2018, with approximately US$6 billion/£4.5 billion of total payment volume (TPV) expected to be processed on its platform. The company has grown its revenues at a CAGR of approximately 60% from 2015 to 2017. iZettle expects to reach EBITDA profitability by 2020 on a standalone basis.
Once the acquisition closes, Jacob de Geer will continue to lead iZettle, which will operate as an integral part of the company’s merchant services offering, reporting to the company’s Chief Operating Officer, Bill Ready.
iZettle’s experienced management team, who have a demonstrated track record of scaling at pace, will continue running the business, ensuring continuity for customers, employees and partners. Upon closing, iZettle will become the European centre of excellence for the company’s in-store product and services offerings.