Akihabara News (Tokyo) — PayPal has acquired Paidy, one of Japan’s few unicorns, or privately-held startups valued over US$1 billion, in a blockbuster deal to expand its reach into the Japanese market.
The ¥300 billion (US$2.7 billion) acquisition, expected to be formalized by the end of the year, will see Paidy continue to operate much as it does at present, and its top management remain in place.
PayPal hopes that Paidy, with its 4.3 million active customer accounts, will help it crack the “buy now, pay later” market in which the unicorn excels.
Paidy customers do not pay interest on the delayed payments. Rather, the firm collects a small fee from merchants when customers make purchases at their shops or businesses.
“Paidy pioneered buy now, pay later solutions tailored to the Japanese market and quickly grew to become the leading service, developing a sizable two-sided platform of consumers and merchants. Combining Paidy’s brand, capabilities and talented team with PayPal’s expertise, resources, and global scale will create a strong foundation to accelerate our momentum in this strategically important market.” commented Peter Kenevan, vice president and head of Japan at PayPal.
Paidy’s payment services allow Japan’s shoppers to make purchases online, and then pay for them each month in a consolidated bill at a convenience store or via bank transfer. The company uses its own technology to score creditworthiness, underwrite transactions, and guarantee payment to vendors.
Russell Cummer, founder and executive chairman of Paidy, stated, “There is no better home for Paidy to continue to grow and innovate than PayPal, which has been removing friction from online shopping for more than twenty years… Together with PayPal, we will be able to further achieve our mission of taking the hassle out of shopping.”
Riku Sugie, president and CEO of Paidy, added, “Paidy is just at the beginning of our journey and joining PayPal will accelerate our plans to expand beyond ecommerce and build unique services as the new shopping standard.”
Paidy was originally established under a different name in March 2008.
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