NomuPay — the payments startup created from some of the healthiest pieces of dramatically failed fintech Wirecard — has made an acquisition as it continues its trajectory for better economies of scale. He has collected Full Edita Manchester startup that creates payment processing solutions for functions such as recurring payments, risk management, PCI (data security) compliance and payment integrations.
NomuPay is paying about $35 million for Total Processing and says the company’s total value is now $135 million.
For some context on that number, Total Processing doesn’t appear to have disclosed any outside funding since it was founded in 2015.
Dublin-based NomuPay announced earlier this year that it had raised $53.6 million in funding, and PitchBook valued the startup at just under $172 million in September 2022. NomuPay says PitchBook’s estimate is inaccurate and that “the valuation has been steadily rising,” according to NomuPay CEO Peter Burridge.
This is an important point, given how many pullbacks and writedowns there have been in the tech industry over the past year.
NomuPay has so far focused on acquiring or buying payment processing licenses in Southeast Asia, Europe, Turkey and, in the long term, the Middle East. However, Burridge told TechCrunch that he sees Total Processing as an opportunity to add more tools around this core payments function, as well as customer service for its business users.
“No one drives a car without a spare tire,” he said of the deal and how it widens the funnel of what NomuPay can offer its customers. “The value proposition is that Total Processing has this technology stack that is all about solving the merchant’s pain. And it’s also consultative selling. You will never get a response from a real person at Stripe or Adyen. You don’t talk to anyone.”
The plan will be to continue scaling Total Processing now to expand into more markets, starting with Hong Kong and Southeast Asia. Total Processing itself has been most active in the UK and UAE and NomuPay will leverage this to expand its own footprint. Neither company has disclosed how many customers it has, or turnover (i.e. revenue).
M&A presents itself as a very viable option for a number of startups that may have interesting underlying businesses and technology, but are struggling to close rounds on terms that make sense to them, but may need more runway to operate or grow . Right now it’s a buyer’s and supporter’s market.
Consolidation is also a long-standing theme in fintech that predates the current funding downturn. Margins remain slim for many digital payment services – largely due to the many stakeholders looking for a cut – so combining forces for better economies of scale across wider geographies, or offering a fuller stack of services to customers, is a no-brainer.
