Report: Payleven, A European Square From Rocket Internet, Gets Funding From NEA, Holzbrinck, Ru-Net

by Blogburger on June 22, 2012

payleven

With Square yet to enter Europe, there is an increasing amount of activity from would-be competitors looking to fill the same niche using dongles on smartphones to enable card payments. The latest comes from Payleven, which has picked up “tens of millions” of euros in funding from New Enterprise Associates, Holtzbrinck Ventures and the Russian VC ru-net, according to an unconfirmed report in Deutsche Startups. Payleven is part of Rocket Internet, the incubator/investment vehicle from the Samwer brothers (known for developing clones of popular U.S. services like Groupon — and then selling them as part of inorganic growth plays).

Rocket Internet is famously secretive about who invests in its projects and how much, so it’s been hard to pin this one down. The responses we’ve received have been not flat-out denials, and with a wide berth might even read them as indirect confirmations. But they’re thin on detail: “Unfortunately we cannot provide any more colour on that [news],” Holzbrinck told TechCrunch. “I think you’re very well aware of Rocket’s policy on disclosing information to the press.” ”As usual Rocket is not very open minded about publishing information about the funding,” another person close to the deal said. Rocket Internet, meanwhile, has also declined to comment directly but has opened the kimono a little to outline Payleven’s strategy going forward.

The company is already active with its payments service in Germany and Brazil.  According to Fred Klinkert, Rocket’s manager for global venture development, the plan is to expand further to “key European and large emerging markets.”

In fact, this puts the company somewhat in contrast with another Square competitor, the Stockholm-based iZettle, which last week grabbed a $ 31.4-million round from Greylock, MasterCard and more. Its CEO Jacob de Geer told TechCrunch at the time of the announcement that the funds would be used to expand in Europe, not elsewhere. (Square, by comparison, has raised $ 141 million at a $ 4 billion valuation.)

Meanwhile, Rocket Internet has been busy with other activity in emerging markets, an increasing focus for the company. FoodPanda, an online food ordering service, is now open for business in India, following on from FoodPanda sites in Columbia, Indonesia, Malaysia, Singapore, Thailand, Taiwan and Vietnam. Other e-commerce operations covering home furnishings (yes, Fab clones) and more are also part of the plan.

There is another area where Rocket’s Payleven stands out from Square and iZettle, and could make it one to watch ahead.

Like Square and iZettle, Payleven is largely aimed at merchants and others who have not had the facilities to process card payments at the point of sale. While Square and iZettle have spent a lot of resources encouraging merchants to sign on to their platform, Rocket Internet has a portfolio of other operations that could serve as a very immediate route to customers for Payleven’s dongles: take-out food companies (FoodPanda) and private accommodation (for its Airbnb clone Wimdu) among them.

Also, it should be pointed out that although the Samwers’ are often dismissed as clone makers, they have continued to attract not only customers, but investment and partnerships with established players. Across the markets where Payleven is already in business, it has deals with MasterCard, American Express and Eurocard (Germany) and AmEx, Diners’ Club, MasterCard and Visa (Brazil). Their Wimdu venture has had $ 110 million in backing so far, Deutsche Startups points out.

NEA has not yet responded for this story, but there is a past connection between the company and Rocket.

NEA was one of the earliest investors in Groupon, a company that also bought one of the Samwer brothers’ previous ventures, CityDeal, and subsequently put brothers Oliver and Marc Samwer in charge of the European operation — a position that has only changed in the last couple of months, with the brothers stepping down from their managerial roles and getting replaced by an ex-Dell executive Veit Dengler, who is now SVP in charge of Europe, based in Austria.




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