Prepaid Technologies, a Birmingham, Alabama-based provider of prepaid digital payment solutions, has raised USD96 million in new growth financing in a funding round led by Edison Partners, a growth equity firm.
StepStone Group (which recently acquired venture capital platform Greenspring Associates) co-led, while Stifel Venture Bank, a Division of Stifel Bank, and Top Tier Capital Partners also participated. The company will use the proceeds to accelerate its market expansion and continue to advance its category-leading technology payments platform and customer-focused prepaid solutions.
Analysts estimate USD120 trillion in business payments are still check-based, and service providers are fragmented across multiple vendors for verticals such as payroll, rewards, purchasing and disbursement. These four opportunities alone represent USD80 billion addressable markets, growing at more than 10 per cent annually and accelerating with the proliferation of smartphones, e-commerce, and digitised payments since the pandemic’s onset. Prepaid Technologies enables its customers to access and customise B2B and B2C payments across these segments with a unified innovative fintech partner with a focus on the consumer and end user experience.
“Prepaid Technologies is making it easy for businesses to transform their outdated disbursement, payroll, and purchasing processes with real-time digital payments across niche categories where competitors don’t have the same level of depth or expertise,” says Jennifer Lee, Partner, Edison Partners, who co-led the investment.
“This is a unique product offering, where a company can access and customise different payment solutions in a one-stop shop. We’re impressed with Stephen Faust and the management team’s ability to remain capital-efficient while growing organically and profitably. We look forward to working with them as they execute on their vision,” adds Lee. “Modern payroll and expense management for remote workforces continues to see strong traction through the last 18 months. B2B payments are also trending higher as companies opt for disbursement solutions that make it easier and safer to deliver corporate funds. These tailwinds bode particularly well for the company’s growth and provide a moat for adjunct product opportunities.”
“We purpose-built our platform to create a turnkey way for companies to configure payments solutions across their enterprise however they operate. Clients access payments through our dashboard technology or integrate solutions into their workflows through our robust API suite. We’re laser-focused on productisation and customisation that will help to transition more companies to card-based and digital solutions. With this investment, and with Edison Partners’ expertise and experience, we can focus on investing in our current solutions, accelerating our industry footprint and expanding our suite of offerings to ensure our customers and partners achieve their goals,” says Stephen Faust, CEO, Prepaid Technologies.
“Loyalty payments and refund programs present an enormous niche opportunity. There is both a programmatic vertical opportunity and underserved community opportunity. Prepaid Technologies has an incredible load volume and data set, and the management team has deep banking and payments expertise, which we’re confident will bode well for the company’s continued growth and deliver value to customers and partners around the globe,” says Chris Sugden, Managing Partner, Edison Partners, who will join the board of directors.
Recognized by LendIt Fintech as Fintech Equity Investor of the Year, Edison Partners has financed and guided more than 50 private fintech market leaders. The firm’s current active portfolio includes Bipsync, ComplySci, Fund That Flip, GAN Integrity, Giant Oak, GoHenry, Houwzer, MoneyLion, Nuula, Yieldstreet, and Zelis.
The investment in Prepaid Technologies is Edison Partners’ first investment in Alabama and is the firm’s third growth financing in an underserved market this year following investments in Boulder, Colorado-based The Pros Closet and Houston, Texas-based MacroFab.
