Wayflyer to fund rapid growth with $300 million J.P. Morgan debt line

DUBLIN : Irish fintech Wayflyer has secured and begun deploying $300 million in debt financing from J.P. Morgan and now expects to advance up to $2.5 billion to e-commerce firms this year, it said on Thursday.

Wayflyer, which provides firms with non-dilutive, unsecured working capital by buying a portion of their future sales, said earlier this year it would lend over $1 billion in 2022, but chief executive Aidan Corbett told Reuters its growth was ahead of forecast and now expects to do $2-$2.5 billion.

Wayflyer lent $50 million in its first year in operation in 2020 and around $500 million last year. That was before its value hit $1.6 billion in February after raising $150 million in equity financing to become Ireland’s sixth “unicorn” – privately-held startups valued at over $1 billion.

“The core thing from our business model perspective is as we scale we need really strong external finance partners,” Corbett said of the debt warehouse line provided by J.P. Morgan, which also took part in February’s series B funding round.

“We will be continuously raising debt. We have a lot of equity right now … so definitely in the next 18 to 24 months, we wouldn’t plan on doing any equity raises. But on the debt side, we’ll keep doing it and move gradually towards a securitisation at some stage in the future.”

The deal reduces Wayflyer’s cost of debt “enormously”, Corbett said, declining to disclose the terms. It means the U.S.-focussed fintech can lower the fee firms are charged in lieu of paying an interest rate and lengthen repayment periods.

Wayflyer, which also offers detailed analytics alongside the funds it says customers can draw down in days, plans to “cherry pick” two or three new European markets to enter, Corbett said, potentially including France and Germany.

It also expects to launch “at least” two or three additional products next year.

With global e-commerce set to exceed $5 trillion this year, according to Statista, J.P. Morgan Global Head of Trade and Working Capital Stuart Roberts said the U.S. bank had decided to “go all in” on its e-commerce strategy and that Wayflyer was a significant part of it.

“In the medium term, we knew at J.P. Morgan we’re not going to go the route of some competitors and build something in house. It would take too long and we wanted something to be nimble,” Roberts told Reuters.