Voice of the Industry

Startups to watch – the 'Dark Horses' of 2022

Monday 29 August 2022 11:02 CET | Editor: Anda Kania | Voice of the industry

Alexandra Constantinovici of The Paypers details on what startups we should keep an eye on in 2022 and beyond, as well as what trends tie in with these young companies.


When you want to find out what’s ‘cool’, you better turn to what each generation’s youth are doing. This axiomatic truth lives its best life in the ecommerce payments ecosystem as well. In the past couple of years, we’ve been putting this market segment under a magnifying glass, looking to see what the newcomers are up to, in order to confirm established theories and learn from their strategies. 

So far, year after year, we’ve set our eyes on companies that proved to become unicorns and established names on the market for the following iteration of this overview. In this edition’s Startups to Watch roundup, we will be focusing on a couple of representative names for the startup segment that seem to ride the wave of innovation in full force. 

With the total ecommerce market worth approximately USD 4.89 trillion (and growing rapidly), according to Shopify, this year’s picks speak volumes on the existing booming trends such as Buy Now, Pay Later, A2A Payments and the refinement of payments infrastructure.

Europe – the land of regulatory opportunity

Key focus: A2A payments

Lithuanian fintech kevin. has been on everyone’s radar (including ours, in the 2022 edition of the Who’s Who in Payments Report) in the last short couple of years. With A2A still in its infancy when it comes to infrastructure and adoption into ecommerce, the market was ripe for systems built around APIs that were easier to integrate into physical stores. As Pavel Sokolovas – Founder & COO of kevin. explained to TechCrunch, Account-to-Account is a cheaper process and ’so we had a huge opportunity to solve [integration and expansion issues], especially in ePOS’. 

They essentially created an NFC A2A payment solution with a seamless user experience comparable to that of a card payment linking merchants with customers’ bank accounts directly, with plans to cover 35% of all European ePOS terminals by the end of the year.

It’s easy to envision big actors in the paytech ecosystem or even big issuers (such as Visa, who dove deep into A2A in the past year) looking to acquire this emerging startup, as it gains a bigger slice of the ecommerce payments pie. According to TechCrunch, kevin. has declined to work with market incumbents in this field even as strategic investors, in order to stay neutral and not tied to any specific platforms.

The startup is currently working with 6,000 merchants in 12 European markets integrating payments via POS, either physical or electronic. Following several pre-seed rounds, in May 2022, kevin. raised USD 65 million in a Series A round to build out its technology and hire more people to enter new European markets.

Key focus: Buy Now, Pay Later

Alma is a BNPL company born in France in 2019, facilitating instalments payments both in-store and online. In these less than three years since its debut on the market, the BNPL provider built a portfolio of over 4,000 retailers from niche segments to famous brands such as Kookaï, Devred, Go Sport, Top Office, La Fée Maraboutée, and they also process almost half a billion euros annually. The company raised EUR 49 million in 2021 in a Series B and EUR 115 million in Series C in February 2022, with an additional EUR 95 million in debt financing.

The market penetration strategy they employed seems to be riding the wave of popularity that big players like Klarna are benefiting from right now on a global level, while scaling rapidly not just in reach, but also in their product offering and tech (they launched a mobile app the at the beginning of the year that will be allowing customers not just to manage their transactions and look for instalment plans and ecommerce deals, but also provide virtual cards later in 2022). 

It will be worth it to see how the app will develop after its rapid geographical expansion – after launching and growing in market share in Spain, Italy, Germany, and Belgium, Alma will be looking to expand in the Netherlands, Luxembourg, Portugal, Ireland, and Austria. 


Key focus: Payments Infrastructure 

Gr4vy is a ‘no-code’ payment orchestration platform based in the US, but available at a global level. Even though the company was founded in 2020, with most of its activities rolling out since 2021, Gr4vy has already closed a wide array of partnerships with various players in the industry such as Vyne for Open Banking payments, livestream platform ELEVEN, Banked, GoCardless, Boku, and EBANX. Over the course of three rounds, Gr4vy has raised a total of USD 27.2 million. 

As an extension to its portfolio, Gr4vy’s cloud-native payment orchestration platform (POP) also offers Instances, which provides merchants infrastructure in the cloud. Company officials have been vocal about their goal to fill the gap in payments infrastructure efficiency left from a disproportionate transaction volume rise during the pandemic compared to what merchant systems could sustain. 

Key focus: Blockchain 

M10 Networks provides a turnkey platform delivered as a cloud-based service and based on immutable hierarchical ledger technology. operated by a proprietary, permissioned blockchain. It tokenises regulated liabilities such as central bank money, commercial bank money, and e-money, and can be configured to meet the digital money needs of central banks and commercial banks. 

M10 reportedly prioritises markets where traditional cross-border payments suffer from high cost, slow speed, and poor access. As per the company’s strategy, their go-to-market approach is to work with commercial and central banks in the Middle East, Africa, and Asia, to address market inefficiencies in cross-border payments and greenfield Central Bank Digital Currency (CBDC) opportunities. M10’s partners include FIS, IBM, BPC, and NIFT. 

It was impossible for CBDC to not be among the interest topics of payments facilitators given the plethora of announcements and initiatives debuted in the last two years 


Key focus: Buy Now, Pay Later 

Pace is a 2020-founded online payment platform that allows users to pay for their purchases in three interest-free instalments. Pace has raised a total of USD 40 million in funding over 4 rounds. Their latest funding was raised on 15 February 2022 from a Series A round. 

Pace has acquired the assets of its competitor Rely for an undisclosed amount. Rely is a BNPL startup in Singapore, offering consumers interest-free instalments on purchases. Its partner retailers include Qoo10 Singapore, Zalora and JD Sports. This is just another example of a small player gaining visible traction in Southeast Asia in a very short time span. 

Key focus: Card issuance technology 

For all the conversations spurred across the industry over card scheme dominance, one of the immutable truths lurking in the background is that card payments will not be phased out in the foreseeable future. And startups know this as well. 

Hyperface is the developer of a card platform designed to simplify credit card issuance for fintechs and ecommerce firms. The company offers customisable software development kits (SDKs) and application programming interface (APIs) to allow customers to design credit card programmes and manage the entire customer experience, from KYC requirements to loyalty programmes. Embodying the principle ‘if you can’t beat’em, join’em’, the startup is set to help businesses launch credit card programmes in only a few weeks. 

Hyperface raised USD 1.3 million in October 2021 which it said it will use to strengthen its tech platform and launch card programmes, as well as for hiring and growth. 


Key focus: Payments infrastructure 

Flutterwave, a fintech company that provides a payment infrastructure for global merchants and PSPs, has been included in our Startups to Watch overview since its first iteration in 2020. And we still feel inclined, two years later, to include it on this list.

The startup raised USD 250 million in a Series D round that tripled the company’s valuation to over USD 3 billion in just twelve months. In March 2021, the startup raised USD 170 million in a Series C round from Tiger Global and Avenir at a valuation of USD 1 billion. The latest financing brings Flutterwave’s total raise since its inception six years ago to USD 475. 

Flutterwave changed the understanding of Africa’s potential in the cross-border payments infrastructure niche by facilitating transactions for small to large businesses in Africa via one API. The company also helps businesses outside Africa expand their operations on the continent. Some of its international clients include Booking.com, Flywire, and Uber. 

Furthermore, they have been on an expansion spree, going from sub-Saharan Africa to Egypt and Morocco. These last couple of moves are a clear indicator of the company’s direct move into the Middle East, with further plans for Latin America. According to company statements, apart from geographical expansion, the payments infrastructure provider aims to also invest the newly acquired capital into product development. 

What’s certain, after seeing the rise of this payments startup is that, inevitably, Flutterwave is well on its path to leaving the startup label behind and establishing itself as a household name in the industry. 

Key focus: Mobile payments 

Another startup from the African continent making waves comes from the mobile payments niche. Nigeria-based OPay designs a mobile payment service and consumer platform that prides itself with being a one-stop mobile-based platform for payment, transportation, food and grocery delivery, and other important services in everyday life, a service that complements well enough the emerging market it operates in need of inclusive and holistic services. As company data shows, millions of users rely on OPay every day to send and receive money, pay bills, and order food and groceries. 

OPay notably raised a total of USD 570 million in funding over three rounds. Their latest capital influx was announced on 23 August 2021 from a Series C round. 


Key focus: Card issuance technology 

In the same vein as Hyperface’s path and strategy comes Ualá, an Argentina-based fintech company providing an app and an international Mastercard card. The startup’s main focus revolves around bringing the unbanked into the financial system by offering a free card, with no issuance, renewal, maintenance, and closing costs. It can be used to make purchases on any website or store in the world that accepts Mastercard. In addition, it offers the possibility of transferring money, paying bills, and topping up cell phones and transportation cards. Users can also track expenses through an analysis tool, apply for loans and invest in mutual funds. 

With more than 3.100 million cards issued, it is available throughout Argentina for anyone above 13 and Mexico for anyone above 18, both for Android and iOS. Ualá has raised a total of USD 544 million in funding over 8 rounds. Their latest funding was raised on 13 August 2021 from a Series D round. Another telling example of startups firmly narrowing down on the possibilities still left untapped in the card payments spectrum. 

Key focus: Payments infrastructure 

B2B payments never lagged behind the top trends proliferated in the payments and fintech space. Clara is an end-to-end spend management for companies that focused keenly on credit cards and spend management solutions aimed directly at SMEs and has grown exponentially in Mexico, making it currently Latin America’s fastest startup to gain unicorn status. Clara’s valuation exceeded USD 1 billion in May 2021 after it raised USD 80 million in a Series B fundraising round. In Brazil, Clara is selling credit cards, making use of its agreement with Mastercard. Market analysts argue that this is a case where a startup gained a lot of traction with a product expansion after it piggybacked on its flagship product, which is their expense management service for businesses. 

The fintech is set to expand its operations throughout Spanish-speaking Latin America, including Chile, Colombia, Peru, Argentina, and Panama. According to company officials, Clara, with existing clients such as Justo, Kavak, and Sofia Salud, has on its roadmap a fivefold increase in its customer base just by the end of 2022. We will be monitoring this objective and see what market levers they will use to push this plan forward. 


Key focus: Payments infrastructure 

Zeller is a startup launched in 2020 in Australia that enables business owners to accept payments, manage their finances, and pay recipients fast. The company rose to prominence quite fast, considering that in March 2022 the company hit an AUD 1 billion valuation thanks to an AUD 100 million Series B funding round.

In their credo, the startup explains that ‘the vast majority of Australian businesses are underserved due to a lack of innovation, disparate providers, opaque pricing, and restrictive contracts’. This might seem like a marketing pitch, but when the Australian Government reviews the status of the country’s payment system in 2021, one of the strategic plans for the future was ‘to be dynamic and sufficiently flexible as circumstances change in the payments ecosystem’, while aiming to develop ‘common access requirements for payment systems to facilitate transparent access to payment systems’. 

Another relevant name for the Australian market is Zepto. The startup creates real-time, data-driven, account to account merchant payment solutions for the on-demand economy. Zepto notably raised USD 200 million in May 2022, while also becoming the first non-bank approved as an NPP-connected institution in October 2021. That means Zepto will be able to connect its clients directly to the NPP’s PayTo service, which is due to roll out in mid-2022. 


Startups to watch in 2022


Looking ahead… 

There are several highly discussed trends marinating in the public quorum this year, from the rise of the metaverse and the payments intricacies it brings into focus, to the boom of A2A payments as a primary application to the Open Banking infrastructure and regulatory initiatives developed globally over the last five years, all the way to BNPL’s rise to fame, or the ever-changing nature of crypto payments. 

Considering these key trends, we’ve counted several examples of companies making their names in the industry by capitalizing on the increase of ecommerce volumes and the constant necessity for better and easier to manage payment processes. However, we postulate that startups will always tread with a mix of caution and exuberance in the industry. While promptly picking up the right trend to follow or the right market to expand in, they will also choose to take existing needs in their niche and develop better and easier to use product offerings than their established peers. It’s the unwritten recipe by which we can assess past and future success stories.

This article was first published in Who’s Who in Payments Report 2022, the most recent market overview and analysis of key payment providers in the B2B and B2C commerce payment ecosystem. 

About Alexandra Constantinovici

Alexandra is Senior News Editor at The Paypers. A passionate writer, Alexandra has an extensive background in journalism – as a graduate of Journalism and Communication studies –, as well as editing, publishing, and marketing. She coordinates the news coverage at The Paypers and, together with the team of editors, she strives to bring forward the latest trends for our readers, while investigating and sharing with our community the upcoming innovative industry shifts.

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Keywords: startup, fintech, BNPL, payments infrastructure, account-to-account payment, funding
Categories: Payments & Commerce
Countries: World
This article is part of category

Payments & Commerce