HomeFundingBerlin-based Payrails raises €13.5 million in Seed extension to scale payment operating...

Berlin-based Payrails raises €13.5 million in Seed extension to scale payment operating system across industries

The digital payments market generated €1.4 trillion in revenues in 2021 and is projected to reach €3.1 trillion by 2031. And while payments continue to be a fragmented area for platforms, marketplaces and any large, fast-growing companies that conduct business across markets or with multiple parties in payment flows, the only option for them was to build an expensive in-house payments team, until recently.

Payrails, a payment operating system for global platforms, announced today that it has raised €13.5 million in a Seed extension to scale its next-generation financial operations (FinOps) platform. The round was led by new investor EQT Ventures. Also joined General Catalyst, alongside existing investors Andreessen Horowitz and HV Capital. 

The funding demonstrates trust in Payrails’ product that is being utilised by large international companies across industries. With the new capital, the business has raised €19.5 million to date. 

Recognizing the absence of a product in the market that provides a complete solution for high-growth businesses, Payrails’ experienced founder team, comprised of Orkhan Abdullayev, Emre Talay, and Nicolas Thouzeau, who together built the FinTech arm of Delivery Hero, the world’s largest delivery platform, set out to change this. Seizing this market opportunity, they created Payrails in 2021, an end-to-end operating system that spans the entire payment processing value chain.

Orkhan Abdullayev, CEO and Co-Founder of Payrails, comments: “We are extremely proud of what we have built and look forward to the journey ahead. As payment processing gets more complex once companies scale, the need to keep advancing the payment stack and leverage multiple processors to improve performance becomes the industry standard. Leading companies understand the strategic importance of optimising payments and are searching for flexible solutions that can adapt to their needs. With EQT Ventures, General Catalyst, Andreessen Horowitz and HV Capital, we have found strong partners with significant experience in FinTech and payment systems who believe in our long-term vision of enabling large-scale global platforms to build end-to-end payment solutions as we develop the next-generation payment operating system.”

Amid initial solid customer interest, Payrails will use the fresh capital to accelerate its product roadmap to solve its customers’ complex payment challenges and increase go-to-market capacity, catering to its strong customer pipeline. 

According to the company, early users are experiencing significant business benefits by improving the checkout experience through the use of local payment methods, and dynamically routing transactions to a wide range of processors across 200+ countries, resulting in cost savings and higher authorisation rates. Payrails is specifically designed for multi-party platforms, streamlining marketplace payments and automating all financial operations within a unified solution.

EQT Ventures and the US investor General Catalyst, renowned investors in groundbreaking companies, have joined as new backers, further validating Payrails’ potential to become an industry-shaping company in the FinTech space. This round also includes Andreessen Horowitz, a prominent US investor in iconic tech companies, and HV Capital, demonstrating their continued confidence amid a challenging market and doubling down on their investment in Payrails.

Kaushik Subramanian, Partner at EQT Ventures, says: Enterprise customers require a high quality, reliable payments product that can manage complex money flows, increasingly in a multiprocessor environment. To build a scalable product for this is akin to building the SAP of payments. This requires both depth and experience in building similar products, and this is why the Payrails team is ideally positioned to tackle this challenge – the positive feedback from their live customers is a testament to this. We are passionate about payments and teams that are building generation-defining solutions. Payrails addresses one of the major challenges in payments, and we look forward to being part of Payrails’ journey.”

Zeynep Yavuz, Partner at General Catalyst, adds: “As digital marketplaces became more global, payment processes have also expanded. Previously, global marketplaces had no choice but to build in-house payment systems or combine different solutions as they scaled into new markets, both of which required significant resources to manage payment processes. With Payrails, companies will gain access to a full-stack platform that we believe addresses the entire payment value chain. The experience of the Payrails team, their early success with enterprise customers, and their partnership approach stood out to us, and we look forward to helping Payrails build a category defining payments company for the enterprise sector and beyond.”

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Stefano De Marzo
Stefano De Marzo
Stefano De Marzo is the Head of News at EU-Startups. He has been extensively covering startups, venture capital and innovation ecosystems, including contributions to numerous publications such as Sifted, Entrepreneur and Forbes. Through his work as an editor and writer, he continues to shape the narrative surrounding the best stories of the tech world.
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