▼ Summary
– Flatpay has become a European fintech unicorn valued at €1.5 billion ($1.75 billion) by focusing on small merchants with a flat transaction rate model for card payments.
– The startup grew from 7,000 to 60,000 customers in under a year, targeting the segment that makes up 99% of European businesses.
– Flatpay reached €100 million in annual recurring revenue (ARR) in October 2024, with plans to grow 300% to €400-500 million ARR by 2026.
– It raised €145 million ($169 million) in its latest funding round to support expansion in current markets and entry into new ones, while planning to double its staff to 3,000 by the end of 2025.
– The company uses a hands-on, in-person sales approach with instant demos and 24/7 support, differentiating itself by offering simplicity and gradual adoption of services like AI features and a banking suite.
Achieving a valuation exceeding one billion dollars, the Danish financial technology firm FlatPay has officially become Europe’s newest unicorn. This milestone underscores the company’s rapid ascent within the competitive payments sector, where it focuses on providing straightforward card payment solutions for small and medium-sized businesses. By offering a simple flat transaction rate for its card terminals and point-of-sale systems, FlatPay has positioned itself as a compelling alternative to larger, more complex providers.
The startup’s strategy of targeting a market segment that represents the vast majority of European enterprises has fueled impressive growth. Its customer base has skyrocketed from just 7,000 in April 2024 to approximately 60,000 merchants today. This expansion is mirrored in its financial trajectory, with the company now valued at €1.5 billion. Co-founder and CEO Sander Janca-Jensen emphasizes that while the unicorn status is significant, his primary focus is on annual recurring revenue (ARR). The company recently surpassed €100 million in ARR and is reportedly adding close to €1 million to that figure every single day. Janca-Jensen has set an ambitious target to grow ARR by another 300% by 2026, aiming to reach between €400 and €500 million.
To fuel this aggressive expansion plan, FlatPay has secured €145 million in its most recent funding round. The investment was led by AVP Growth and Smash Capital, with continued participation from Dawn Capital. Notably, German footballer Mario Götze also contributed as an investor in a prior round. The new capital will be used to deepen the company’s presence in its existing markets, Denmark, Finland, France, Germany, Italy, and the U.K., and to support entry into one or two additional European countries next year. Although Janca-Jensen has not specified the target markets, job listings suggest the Netherlands could be next on the list.
A key component of FlatPay’s growth strategy is its substantial investment in human resources. The company currently employs 1,500 people, whom it refers to internally as “flatpayers,” and intends to double that number by the end of the next year. This commitment to headcount growth is considered as vital as revenue growth, with the firm publicly stating its goal to achieve a tenfold increase in both by 2029. This people-centric approach is directly tied to its unique sales model, which relies on in-person customer onboarding. Sales representatives physically visit potential clients with demonstration kits, including card terminals, to provide instant, hands-on explanations of their services.
This high-touch, personal method is central to FlatPay’s hypothesis that small business owners are actively seeking better solutions, even if they are already using a payment system. The company believes that by literally “coming in the door” with a clear, simple offer, it can effectively capture market share from both legacy providers and other fintech giants like PayPal and Stripe. While this model results in customer acquisition costs that are higher than the industry average, Janca-Jensen argues that it creates its own demand, enabling a growth rate that would otherwise be unattainable. This triple-digit growth makes the substantial investment in a large sales and support team more justifiable to investors, even in a market climate often dominated by discussions of automation and artificial intelligence.
Despite its focus on human interaction, FlatPay is not ignoring technological advancements. The company utilizes AI for certain real-time features and is experimenting with voice AI agents for customer service. Looking ahead, FlatPay plans to expand its product suite further into financial services, with the development of a banking package that would include business cards and accounts. For Janca-Jensen, the philosophy is one of gradual, manageable adoption, ensuring that small business owners are not overwhelmed but can instead “eat the elephant one bite at a time.”
(Source: TechCrunch)
