Finix is making waves in the payment processing arena, announcing a robust $75 million fundraising round aimed at taking on industry giant Stripe. After years of establishing itself by helping businesses set up their internal payment systems, Finix officially became a payment processor in 2023, positioning itself for a significant competitive push.
In an exclusive interview with TechCrunch, CEO and founder Richie Serna described the shift to becoming a payment processor as “hugely transformational” for the company. He revealed that Finix has quadrupled its revenue over the past year, though he didn’t disclose the exact number of merchants currently using the platform. However, Serna previously indicated that Finix was supporting over 12,000 merchants and noted that 2024 has already seen more deals closed than in the company’s entire history, suggesting they may now exceed 24,000 merchants.
Despite this growth, Finix still has a long way to go to match Stripe’s customer base. Notably, Sequoia Capital, which initially led Finix’s $35 million Series B round in 2020, later withdrew its support due to a conflict of interest with Stripe. However, Serna believes that this incident ultimately put Finix on the map and has not hindered their growth.
“The narrative that Stripe owns the entire market is misleading,” Serna argued. “In reality, Stripe controls only 6% of the U.S. market and less than 2% globally. Payments remain a fragmented landscape, with about 91% of transactions still routed through systems built decades ago.”
So, why would businesses choose Finix over Stripe? Serna emphasizes that while both companies now process payments and require minimal coding for setup, Finix is focused on catering specifically to businesses with both online and in-store operations that lack the resources to develop custom solutions. Finix offers a wider array of options for physical payments and integrates seamlessly with various payment devices.
Additionally, Finix promotes transparency in its pricing structure. While Stripe takes a standard 2.9% cut plus a 30-cent fee per transaction, Finix operates on a cost-plus model, clearly breaking down charges and showing customers their markup.
With the new investment, Finix plans to expand its team beyond the current 130 employees and explore international markets. The startup aims to carve out a more substantial share of the U.S. payments ecosystem.
This $75 million Series C round was spearheaded by Acrew Capital, with participation from Leap Global, Lightspeed Venture Partners, and others, bringing Finix’s total funding to $208 million.
As Finix gears up for its next phase, it appears poised to challenge the status quo in the payment processing industry and capture a larger slice of the market.
