The deal gives SumUp access to over 70 million consumer members and 12,000 small business members in the US within Fivestars' community
SumUp, a UK-based payments service provider, has agreed to acquire Fivestars, an American payments and marketing platform, for $317m in a cash-cum-stock deal.
Fivestars is a local commerce platform in the US that is claimed to drive more than $3bn of sales and 100 million transactions per year.
Founded in 2011, the company provides vertically integrated payments, loyalty, as well as a marketing automation platform.
Fivestars is supported by investors such as Lightspeed, Menlo Ventures, DCM, Salt Partners, HarbourVest, and Y-Combinator among others.
SumUp is claimed to be one of the largest payment processors in Europe for small businesses. It has a network of more than three million merchants in 34 markets.
The UK-based firm said that the acquisition will allow both firms to provide marketing automation and payments services to small business owners throughout the US and globally.
The deal marks the first acquisition for SumUp in the US and will give it access to over 70 million consumer members along with 12,000 small business members within Fivestars’ community.
SumUp said that the acquisition will mean increased technology offerings for small-sized businesses in the US, which will allow them to save money on payments and generate revenue by using smart automated marketing.
SumUp co-founder Marc-Alexander Christ said: “SumUp is a market leader because of our support for, and belief in, small businesses. Our global community of merchants has battled through lockdowns and volatility and we’re confident that this acquisition will further energize the U.S.’s recovering small business economy.
“Now is the time to make sure our presence is as strong in the U.S. as it is in Europe and, by acquiring Fivestars, SumUp will deliver for U.S.-based merchants as it has in other international markets.”
Fivestars’ team based in San Francisco, which comprises its co-founder and CEO, Victor Ho, and others will continue in their existing roles to run the business.
Victor Ho said: “We founded Fivestars to give small businesses the opportunity to thrive in the digital economy and over the years, we’ve achieved just that.
“Understanding that SumUp shares this mission, it was an easy decision to partner, and together, we look forward to supporting a retail market that champions small business success.”
The acquisition of the US firm follows an amount of €750m raised in March 2021 by Fivestars in the form of debt provided by Goldman Sachs, Bain Capital Credit, Temasek, and others.