Paddle, the e-commerce platform for software businesses, just closed a Series A funding round of $3.2 million, led by BGF Ventures with participation from Spring Partners.
The London-based startup was founded to solve the problems of selling internationally. Paddle helps its customers by handling sales tax and supporting a range of payment methods, including all major credit cards and PayPal, in addition to fraud prevention and checkout recovery. While reducing burden for sellers, Paddle increases seller revenues through analytics and customer feedback.
Christian Owens, Paddle’s founder explains: “As a developer myself, I didn’t want to have to deal with all of these distractions, I just wanted to build software. We know that this is a common problem for software businesses. We created Paddle to give them the tools they need so that they can have a first-class eCommerce operation and concentrate their efforts on making great products.”
Owens, who founded Paddle in 2012, is a 2016 Thiel Fellow – the only one in the UK – and started his first business aged 14. The London-based Paddle team of 16 has an average age of 27 and draws on experience from companies including Greenhill and PwC. The company’s first backers were Mark Pearson, founder of MyVoucherCodes, and Mark Evans.
According to the young company, Paddle has grown at 350-400% a year for the last three years. The priority following this new investment will be to invest in engineering and customer support to maintain that growth. There are currently around 400 businesses using Paddle, processing around one million transactions every year.
Paddle’s customers are small and medium sized software businesses with revenues of up to around $20 million per year. Combined these businesses have revenues of well over $10 billion per year and are not really targeted by other e-commerce platforms.
Paddle founer Owens stated: “We haven’t done any marketing at all so far. Our growth to date has been from referrals, word of mouth and a small sales team. We’re hoping to scale up our sales and marketing efforts with this funding.”