Tallinn-based Montonio raises €2.5 million to become Europe’s checkout solution

Estonian startup Montonio, a new ‘one-stop-shop’ for online businesses looking to take their e-commerce sales to the next level, has just raised €2.5 million from current and former executives from Bolt, Wise and Pipedrive, and VC funds.

Founded in 2018, the company has built a unique financing solution that lets the customer obtain ’buy now pay later’ (BNPL) offers from multiple lenders in real-time, compare them, and sign the one they find most suitable. Compared to the large BNPL players on the market, like Klarna, the solution decreases the credit costs for the customer by up to 50%, while significantly increasing the conversion rates for the merchant.

“BNPL has been available in the Baltics for over a decade and recent years have seen many new competitors enter the market. They all look the same to the consumer, offering similar terms, and often at checkout they only get one offer, even if technically a cheaper option is available. Montonio takes on the role of the consumer advocate — our product aggregates the offers and helps the buyers pick the best option,” explained Markus Lember, the CEO of Montonio.

The company has partnered with more than 1,300 ecommerce merchants across the Baltic states and other European countries. “We are seeing BNPL and open banking start-ups reach historically high valuations and record round sizes – our own financing round was nearly 3x oversubscribed”, commented Lember. “Our rapid growth has validated the hypothesis that we can grow organically and without relying too much on investor funding.”

Apart from financing, the company has developed an e-commerce payment solution based on open banking that can cut costs up to 100x in comparison to traditional card payment schemes like Visa and Mastercard. The solution is already used by a quarter of Estonia’s population in just the first half of 2021 alone.

“Montonio has quickly become the market leader for e-commerce checkout providers in the region. They are able to provide a full range of checkout products and that’s what makes them so attractive for merchants” said Markus Villig, CEO of Bolt, who invested in this round.

The €2.5 million seed round was led by Tera Ventures, with participation from US-Poland ffVC, and other VC firms. Several business angels participated in the round, including Bolt’s CEO Markus Villig, Bolt’s first investor Mikko Silventola, former Pipedrive executives Sven Kirsimäe (current CTO of Rendin) and Kair Käsper (current co-founder of Klaus), Wise’s former heads of operations Triin Hertmann (current co-founder of Grünfin) and Martin Sokk (current co-founder of Lightyear) just to name a few.

The investment will be used to expand into new markets across the EU and to gain market share in their existing markets.