Italian unicorn Satispay eyes European fintech crown | fDi Intelligence – Your source for information on foreign direct investment

As consumers have steadily moved away from cash in major economies around the world, a number of new payment services have been launched by start-ups, major technology companies and established banks.

Among them is Satispay, a Milan-based fintech that operates a payment network independent of debit and credit cards. Alberto Dalmasso, who founded Satispay together with Dario Brignone and Samuele Pinta back in 2013, tells fDi that Italy has a “very fragmented” banking sector and believes it lags behind other European countries in terms of the availability of high-quality financial services.

“You are not at the same level in a country like Italy, so there is a strong entrepreneurial drive to create [financial] products that can greatly simplify the lives of citizens, merchants and businesses,” says Dalmasso, who also serves as Satispay’s CEO.

While the technology sector is undergoing a major correction, with layoffs and falling company valuations and investments, Satispay is pursuing growth in Italy and abroad. In September 2022, the company became Italy’s second ‘unicorn’, or startup worth more than €1bn, after raising €320m from a group of notable international investors, including Lee Fixel’s New York-based venture capital (VC) fund Addition.

“Our goal is to become the largest fintech company in Europe,” says Dalmasso, adding that this capital infusion finally gives Satispay the resources needed to pursue its growth strategy.

Satispay is already the dominant mobile payment solution in Italy, with three million consumers and 200,000 merchants on its platform, but has so far gained less traction in international markets. Over the next 18 months, Satispay will expand its network at home and in France, Germany and Luxembourg, and double its workforce from 300 to 600 people.

While this development will be challenging in the crowded payments space, experts believe that Satispay is well positioned to become one of Italy’s first pan-European fintech successes.

Payment growth

“Despite inevitably increasing competition, Satispay operates in a growing industry,” said Francesco Burelli, a partner at Arkwright Consulting, which tracks the payments industry.

Consulting firm PwC estimates that the number of global cashless payments will almost triple by 2030. In Europe alone, there are expected to be 522 billion cashless transactions per year, about 17% of the global total.

“We’re still in the early days of fintech in Europe,” says Ines Verschueren, a partner at Greyhound Capital, a London-based VC firm that first invested in Satispay in 2018. While many tech companies have had to pivot, Verschueren says that Satispay is a “prime example” of an everyday product that consumers will continue to use regardless of the economic environment.

“People still have to pay their friends, pay bills and shop in stores,” she says, adding that Satispay has the advantage of giving merchants a cheaper solution than traditional card payments.

In its aim to become Europe’s biggest fintech, Satispay hopes the prepaid accounts it offers, which boast a combination of features including peer-to-peer transfers and bill payments, will find success in markets across the continent.

City by city

Dalmasso says Satispay will take a “city-by-city” approach to expansion in Europe: “You really have to be very careful where you go and not spread too much of your efforts, otherwise you won’t see any results. .”

Instead of pursuing aggressive growth and trying to “conquer” large urban areas, Satispay is experimenting in smaller settings to perfect its model. To enter France, Satispay first experimented in Metz, a city of about 120,000 people near the Luxembourg office, and Menton, a city on the French Riviera near the Italian border.

After seeing “impressive” results in these two cities, Satispay has already defined its next steps for expansion from the French Riviera to Lyon and then eventually Paris. The platform is also available in Luxembourg, where Satispay’s electronic money institution is based, and is being trialled in Nuremberg, Germany.

“We’re doing what we did in Italy, but there’s always something to tweak and improve to get into a new geography,” says Dalmasso.

Crowded space

Satispay offers before they approach European markets where there are already established mobile payment players, such as Swish in Sweden, Vipps Mobilepay in Norway and Bizum in Spain.

You have to “spend more on explaining the difference” between platforms in these markets, says Dalmasso. “It is very important to always prioritize, strengthen your network and then go into the most difficult geographies with bigger muscles.”

Mr Burelli notes that for Satispay to achieve a similar position in other markets outside Italy is “highly dependent on its success in achieving critical mass adoption” by customers.

“The mobile payment race is quite crowded and often outgunned by value propositions with similar features, it can prove more challenging to differentiate and achieve customer preferences in such a context,” he explains.

Milan base

Satispay’s growth plans are also in line with Italy, proving they can catch up with their peers on the European startup stage. Relative to its gross domestic product in 2021, Italy attracted just over a tenth of the amount of VC funding seen in France and Germany, according to fDi calculations using PitchBook and World Bank data.

Dalmasso says that while Italy lacks talent with experience in scaling businesses up to millions of users, as in other European tech hubs and Silicon Valley, the “right environment” is being created for “Italy to scale, train great talent and get bigger investments” .

This conviction is evident in Satispay’s plan to open a new sustainable headquarters in Milan, which will have 8,500 square meters of space over eight floors. Dalmasso, who is keen on personal collaboration and Satispay employees working together at least three days a week, says these headquarters will be key to attracting top talent to Italy.

He adds that Satispay also established an office in Berlin back in 2020 where “there’s a lot of talent you can pull from other marketplaces,” such as food delivery platforms. As Satispay attempts to turbocharge its growth, Dalmasso is convinced that the current gloomy market conditions will work in the fintech’s favour.

“Hiring the best talent is the most important thing that will determine our success,” he says. “Right now we’re seeing even the best talent looking around because they want to be part of a team that will grow and not be cut over the next few months.”

This article first appeared in the December 2022/January 2023 print edition fDi Intelligence. See a digital edition of the magazine here.