Paystand, the leader in blockchain-enabled accounts receivable and B2B payments, today announced the acquisition of Yaydoo, the leader in accounts payable, cash flow management, and liquidity solutions in Mexico and LATAM. The deal represents one of the biggest technology unions in Mexico and LATAM and makes commercial blockchain-based solutions more accessible across the Americas.
In the midst of economic uncertainty, the fusion of the two firms opens a horizon of hope and opportunity, not only for other tech startups but also for Latin American businesses. Both PayStand and Yaydoo offer a wide range of technology-enabled B2B solutions for automating transactions, payment, and bill collection processes.
The two companies have built best-in-class AR/AP solutions designed for the needs of both U.S. and LATAM businesses of all sizes. They have succeeded in creating B2B DeFi payment networks in both the U.S. and Mexico, creating a network effect, and now set their sights on connecting their platforms through a single, open, instant and secure global payment network.
Jeremy Almond, CEO of PayStand, comments: “Together, PayStand and Yaydoo will redefine the boundaries of B2B fintech across the continent. The combined company will be one of the first global B2B blockchain platforms at a significant scale. The resulting company will have processed over $5 billion in payments, added 300 additional employees, and built a network of over 500,000 connected businesses, the largest of any commercial B2B blockchains in the world.”
Almond continued, “DeFi-enabled B2B payment networks that are on-chain can unlock transformative working capital efficiencies and make financial services more fair and open, especially in developing markets like LATAM. And we believe this industry disruption across borders and using DeFi blockchain can shift the balance of power from traditional financial institutions and governments to buyers, and sellers, benefitting business and society.”
Traditional Payment Sector Slowing the Economy
In the U.S., persistent inflation and higher interest rates have made working capital more important and ever more difficult to come by. As CFOs hunt for more cash, they increasingly look to technology to achieve greater economies in the mission-critical cash cycle.
According to Deloitte, nearly 50% of the $18 trillion in commercial payments in the U.S. are still paper checks, and the vast majority of the rest are still performed through a manual or pre-internet process. Automation using Web3 technologies across AR, AP, expense, procurement, and payments in a unified platform offers huge cash advantages to enterprises, helping the U.S. B2B payment market to hit a projected CAGR of more than 8% over the next five years.
Meanwhile, the global B2B payments market reached a value of $940 billion in 2021 according to Goldman Sachs, and AR/AP software accounted for $130 billion of the total market size. Though this existing market size is significant, it only accounts for the companies that are already using software or digital AR/AP solutions. In LATAM, less than 5% percent of companies are digitized, implying that the B2B payments opportunity in places like Mexico and other emerging markets offers a much larger green field.
“Yaydoo and Paystand have enabled B2B payment networks through their AR/AP software landscape. Now it’s time to join forces and deliver solutions that will simplify and digitalize trade among the U.S. and Mexico, unlocking a set of opportunities for automating supply chain finance through the imports and exports of one of the most active trade corridors globally,” said Sergio Almaguer, CEO of Yaydoo.
“Connecting the U.S. and Mexico is only the first step. We understand very well that each country has its own payables and receivables solutions enabling B2B payments locally. We want to forge long-time alliances with all these organizations that already know their market in order to build a network that embraces the entire continent,” concluded Sergio, who will continue leading the Latin American expansion of the combined company.
This fusion at a time of economic uncertainty demonstrates the impact and growth potential of Latin American solutions such as Yaydoo. This is the first step of a bold roadmap the company is already executing.
The combined organization creates high-return synergies including access to new markets, product offerings, distribution channels, and talent. In the Americas, the combined company will have the capacity to expand from the U.S. to Canada, and from Mexico to Colombia, where Paystand’s and Yaydoo’s products can be distributed through existing channels and integration partners. Currently, the companies have already integrated globally with Oracle NetSuite, Sage Intacct, Xero, and with CONTPAQi in Mexico, enabling access to the largest and most sophisticated mid-market opportunity on the continent.
“This is a watershed moment for both companies, the B2B payments ecosystem as a whole, and for the blossoming Latin America tech ecosystem in particular,” said Roman Leal, Managing Partner of LEAP Global Partners. “Equally exciting for small and medium enterprises (‘SMEs’) across the Americas, PayStand now represents the largest enterprise application leveraging blockchain technology to reduce the cost of digital payments and accelerate the time to cash. We believe this value proposition will resonate even more in this increasingly uncertain economic environment.”
There is a significant market opportunity in front of Paystand and Yaydoo. With its scale the combined company could be on a path to an Initial Public Offering (“IPO”) in the next two years, re-opening IPO capital access to the tech sector that is struggling in a recession-prone environment.
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