©2020 AEA3 WEB
Image default
IT

This UK fintech startup looks to cash in on ‘buy now, pay later’ model, secures £1.35M

Purple Dot, a London-based fintech startup provides a plug-in for websites that allows customers to request the retailer drop the price of an item by anything between 10 to 20%, which the company called as ‘worth-the-wait’ payment option. This financing option enables both parties to make a clear, informed decision on the sale. 

Raised £1.35 million funding

Recently, the Purple Dot raised £1.35 million seed funding led by Connect Ventures, with support from AI Seed, Moxxie Ventures, Andy Chung and Philipp Moehring from AngelList, Vijay Pandurangan (ex-Twitter), Alex Roetter former SVP of Engineering at Twitter, and the family office of Paul Forster, co-founder of Indeed.com.

Madeline Parra, CEO of Purple Dot, commented: “When shopping online today, customers can either pay the retail price or walk away. When they do walk away, the item goes through the discounting process, becomes unprofitable for the merchant, and is resigned to landfill. This binary system isn’t working for anyone – the customer loses out on the item, because it may go out of stock in their size before they attempt to purchase it again, and the merchant loses the sale. Purple Dot tackles this problem head-on by providing a new way to shop, taking on unsustainable, unrelenting consumerism, poor pricing tactics, and profit-crunching sales at the same time.”

Buy now, pay later

Similar to Klarna or Clearpay, Purple Dot aims to help fashion brands tackle wasted inventory, drastic sales tactics, and the profit erosion that comes with it. 

Unlike other financing options, which lets customers pay upfront, the Purple Dot offers a ‘buy now, pay later’ option, thereby not dragging consumers into unsustainable debt. 

Right now, the company is working with various small boutiques across the country and is currently in discussions with several major UK and US high street brands. 

SPOKE to partner with Purple Dot

The first major brand to partner with Purple Dot will be menswear retailer SPOKE and is expected to go live in the upcoming days. Notably, SPOKE will use Purple Dot to pre-order and then sell their line of ‘Beta’ clothing. 

In general, this pre-order feature will help brands better manage inventory and production levels, with increased visibility on sales-levels ahead of a season, claims the company. 

Help reduce losses during the end of season discounting

From the retailer’s point of view, the Purple Dot model allows them to choose to sell their products at a reduced price mid-season, rather than being forced into panic sales at the end of it. 

As per the company claims, the full price remains in play all season, they never need to strike it through, it maintains the value to the consumer of getting the item immediately. 

By giving the brand visibility on the list of ‘worth-the-wait’ shoppers vs full-price sell-through, the brand can make an informed decision on how much of their inventory to sell at the ‘worth-the-wait’ price.  

Further, the ‘worth-the-wait’ price does not fall below a 10-20% reduction from the recommended retail price (RRP), helping retailers reduce losses from the end of season discounting. 

Founded in August 2019 by senior Skyscanner employees Madeline Parra (CEO) and John Talbott (CTO), Purple Dot is backed by Connect Ventures, AI Seed, Moxie Ventures as well as prominent angel investors. 

Pietro Bezza, General Partner at Connect Ventures, commented: “For Connect Ventures our investment in Purple Dot extends our thesis of investing in teams who leverage software and a product-first approach to solving real-world problems. Purple Dot’s innovative proposition benefits retailers by creating a solution to their inventory problems. End of season ‘panic sales’ have long caused financial uncertainty for retailers and a negative impact on the environment in equal measure. We’re very proud to have partnered with Madeline and John in their mission to change the way we shop and to rewrite the rules of retail.”

The post This UK fintech startup looks to cash in on ‘buy now, pay later’ model, secures £1.35M appeared first on UKTN (UK Tech News).

Related posts

Trump supporters targeted by cryptocurrency scammers

AEA3

D&I push should come from the top, says panel

AEA3

Chip raises £10.7m Series A

AEA3

Your ads here. Click here