Buy Now, Pay Later Company Nelo Raises $100M From Victory Park Capital

In the midst of macroeconomic uncertainty that is being experienced globally, which has impacted the financing received by financial technology companies in the world, And that onea firm focused on consumer loans under the ‘buy now, pay later’ model, announced that it had obtained a loan for 100 million dollars granted by Victory Park Capital.

In an interview, Nelo executives indicated that this financing was achieved thanks to the performance that the company has had in recent months, as well as the market perspective that exists in Mexico, where the firm has managed to overcome effects such as inflation and even the rise of interest rates.

“It is a line of debt to grow the amount of our loans. We are a lender and it is very important that companies like us have surveys like this, because we need to use the debt to fund our loans,” said Kyle Miller, co-founder and CEO of Nelo.

According to Miller, Victory Park Capital considered three important points to allocate this amount to Nelo: “The market opportunity in Mexico in terms of credit, where many people seek access; the performance of the loans, since we are now profitable and the team made up of 36 people of eight different nationalities”.

For Miller, the company’s priority is to satisfy the needs of Mexican consumers, so with these steps that Nelo has taken, with the promotion of more than 3 million purchases to date, the company is on its way to being a new unicorn and have a valuation of more than 1,000 million dollars.

draw effects

Although the macroeconomic environment has put pressure on some technology companies dedicated to financial services, for Nelo this issue has been a boost as consumers seek, in the current context, financing options such as the ones it offers to meet their needs.

“Inflation and the rise in interest rates have been two factors that play an important role for us: these issues make products like ours attractive. In terms of rate hikes, we have tried to hold out so as not to transfer these increases to the final consumer. , we have achieved it and we believe that we will be able to continue doing so in the medium term,” said Alejandro Villalobos, Vice President of Finance and Partnerships at Nelo.

Villalobos explained that the reason for financing through debt, and not raising capital, is because the first mechanism is more efficient at the time Nelo lives. “Raising capital and using your own capital to lend is too expensive, that’s why from a financial strategy perspective, it makes a lot more sense for us to raise debt… That doesn’t rule out that in the future we may seek a raise capital”.

Through the Nelo application, its users can pay in installments at any online store. For its part, Victory Park Capital is a firm specialized in alternative investments that provides capital to emerging companies, both in the United States and abroad.

“Through its ‘app-first’ strategy, Nelo has successfully differentiated itself from its competitors and we believe the company is well-positioned for growth,” said Jason Brown, Partner at Victory Park Capital.