U.S. Tech Billionaire Ventures Into U.K.'s Buy Now, Pay Later Market

Company Overview - Affirm, a fintech company founded by Max Levchin, has expanded its services to the UK, marking its first venture outside the US and Canada [1] - The company offers credit to consumers, allowing them to split purchases into multiple payments without charging late fees [1] - Affirm had over 18.7 million active customers in North America, with gross merchandise volume exceeding $26.6 billion in 2023 [4] - The company's merchant partners include major retailers such as Amazon, Shopify, and Walmart [4] Financial Performance - Affirm's revenues increased by 46$2.3 billion in the year through June 2024, while its net loss narrowed to $518 million [5] - The company aims to achieve operating profitability on a GAAP basis by the fiscal fourth quarter of 2025 [5] - Since its Nasdaq listing in January 2021, Affirm's market cap has declined from$24 billion to $13.5 billion due to a share price slide [5] Business Model and Strategy - Affirm underwrites every transaction and makes real-time credit decisions, approving consumers only after verifying their ability to pay [3] - The company offers both interest-free and interest-bearing monthly payment options in the UK, with interest charges that do not compound over time [3] - Affirm's mission is to build honest financial products, leveraging its leadership in the US and Canada to expand into new markets [4] Industry Context - The buy now, pay later (BNPL) industry in the UK has faced scrutiny, with nearly a quarter of shoppers incurring late fees in 2023 [2] - The UK government is working on new regulations to protect consumers in the BNPL sector [2] Leadership and Background - Max Levchin, co-founder and CEO of Affirm, previously co-founded PayPal and has been involved in other ventures such as Yelp, Slide, and Glow [5] - Affirm was co-founded in 2012 by Levchin, Nathan Gettings, Jeff Kaditz, and Alex Rampell [5]