Paidy: A Japanese Fintech Unicorn
| Case Code: LDEN186 Case Length: 9 Pages Period: 2004-2021 Pub Date: 2022 Teaching Note: Available |
Price: Rs.400 Organization : Paidy Industry :Financial Services Countries : Japan Themes: FinTech, Platform Ecosystem, Business Models,Product, Service Value |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Genesis of Paidy
Russell was born in Singapore and grew up in Canada and Hong Kong. After receiving a graduate degree from a university in London, Russell transformed himself into a finance wizard with a Master’s degree from Stanford University. Following this, he started working with Goldman Sachs in Tokyo as a credit trader. During his time at Goldman Sachs, Japan Russell gained an understanding of the changing consumer lending landscape in Japan..
Growth Through Investments and New Services
In July 2016, the company raised US$15 million in a Series B round of funding. Eight Roads Ventures (the investment arm of Fidelity), SBI Holdings, and SBI’s FinTech Business Innovation, led the round. Thereafter, Paidy raised US$55 million in a Series C round of funding in July 2018..
Challenges
Although Paidy was available at 600,000 online stores in Japan as of December 2021, including those of Adidas and Dean and Deluca, it faced several challenges. Though the majority of Japanese had a credit card, cards were only used 60% of the time for online payments. Cash-on-delivery and convenience store payments were still popular among online shoppers..
Future Outlook
According to research published in mid-2021 by the Japan Research Institute, Paidy was one of the largest BNPL operators in Japan, though the market was smaller than in Europe, the US, or Australia. According to Yano Research Institute, Japan’s BNPL market had US$11 billion in transactions in the fiscal year ending March, 2021..
Exhibits
Exhibit I: BNPL Business
Exhibit II: Digital Payments Overview in Japan
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