September 19, 2015
Lightspeed POS, a fast growing startup headquartered in Canada that has helped more than 25,000 businesses sell and manage their inventory via their cutting edge POS system, raised $61 million in its Series C round of funding. In the company’s recent blog, Dax Dasilva, the Founder and CEO of Lightspeed talked about investing this amount in building and scaling their infrastructure, expanding their e-commerce offerings and growing their global presence and customer base. Lightspeed acquired POSIOS in 2014 and Merchant OS in 2013. After this funding, the company plans to make more acquisitions and grow their sales via multiple channels.
The Series C round of funding was led by Caisse de dépôt et placement du Québec (CDPQ) and Investissement Québec (IQ) and supported by its previous investors, Accel Partners and iNovia Capital. With the recent funding of $61 million, Lightspeed POS has raised a total of $126 million since 2012. It raised $30 million in the Series A funding round and $35 million in Series B. Accel Partners and iNovia Capital led both the funding rounds.
In a discussion with TechCrunch around this news, Dax Dasilva said, There is a big change in the industry and POS systems. They are becoming a center of interest because of the changes in regulation around the world, for example, because of EMV payments in the U.S. The offline and online worlds are merging, and so new cloud systems are combining to bring the best of both.
The POS industry in the US and everywhere else is growing rapidly. Square, a leading POS provider has already announced its IPO for Q4 for 2015 and it may appear in the public listing next month. Shopify, another POS provider went public earlier this year. However, Lightspeed is still on its way to announce public listing or may be not.
In the same discussion with TechCrunch, Dasilva said, I think that the goal over the next couple of years is to prepare for the optionality of going public or getting even larger staying private. We are putting everything in place so that the company has lots of options,
Lightspeed’s latest round of substantial capital infusion should be seen in the context of how the retail POS space has evolved in recent years. There has been a slow yet sure revolution in the POS space since newer technology players started paying attention to retail payments about 5 years ago. While the initial focus was around mobile POS and supporting mobile payments, the recent EMV migration mandata has infused a new burst of energy into the real growth prospects for POS players and the adjacent stakeholders. Despite retail being a decades old industry with a relatively low velocity of innovation historically, the past decade has seen a multitude of factors play an important role in the need for investment in new capabilities at POS: NFC / contactless, EMV, value added services like coupons/offers, split tender for loyalty, P2PE (point to point encryption) are some key new technology drivers. In addition, the increasing complexity from these new technologies, many of which have been evolving slowly over the years, has resulted in an increasing focus on security especially with the recent data breaches at US retailers with very visible negative media coverage.