The UK-based Zilch, a leading buy now pay later (BNPL) service provider, has seen its fortunes grow immensely over the last year. Founded in 2018, the company has now become one of the hottest businesses in its space. This rise has helped the company draw comparisons to Klarna and Amex and has provoked increasing buzz identifying it as the next fintech unicorn. This impressive ascendence has, in part, been fueled by the global shift in online buying due to lockdown measures. Read on for a look at the company’s rise and how it provides value to its users.
Zilch Growth Rate Takes Off
One thing that has stood out about the growth rate of the BNPL provider has been its accelerated nature. Although the quality and innovation showcased by the company’s offerings have singled it out as a service to watch right from its start, it usually takes quite a while for even the most successful firms to accrue a sizable user base. Not so for the BNPL provider, however. The fintech unicorn brought in almost half a million users in its first year of operation in 2018, with a growth rate now reaching 125,000 per month.
This rate, while of course welcome, has also prompted the company to accelerate internal plans for growth. According to the company’s CEO, Philip Belamant, this has been an exciting process, one that has underscored the demand for the firm’s services.
“We expected to be five to six times less [in size] at this point,” noted Belamant when recently speaking to the press.
That expectation, however, has not hindered the company’s ability to rapidly scale up. Taking its extreme growth rate in stride, the BNPL provider has been working tirelessly to grow its services alongside its users with app capacity and server support keeping pace with its expanding customer base.
With the company’s growing base of dedicated users has also come the necessity of adding more employees. One needs only look to the company’s employment plans at this time last year to see just how much its growth has accelerated. At that time, the organization employed 12 staff members and was seeking to add three more — a sizable increase for a company just finding its footing in the world. However, that modest rate of growth was soon destined to be surpassed due to the manner in which the general public began to respond to the services offered by Zilch.
The company soon found that users were flocking to its offerings and it needed more employees to keep pace. Hiring increased many times over and by the end of 2020, the company employed 85 individuals. It is now seeking to add another 100 staff members, cementing a rarified expansion.
This expansion has also changed much about the actual manner in which the company’s employees engage in their work. A year ago, much of that work was conducted out of a branch of the popular co-working space — WeWork. While amenities were adequate at the time, the distractions present in the unfocused environment also served as a worry for the team. Though lockdown restrictions have since moved the majority of the company’s efforts to remote, some of that work is now starting to move back to an in-person environment. The company is still deciding what that in-person culture will entail — perhaps a hybrid model — but it’s clear already that it has now outgrown its early days operating as a 12-person startup in a WeWork.
Zilch Stands Out For Consumers
When one looks at the impressive rise exhibited by Zilch, it’s inevitable to question which details of its offerings have helped it get ahead in the crowded BNPL space. One of the answers here centers on the way in which it listens to the needs of consumers and what they’re seeking from a BNPL provider. Here again, insights from the company’s CEO are illuminating.
“In the future people will not own so much,” says Belamant. “This is just the beginning of that.”
Those comments came amidst a discussion about how the nature of consumerism is changing. Rather than ownership being the gold standard of the purchasing model, the CEO forecasts that subscription services will become increasingly normalized. With this model already firmly adopted for items such as phones and cars, the executive’s words seem prescient, helping to explain much about how his company approaches its offerings.
In addition to its subscription model, the company has also scored points with consumers by offering them the ability to make purchases online wherever Mastercard is accepted. This stands in contrast to a model, adopted by others, that requires users to restrict their shopping habits exclusively to partner retailers. By providing this high level of flexibility and freedom, the BNPL service has stood out as a choice for millennial users seeking a smarter way to make online purchases.
Working With Regulators
Another thing that has helped the BNPL company keep its future outlook and valuation high has been the way in which it has worked with regulators in the UK to ensure its offerings are in line with their expectations. This has become of particular importance of late as the Financial Conduct Authority (FCA) has recently announced that it will be increasing regulations with respect to the BNPL sector.
While this has been a cause of concern for other firms, many of whom are scrambling to accommodate the coming oversight, this consideration has been built into the business model of Zilch from the start. This has been accomplished by developing its offerings through the FCA’s regulatory sandbox which allows organizations offering innovative financial services to work alongside regulators and actual consumers in order to ensure a quality offering.
With the above considerations in mind, it’s perhaps unsurprising that Zilch has risen to such a commanding place in the BNPL sector. As buying patterns have increasingly moved online in light of recent lockdown restrictions, consumers have found the offerings by the fintech unicorn to provide an added flexibility to their shopping habits. Moving forward, expect continued expansion from the company as it seeks to further develop its robust offerings and grow its user base to even greater heights.