US paytech Stax hits $1bn valuation with $245m funding round

US paytech Stax has raised $245 million in fresh funding, taking its valuation up to $1 billion.

Stax co-founders Sal Rehmetullah and Suneera Madhani

The investment saw participation from Greater Sum Ventures (GSV), HarbourVest Partners and Blue Star Innovation Partners, all of which will serve as strategic partners to Stax.

Blue Star founder and CEO Rob Wechsler will join Stax’s board of directors. Weschler says the Covid-19 pandemic “escalated the need for dynamic, flexible and digital payment options” for small businesses, enterprise organisations and the software vendors that serve them.

Stax will use the new capital to develop new products, enhance its customer offerings, expand its workforce and continue to expand internationally.

Founded in 2014 by brother and sister Sal Rehmetullah and Suneera Madhani, who serve as president and CEO respectively, Stax has grown 500% in the past three years and processed more than $23 billion in payments for 22,000 businesses across the US through its payment API.

Rehmetullah says: “Businesses are just starting to realise how powerful payments can be in scaling their organisation, and we’re here to ensure that process goes as smoothly as possible.”

Commenting on the substantial raise and unicorn status, CEO Madhani says: “As a minority woman and executive in fintech, I’m no stranger to discrimination and doubt.

“We share this milestone not just with our team, but every person of colour trying to hustle, build their own business and make history.”