Payments fintech Highnote emerges from stealth with $54m funding

SME-focused embedded payments platform Highnote has emerged from stealth with $54 million of combined Seed and Series A funding.

Highnote founders John Macllwaine and Kin Kee

The Series A funding round was led by healthcare and fintech-focused investor Oak HC/FT and the Seed round was co-led by Oak and Costanoa Ventures.

Early-stage VC firm XYZ, growth equity firm WestCap and healthcare and SVB Capital also participated.

Google’s president of commerce and payments, Bill Ready, and the CEO of US neobank Upgrade, Renaud Laplanche, also participated as angel investors.

Highnote was founded by John Macllwaine, a former general manager at PayPal’s mobile payments subsidiary Braintree, and Kin Kee, former director of architecture at Braintree.

The funding will be used to grow Highnote’s product and engineering teams as it continues to build out its platform to include instant credit issuance and full stack acquiring.

Embedded finance — frictionless payments for ride shares, retail and bills — is expected to be a $3.6 trillion market over the next decade in the US.

Because ecommerce tech giants like Amazon, Shopify and Apple can outspend SMEs in the space, Highnote says its low-code API single platform and data feedback allows smaller players to compete on card issuance, customer loyalty and engagement.

Highnote claims its clients can launch virtual card programs in weeks, rather than months.

“Highnote’s ability to act as the issuer and the processor allows us to own the user experience while also providing significantly better revenue generation and lower cost of ownership than any other solutions we evaluated,” says healthtech company Nayya’s head of product Aman Magoon.