Founded in 2016 by Denis Raskopoljac, the Munich startup Xpay provides companies with Mastercard cards at no cost, which they can pass on to their customers in the form of a loyalty program. End consumers receive various discounts and benefits when shopping with the branded prepaid credit cards. In this way, the company aims to enable brands and influencers to intensify their customer and fan relationships. The startup also gained recognition through its luxury Visa debit card Legatus.
Financially, the startup was in good shape for a long time. In 2020, it secured 7 million euros in its Series A from investors such as Apeiron Investment Group, Grey Study Capital, and Swiss Daniel Gutenberg, who is referred to as a ‘unicorn hunter’. A year later came the Series B in an undisclosed amount, led by Rose Park Advisors. According to Finance Forward, Xpay has received a total of around 50 million euros from investors. The industry publication further reports that a new financing round failed, which has now led to insolvency.
Xpay’s operational business not affected by insolvency
In late August, the startup filed for preliminary insolvency at the Munich Regional Court. This applies to Xpay Holding AG as well as to Xpay Solutions GmbH and Xpay Development GmbH. Dr. jur. Matthias Hofmann, a Munich attorney, was appointed as preliminary insolvency administrator. In statements to Finance Forward, he made clear that Xpay Card Services GmbH, which operates as an e-money agent at the operational core, is not affected by the insolvency. The goal is now to reduce ongoing costs in order to become more attractive to investors and enable the company to continue operating.
