Credit card giant Visa is acquiring Brazilian payments infrastructure startup Pismo for $1 billion in cash in what is likely one of the largest fintech M&A deals taking place this year so far.

Founded in 2016 by Juliana Motta (CPO), Ricardo Josua (CEO), Daniela Binatti (CTO), and Marcelo Parise (VP of engineering), São Paulo–based Pismo has quietly racked up a list of big-name customers, including Citi, Itaú (one of Brazil’s largest banks), Revolut, N26, Nubank and Cora. The startup processes almost 50 billion API calls and $40 billion in transaction volumes annually, and powers almost 80 million accounts and over 40 million issued cards.

For some context of the explosive growth Pismo has seen, at the beginning of 2021, it was doing less than $1 billion per month in transaction volume, according to Josua. It ended 2020 with fewer than 10 million accounts total.

Over time, Pismo has expanded out of its home country and now also operates in several countries across Latin America, including Mexico and Chile, as well as in the U.S. and Europe. The startup also has some customers in India, Southeast Asia and Australia.

Pismo’s cloud-native issuer processing and core banking platform is aimed at giving banks, fintechs and other financial institutions “flexibility and agility,” the company shared when it raised $108 million in Series B funding in October of 2021. It does things like allow customers to launch products for cards and payments, digital banking, digital wallets and marketplaces. Pismo also claims to allow financial institutions to “take charge of their core data and use it intelligently.”

In a written statement, Visa said that by acquiring Pismo, it “will be positioned to provide core banking and issuer processing capabilities across debit, prepaid, credit and commercial cards for clients via cloud native APIs.” The startup’s platform will also enable Visa to provide support and connectivity for emerging payment rails, like Pix in Brazil, for financial institution clients, the company added.

“Through the acquisition of Pismo, Visa can better serve our financial institution and fintech clients with more differentiated issuer solutions they can offer their customers,” said Jack Forestell, Visa’s chief product and strategy officer, in a written statement. The deal, which is subject to regulatory approvals and other customary closing conditions, is slated to close by year’s end. Pismo will retain its current management team, who will remain based in São Paulo.

SoftBank, e-commerce giant Amazon and Silicon Valley–based venture firm Accel co-led the startup’s Series B raise. Falabella Ventures, PruVen and existing backers Redpoint Ventures and Headline also participated in the financing, which brought Pismo’s total funding raised to $118 million. The company did not share its valuation, but Accel partner Ethan Choi told TechCrunch that the sales price was “a very strategic multiple.”

As a SaaS business, Pismo mostly made money by charging transaction fees. It has charged per active account, so prices decrease based on volume. In other words, the more clients a customer has, the less they pay per account.

In a written statement, Josua said: “At Pismo, we aim to enable our clients to launch cutting-edge payments and banking products within a single cloud-native platform — regardless of rails, geography or currency. Visa provides us unrivaled support to expand our footprint globally and help shape a new era for banking and payments.”

Visa was reportedly just one of several companies bidding for the startup, which was not seeking to be acquired, or even fundraising, according to Choi.

“Pismo wasn’t on the block,” he told TechCrunch. Besides the transaction representing “one of the largest LatAm cross-border fintech deals that has happened,” Choi believes it is also “an example of a global card network deciding that they would like to get closer to the banks and the financial institutions they work with by providing core banking and card issuing services to them, in addition to their credit card and debit card rails.”

He added: “There are a lot of synergies to be able to sell these really critical APIs to their existing financial institution customers.”

It’s not the first infrastructure play on Visa’s part. In March 2022, it closed on its $2.15 billion acquisition of Tink, a leading fintech startup in Europe focused on open banking application programming interfaces.

The credit card behemoth also famously abandoned its planned $5.3 billion acquisition of Plaid, a U.S.-based popular open banking startup, before having to call off the acquisition after running into a regulatory wall.

No doubt that Pismo getting scooped up by Visa is a coup of sorts for the entire Latin America region, which saw a surge in global investors pouring capital into the region in 2021 and a bit of a retreat since. It’s also a comeback story, considering that in 2019, Pismo was running out of the cash it had raised in a $900,000 seed round in 2016. In fact, things were so dire that Binatti and Parise even sold their only car in order to fund Pismo’s operations. Now the company’s just over 400 workers will become Visa employees.

The deal also marks the second time that Accel has purchased a financial infrastructure company that ended up getting acquired soon after. In 2020, consumer financial services platform SoFi announced that it was acquiring payments and bank account infrastructure company Galileo for $1.2 billion in total cash and stock. That company was founded in 2000 and bootstrapped to profitability before Accel wrote it a $77 million Series A check in 2019.

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