Primer API, a well-funded start-up that provides software allowing merchants to manage their own payment stack grew revenue to £2.9m in 2023 according to its latest financial accounts. 40% of turnover comes from the UK but Primer recorded sales growth in Europe, USA and around the world. Although management has trimmed costs, the UK-based business made an operating loss of £15.6m.
Founded by Gabriel Le Roux, a former Braintree executive, Primer believes it has spotted a gap in the market with large merchants with complex payment needs that have outgrown sole supplier offers from PSPs but are not willing or able to build their own payment infrastructure.
Primer claims to be the world’s first open automation platform with a drag and drop framework that merchants can use to easily build a payment stack to sell online. This offer includes Primer’s own headless checkout which merchants can configure to set up their preferred payment flow.
Management is at pains to differentiate Primer from the small army of lookalike payment orchestrators competing for business today. Primer does offer routing to multiple acquirers including Worldpay, Stripe and Global Payments, but the software also manages 3DS, fraud, sales tax and reporting,
Primer’s target market is enterprise customers that have identified payments as a significant strategic challenge and likely have already hired an experienced in-house payment product team. A great example is Conforama, the French furnishing retailer which selected Primer and has been impressed with both its products and customer support.
The company has cut back on its heavy platform development spending although investment remains considerable. Administrative expenses fell from £24.5m to £18.4m in 2023 as employee numbers were reduced from 136 to 101. Staff are spread over 26 countries. The business is fully virtual, and everyone works remotely. Management believes this enables it to hire product and client management teams located close to its customers.
The operating loss narrowed to £15.6m from £24m in 2022 although the deficit improves to £12m after banking a £3.4m tax credit. Accumulated losses stand at £43m.
Primer is well funded. It raised $50m at a $425m valuation in 2021, supplemented in 2023 with a further £16.6m convertible loan and finished the year with £28m cash in the bank.
Although expecting “significant growth” in 2024, management says it is “mindful of market conditions” and is monitoring its cost base accordingly. Nevertheless, Primer has publicised expectations of increasing revenue 200% in 2024 which would take sales to almost £6m. This would be an impressive performance but remains a long way from profitability.
