Amsterdam-based Recharge.com, a provider of online prepaid payments, announced on Thursday that it has acquired Startselect, a European digital gift and gaming cards company.
This move positions the Dutch company to generate €750M in annual sales in 2024.
The announcement comes a few weeks after Recharge introduced a new business-to-business service for corporate gifting. In July, Recharge.com expanded its operation to the US and Canada with Blackhawk Network’s distribution network in July.
Starselect: Gift card specialist
Founded in Eindhoven in 2017, Startselect specialises in the fast and easy distribution of digital gift cards, in-game credits, and subscriptions. It operates as the official reseller of various digital products, ensuring authenticity and customer trust.
When discussing the acquisition, Recharge’s CEO Günther Vogelpoel to Silicon Canals says, “Startselect’s stronghold lies in Europe, where they also have strong relationships with US brands. They will contribute with their gaming market knowledge to cater to that segment in the US & CA.”
“Recharge brings the scale and width of prepaid product offering, and Startselect brings their depth & expertise on the gaming segment,” he adds.
Moving forward, Startselect will extend Recharge’s consumer label offering, which includes global shop Recharge.com and country-specific labels Beltegoed.nl, Recharge.fr, Guthaben.de, Herladen.com, and Mobiletopup.co.uk.
Max Gudden, Founder of Startselect says, “I feel proud of the whole team at Startselect that made this milestone possible. Being a part of Recharge starts a new chapter for us, where we can reach new heights. We are eager to continue our growth path together.”
Recharge: ‘Supermarket’ for gift cards and mobile top-ups
Founded in 2010 by Robin Weesie and Dirk Ueberbach, Recharge is a global provider of online prepaid payments.
Currently, the Dutch company offers over 16,000 digital vouchers and prepaid solutions, including gift cards, gaming cards, prepaid money cards, and mobile phone top-ups.
Starselect marks Recharge’s first achievement in its M&A strategy to consolidate the digital prepaid payments market and further build out its global leadership position.
Explaining about M&A strategy, Vogelpoel shares, “We are currently witnessing the greatest downturn in the venture funding landscape, leading to a rapid transition from VC-fuelled growth to M&A-fuelled exit strategies. If we zoom in on the prepaid payments sector, one thing becomes abundantly clear—consolidation has been conspicuously absent. Consequently, our industry landscape remains a patchwork of fragmented players, with low barriers to entry but high barriers to scale.”
“This unique combination of market backdrop and industry dynamics unlocks a compelling acquisition window for us. We are crafting an M&A strategy that will leverage our scale and global footprint to further consolidate our market leadership, have deeper market penetration, and unlock new growth avenues that can further boost our organic growth trajectory,” he continues.
Recharge’s acquisition criteria
In addition to Starselect, the Amsterdam-based company plans to close another 2-3 acquisitions in the next 12 months.
Outlining the acquisition criteria, Vogelpoel mentions, “We are targeting acquisitions that can help us deepen our market penetration, diversify our revenue base, enter new segments, vertically integrate some of the products we distribute, launch completely new products, acquire a niche user base or diaspora specific corridors, or expand our presence in select geographies.”
“While we develop and maintain a criteria list depending on the acquisition rationale, our overarching goal is to pick opportunities that will have a profound impact on the future trajectory of Recharge, and will really move the needle in further propelling our mission and vision,” he says.
Roadmap
Since its inception, Recharge has been on an aggressive growth path with its online ‘supermarket’ for digital gift cards and mobile top-ups.
They were one of the first companies to offer easy online purchase of digital prepaid cards through their webshops and apps. To date, the company has processed over 100M transactions globally.
Discussing the company’s future, Vogelpoel remarks, “We see a bright future for digital prepaid payments also fueled by global growth trends. From people wanting to control their spend to remittance to the creator economy & remote first-digital nomads. We also see how important privacy is to our customers, and our products promote privacy-first payment methods.”
“We will innovate in several ways: making the experience significantly more convenient and faster for customers, by providing more control and options to manage their prepaid products. Example – we have taken a mobile-native approach to gift where in the future customers can use gift cards for 1-1 payout and rewarding others.”
Currently, the company operates in over 180 markets worldwide and is backed by Prime Ventures, Smartfin, Committed Capital, and BlackRock.
