Deal focus: 2C2P brings enterprise to SE Asia fintech

Payments technology in Southeast Asia has quickly become big business, but big businesses, somewhat ironically, haven’t received much attention. This has been a consumer story first and foremost: shop-level transactions, services for unbanked individuals, and e-commerce. Now, a more enterprise-geared approach appears to be gaining traction.  

2C2P, a payments platform focused on defragmenting the region’s financial landscape for large corporates, has secured $52 million in Series C funding led by Cento Ventures. Arbor Ventures and the International Finance Corporation also joined the round, which brings the company’s total funds raised to date to $70 million.

“Southeast Asia was already complex, and now that VCs have put more money into it, it’s become very complex,” says Dmitry Levi, founder of Cento. “If you’re a large global business that just wants to sell tickets, goods, or services to Southeast Asia, you want simplicity and someone to take care of all the noise. That’s 2C2P’s role.”

This is the first formally announced investment under Cento’s late-stage strategy, which was launched in 2017 with a non-fund pool of capital backed by existing LPs keen to access more developed industrial themes but wary of hype in the regional unicorn boom. The plan is to target companies larger than Cento’s usual early-stage range but small enough not to attract the attention of private equity or large overseas players.    

The key rationale for 2C2P is that the consumer side of Southeast Asian fintech has arguably reached saturation, with Cento estimating there are more than 2,000 e-wallets in the region. While merchant-centric models are set to become a major opportunity set, the playing field appears relatively clear. This is especially true in the large-cap space where 2C2P serves clients such as airlines and international travel booking companies.

Founded in 2003, 2C2P has seen its overall metrics double every year since 2014, including total processed volume of payments, which is set to come close to $10 billion this year. Cento has been along for much of the ride, having first invested in 2011 via an early-stage vehicle that achieved an exit in 2017.

The latest round will be used to invest in new technologies, hire talent, and consolidate market share in Southeast Asia with a view to expanding beyond the region during 2020. Levit expects 2C2P to hit a $1 billion valuation in the foreseeable future and flags significant interest from a range of potential buyers, but exit plans are still well in the distance.

“There are large strategic entities that are not payments specialists that have reasons to want to have a stake in this space. Plus, the company is profitable, which is unusual for a business of this size in Southeast Asia, so private equity interest is significant,” Levit says. “At the end of the day, it’s all up to the founder. We’re just making sure that all the options are available to him four or five years out.” 

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• Topics
• Southeast Asia
• Expansion
• Financials
• Technology
• Southeast Asia
• Cento Ventures
• Fintech