Card issuing fintech Marqeta is set to acquire the credit card program management platform Power Finance for $275 million in cash.
Marqeta, which reported a $53 million net loss for Q3 in November, views this acquisition as a means to enhance its technology stack for credit card program management. The deal will integrate Power’s advanced rewards engine with Marqeta’s own reward innovations, along with Power’s data science tools and capabilities for embedding experiences within existing mobile and web applications.
Simon Khalaf, the incoming CEO at Marqeta, stated, “We already see considerable demand for differentiated credit products from companies looking to innovate in this space who are held back by the constraints of legacy technology. We thoroughly examined possible acquisitions to more quickly establish Marqeta’s leadership in the modern credit space.”
Power Finance was established in early 2021 by fintech veterans CEO Randy Fernando and CFO Andrew Dust. Since its inception, the company has raised $16.1 million from various investors, including Anthemis, Fin Capital, CRV, Dash Fund, and Restive Ventures.
As part of the acquisition, Randy Fernando will lead the product management of Marqeta’s credit card platform. He commented, “At Power, we built a full-stack, cloud-native credit card issuance platform, and by becoming a part of Marqeta, we have the ability now to bring this innovation to a much larger market at global scale.”
The acquisition price includes $223 million in cash, with roughly one-third payable over a two-year period contingent on certain conditions, as well as an additional $52 million in cash tied to a milestone expected to be reached within the next 12 months.
The transaction is anticipated to close this quarter.