Sezzle receives strong support

Buy-now-pay-later service provider Sezzle is on track for a strong stockmarket debut next month after its bookbuild was met with solid demand from investors.

A range of institutional investors from Australia, New Zealand and Asia threw their support behind the business, as did those through the Ord Minnett network.

The company, which is compared to larger rival Afterpay, sold Chess Depository Interest-style securities at $1.22 each in an initial public offering advised by Ord Minnett. The business will list with a market value of about $213.3m and an enterprise value of $162.8m.

Sezzle describes itself as a technology-driven payments company based in the US that capitalises on the lack of available credit for young consumers. The company works with 3321 merchants in 12 countries and has 269,800 active customers. Of its orders, 72.9 per cent were from returning end-customers as at March 31, increasing from 45.3 per cent over the year. Underlying merchant sales for the first quarter were $US28.3m ($40.9m), up from $US1.6m in the first quarter of 2018.

Merchant fees were $US1.4m for the first quarter of 2019, increasing from $US77,000 in the previous corresponding quarter.

Sezzle is due to start trading on July 23.