Aged 10, Christer Holloman launched a Rent-a-Santa business in his hometown. He’d dress up as the Big Guy each Christmas Eve and, as per Swedish tradition, hand out gifts to excited kids. Their parents, relieved at not having to wear a fake beard, were more than happy to pay the asking price of 240 Swedish kronor. “I’ve got a picture of me aged 13 counting out my earnings on Christmas Eve,” laughs Christer, “I guess I was destined to become an entrepreneur.”
In a sense, Divido is the culmination of that Rent-a-Santa business, although Mr Claus probably didn’t feature in 41-year-old Christer’s recent Series-B pitch to investors. What did feature, however, is the size of the market he now operates in – all $2.5 trillion of it. And investors liked the sound of it. So much so that they have ploughed $50m into the company so far, with 2021’s Series-B, led by HSBC and ING, raising $30m.
So what precisely are these investors chasing? The answer is the retail finance market. Divido is on its way to becoming the world’s largest buy-now-pay-later white-label retail finance platform. “We’ve built software allowing customers to apply for instant credit when making purchases online or in-store,” says Christer. “We license the software to banks and retailers, who brand it and market it as their own service. We are the white-label engine behind buy-now-pay-later.”
This fintech company’s upward surge has been death-defying, launching in 2014 and growing by 1,250% over the past four years, bagging a place in the 2020 Deloitte Fast 50 in the process. No corner of the globe is out of reach for Divido, which is why big investors are whipping their wallets out. For example, the company recently went live in South America, partnering with Santander. Christer says: “For South American retailers who work with Santander, we now supply the underlying tech that enables customers to apply for credit, get approved, authenticate their identities and sign the contract. Our most popular product is 12 months interest-free finance. By offering this, retailers make more sales, so they see Divido as a marketing cost.”
Christer’s journey since co-creating Divido has been like speeding down the autobahn in a Porsche, but the drive before the launch was more lingering. He’s worked as a tech feature writer for Sky News, plied his trade as a News International employee, written three books (including his latest, How Banks Innovate) and launched Glassdoor.com in Europe. “I’ve spent my career helping others build digital products,” he says. “I’ve always been entrepreneurial, even at big organisations, but I waited until the time felt right before launching my own business.”
Christer’s story proves that becoming a founder can happen at any time in life. But how did he know the time was right? He says: “The main reason I launched Divido when I did was financial. I was made redundant at Glassdoor and my unemployment insurance paid out. I could have got another job but I thought, hang on, this is my chance. And then things fell into place. A venture capitalist I knew helped me to develop my ideas, a friend was in a position to assist, and another friend, a banker turned techie, was made redundant too.”
However, the key to Divido’s success is more than serendipity – it has grown so fast because of its inherent global scalability, which Christer says was always in the blueprint. “I knew from day one that I wasn’t going to build a British or Swedish company, but create a global platform,” he says. “From the beginning, we made sure our system was agnostic to languages, could easily be configured to different currencies, and regulated according to the laws of each land. Basically, we made sure our system was dynamic enough to handle different customer journeys around the world.”
Of course, getting this far this fast has required serious funding. Here are Christer’s tips for luring capital:
Enjoy the sales process
“I enjoy fundraising,” he says, “I’m a sales guy at heart and there’s no better sales job than convincing people that your ideas are going to fly. Having a positive attitude and loving sales definitely helps.
Choose a big market
“Secondly, mine is a vast market. If you’re operating in a massive market and have a credible proposition, it’s easier for investors to see how they can get their money back. People who struggle to raise capital often haven’t identified a market big enough to get people excited.
Show your authentic passion
“Thirdly, I love our industry. I soak up lots of information, enjoy talking about it, and have a big network. That comes across to investors as authentic passion. When you’re a new business, VCs don’t invest in your track record; they invest in you as a person, in your credibility as a founder and in your drive. Don’t underestimate the pulling power of authentic passion.”
With Series-B funding in the bank, a proven product, an enormous market to play in, and more global expansion on the cards, Divido is in an enviable position. But Christer isn’t sitting back. He knows that sustainable success depends on building the right workplace culture, and he sees diversity – in both team and mindset – as a vital ingredient. He admits there’s work to do in this area.
In a recent blog on Sifted.eu, he wrote: “I thought I was a poster child for diversity in the not-so-diverse world of fintech. Being raised by a single mother and having come out as gay in my teens while still living in my small, rural hometown on the fringes of the Arctic Circle in Sweden, I have always felt I’ve been an advocate for underrepresented voices. So I was shocked when one day I took a serious look at the leadership of the fintech I founded. Two other white middle-aged men stared back at me. Given my background, I was supposed to be good at diversity. I thought having the right values would make everything fall into place in my company. Where did I go wrong?”
Feeling things must change to power Divido even further forward – and simply because he thinks it’s the right thing to do – Christer is leading a project to inject greater diversity into his company. The first step was to ask a group of students from London Business School to help audit Divido and identify where it could improve. “They came up with an 18 point plan,” he says. “And we are committing over the next two years to implement those recommendations – they include everything from updating the language in our job posts to diversity and anti-bias training. There’s no point just putting a rainbow on your LinkedIn logo. You’ve got to enact real change.”
Such self-awareness and commitment to positive change bode well for Divido as it strives to become the world’s largest white-label platform for retail finance.
As for Christer, his entrepreneurial journey continues apace. He entered the retail finance market relatively late compared to the likes of Klarna and PayPal Credit but has taken it by storm by building a flexible white-label product that can be used all over the world. Banks and retailers love it and are queuing up to use it. Meanwhile, Divido’s investors are like kids at Christmas, excitedly awaiting their presents – a perfect situation for the entrepreneur who earned his first pound by dressing up as Santa.
Photo by Charlie Bibby used under license from the Financial Times. All rights reserved