Affirm to acquire Returnly for $300 million
San Francisco-based Affirm Holdings Inc. announced on Wednesday plans to acquire Returnly, a leader in online return experiences and post-purchase payments.
Under the terms of the agreement, Affirm will acquire Returnly for approximately $300 million in cash and equity. The transaction is expected to close in Affirm’s fourth fiscal quarter ending June 30, 2021, and is subject to customary closing conditions.
Affirm’s acquisition comes as returns continue to be a source of increased costs and complexities for merchants. In fact, U.S. consumers returned an estimated $428 billion in merchandise to retailers in 2020, while online returns, which often occur at triple the rate of brick and mortar retail, more than doubled in 2020 from 2019.
The appeal of Returnly is that consumers receive an instant merchant credit upon initiating a return, allowing them to order a new or replacement item immediately versus waiting until their return is fully processed.
“Over the last few years, alongside the rapid growth of online shopping, consumers’ expectations of accommodations for returns and exchanges have increased significantly,” said Max Levchin, CEO and founder of Affirm.
“In 2019, Affirm invested in Returnly because we recognized their technology’s ability to help merchants remove friction from returns, drive loyalty, and retain more customers. Store credit, issued before the item is actually returned, is now a practical requirement in highly competitive segments like fashion and lifestyle.”
Returnly currently serves more than 1,800 merchants, has helped process more than $1 billion in returns, and has been used by over eight million shoppers.
“We started Returnly to fix the broken returns model that offered consumers and merchants nothing but downside and frustration,” explained Eduardo Vilar, CEO and founder of Returnly.
“As returns continue to challenge and inhibit commerce, we believe that now is the right time to join forces with Affirm and expand the reach of our mission. We look forward to continuing to serve our customers and help more businesses offer the instant and easy returns experience that their shoppers have come to expect.”
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