Merchant of Record Firm Paddle Raises $25 Million to Fund Expansion

Paddle, a merchant of record (MoR) for digital product companies, has raised $25 million.

The funding round, led by CIBC Innovation Banking, will help finance Paddle’s ongoing global expansion and product growth, according to a Thursday (July 17) news release provided to PYMNTS.

“In an ever-connected world, it’s important that digital product companies can receive payment from customers in any location without the hassle of navigating multiple payment processes in different geographies,” Sean Duffy, managing director of CIBC Innovation Banking, U.K. and Europe, said in the release.

As an MoR, Paddle handles payments, sales tax, refunds, fraud, and compliance for more than 6,000 Software-as-a-Service (SaaS), artificial intelligence (AI) and App companies, “replacing the need for a complex and fragmented payment technology stack,” the release added.

The company says it helps those businesses scale faster by lowering operational hurdles and helping them enter new markets faster.

“The funding comes at a pivotal moment for the company, with Paddle experiencing rapid growth in 2025 thanks to both the growth in new AI products, and the opening up of Apple’s app ecosystem to web payments,” the release said. “This builds on the company’s 40% year-over-year growth and reflects its accelerating momentum across the digital product space.”

Also Thursday, Paddle announced the hiring of several new executives, including two veterans of Shopify: Rich Mason, the company’s new CRO, International; and Ben Aronsten as CMO. Also hired was Stephen Wilcock as chief technology officer, “a multi-time CTO at scaling tech companies in Europe.”

PYMNTS wrote Thursday about some of the challenges companies face in scaling payments on a global level, citing findings from the “Payments Optimization: Powering Global eCommerce Growth” report, part of the Payments Optimization Tracker Series produced by PYMNTS Intelligence with Worldpay.

That report stresses that optimization “is not a one-time fix but rather an ongoing process that demands continuous attention to digital payment acceptance, transparent communication, and efficient delivery and return mechanisms, including local warehouse solutions.”

The addition of advanced fraud solutions, often powered by artificial intelligence and machine learning, is also spotlighted as key to securing transactions and building trust.

The report argues that leveraging third-party payment solution providers can streamline the complex optimization journey for merchants hoping to refine their payment strategies for each specific market.

The study concluded “that for businesses aiming to expand globally, payments are no longer merely a commodity but a critical competitive differentiator, empowering firms to streamline the checkout process, reduce friction, foster customer loyalty, and efficiently penetrate new markets to capture burgeoning global demand,” PYMNTS wrote.