A European competitor to Square could be making moves in the US soon, as SumUp — the POS provider — has acquired a customer loyalty startup named Fivestars.
It's no secret that customer retention has replaced customer acquisition as the go-to marketing strategy for businesses. After all, it's cheaper and more effective, making it kind of a no-brainer for companies looking to keep their revenue up.
It looks like one POS provider is taking that sentiment to heart, as SumUp has acquired customer loyalty startup Fivestars in service of providing its users with a more comprehensive way of retaining customers.
SumUp Acquires Fivestars for $317 million
Announced today in a press release, SumUp — a UK-based payment service and point-of-sale (POS) provider — has officially acquired Fivestars — a US-based customer loyalty and local commerce network — for $317 million.
“We founded Fivestars to give small businesses the opportunity to thrive in the digital economy and over the years, we’ve achieved just that,” said Victor Ho, cofounder and CEO of Fivestars in the press release. “Understanding that SumUp shares this mission, it was an easy decision to partner, and together, we look forward to supporting a retail market that champions small business success.”
According to the press release, Ho and the San Francisco-based team of Fivestars will continue to operate the company, albeit with significantly more resources and potential under the SumUp umbrella.
Why Has SumUp Acquired Fivestars?
After some impressive fundraising in the beginning part of the year — a $750 million round in March — this move by SumUp could position them to seriously compete in the POS and marketing industries. But why else might SumUp have been so interested in acquiring a US company?
“Now is the time to make sure our presence is as strong in the U.S. as it is in Europe and, by acquiring Fivestars, SumUp will deliver for U.S.-based merchants as it has in other international markets,” said Marc-Alexander Christ, cofounder of SumUp, in the press release.
While customer loyalty is a popular means of retaining your clients, and getting your platform familiar with it is a good idea, the reality is that SumUp is on the prowl for opportunities to establish itself in the US market. With this acquisition, they've taken a big step to do just that, which could put them in more significant competitive with US brands like Square and Shopify POS.
Getting Started with POS Systems
SumUp isn't yet a competitor in the US, but it'll be interesting to see how the company makes an impact once this deal is in the rearview mirror. Still, if you want to get set up with a POS system for your business, we can help.
For more information, check out this table below of some of the best POS systems available today, and keep an eye on SumUp to see if they become a viable option for your business.