US-based smartphone financing service PayJoy received $8.5m in series A funding on Monday from a consortium including Orange Digital Ventures, the early-stage investment arm of telecommunications firm Orange.
Draper Nexus Ventures, Fenway Summer Ventures and Core Innovation Capital also participated in the series A round, which was led by Union Square Ventures (USV).
Western Technology Investment provided $4m in venture debt in conjunction with the equity portion, and the company also secured $5.7m in private lending capital, bringing the total secured in the round to $18.2m.
Founded in 2015, PayJoy’s technology enables consumers to purchase a smartphone by paying for it in instalments. The offering is aimed primarily at the underbanked.
Users can sign up to the service at a local merchant, using their Facebook account and a government-issued ID. They make a deposit, choose a payment plan and the merchant installs PayJoy’s software on the phone allowing the customer to repay the company over the course of the plan.
Olawale Ayeni, principal of startup investments at Orange; Mitch Kitamura, managing director at Draper Nexus; and Arjan Shütte, founder and managing partner at Core Innovation Capital, will join PayJoy’s board of advisors. John Buttrick, partner at USV, will join its board of directors.
PayJoy previously closed $2.3m in equity funding from investors including Red Swan Ventures and Metamorphic Ventures in December 2015 alongside $1m in debt financing and a $1m fund that supports smartphone distribution to the disadvantaged.