Spenda Limited (ASX:SPX) has entered into a binding Memorandum of Understanding (MOU) with eBev Pty Ltd, facilitating integrated payments solutions across the eBev marketplace, which encompasses the entire hospitality supply chain.
Spenda’s latest strategic partnership is with eBev.com (eBev), a software provider that aids hospitality organisations with alcoholic stock ordering through its platform enabling licensed premises to order beverages from its approved catalogue, encompassing 70,000 products from 12,000 beverage producers and 800 distributors.
eBev has established itself within the hospitality industry, generating over 2,500 licensed premises (buyers) purchasing through its platform on a regular basis.
The eBev’s ecosystem and its customers’ process $13.6 billion in B2B and B2C transactions annually, offering significant opportunity for Spenda and its integrated payment solutions.
A Strategic Partnership
The partnership between the two company’s will employ Spenda’s Pay-Statement-By-Link (PSBL) and Accounts Payable (AP) payments solutions into the eBev platform across the hospitality supply chain.
eBev and Spenda will supply licensed premises with merchant services that enable them to take B2C payments via both physical and virtual terminals, as well as e-invoicing services and payment services.
Spenda also plans to utilise its partnership with AirPlus International to provide extended terms of trade to eBev customers through the provision of pre-approved virtual Mastercards (card-blended trade finance).
Poised for Rapid Scaling
The cardblended trade finance is complementary to Spenda’s current debt funding structure, and enabled a new lending service to be embedded on the eBev platform, which doesn’t require first loss capital, thus enabling Spenda to scale rapidly into larger facilities, cross-border opportunities and the delivery of international services.
The partnership is also poised to generate large revenue streams for the Company, tapping into eBev’s $13.6 billion in B2C and B2B payments, and upon completion of the full commercial rollout, Spenda is set to receive a blended net revenue margin of 2-4% across the eBev marketplace from transactions which utilise Spenda’s payments solutions.
Revenue is expected in a number of forms from the partnership
- SaaS fees for delivery and integration across the aggregated eBev marketplace;
- B2C payment revenues from POS terminals at the retailer;
- Card blended finance revenue between retailer and eBev (B2B payments);
- Card blended finance revenue between supplier/wholesaler and eBev, including early settlement discounts (B2B payments)
Figure 1: eBev revenue flow
Two-Phased Roll Out
The integrated payment solutions are set to be rolled out in two phases, phase one anticipated to commence in the second half of financial year 2024.
In this first phase, both company’s will offer B2C payment services up to 100 initial customers over three months.
This phase alone is anticipated to generate approximately around $800 000 in annualised revenue, in addition to cardblended finance facilities of up to $50 000.
The second phase is predicted to begin in the final quarter of financial year 2024 into 2025, with the service being scaled and offered more broadly to all stakeholders in the eBev marketplace, encapsulating the entire hospitality supply chain.
eBev’s CEO Ian Harris commented on the partnership.
“In these more challenging economic difficult times, businesses look for ways to save time, money and manage their cashflow,” he said.
“This partnership with Spenda enables eBev to continue evolving our offering to the eBev marketplace.”
“Spenda has been a critical partner in our growth over the last two years and building a deeper partnership will be key to delivering ongoing value to our customers.”
Spenda’s Managing Director Adrian Floate added the partnership validates the Company’s unique payments solution.
“Expanding this partnership with eBev reflects further market validation of our unique payments solution across distributed networks in different industry vertical,” he said.
“Our solutions are well suited to the hospitality industry which has an integrated network of buyers and sellers through the supply chain.”
“eBev has done a fantastic job of growing its merchant base and ordering volumes. This partnership with eBev, in addition to recent agreements with Carpet Court, AgriChain and Capricorn demonstrates our ability to keep layering recurring revenue streams.”
SPX’s Australian Stock Exchange-listed share price has increased 8.33% and is currently trading at $0.013 today (8.15am UTC+ 8 hours).