Laybuy builds a global business

UK-based Gary Rohloff, co-founder and MD of Kiwi ‘buy now, pay later’ service Laybuy, explains how he and his son Alex created a global solution.

From the outset, Laybuy was built to become a global solution – one that could find its footing in New Zealand and expand offshore once the model was fine tuned. 

Like all successful businesses, ours began when my son Alex and I identified a gap in the market. We saw an opportunity to provide an alternative to the traditional credit model, and give Kiwis the ability to buy something, get it immediately and pay it off in instalments without incurring interest.

It was tough to convince banks to fund us in the early days as they really struggled with the fact that we were offering unsecured consumer credit, and couldn’t get their heads around our debtor ledger model. Securing the kind of funding we needed to be comfortable with our growth trajectory took about seven months. And, like a lot of other small, family-owned businesses, we had to put our personal assets on the line to convince the banks to get on board. Overcoming these challenges was particularly difficult because we were creating a business model that was previously unseen in New Zealand.

But we did it, and Laybuy launched in June 2017, revolutionising the way we pay.

The business grew rapidly in the first six months after launching, with thousands of Kiwis taking up our offering.

“After over a decade running some of New Zealand’s most iconic retailers, not only did I know how to talk to retailers, but also a lot about resilience and the benefit of surrounding yourself with talented people.”

My experience as a CEO in the retail industry undoubtedly helped contribute to Laybuy’s success. After over a decade running some of New Zealand’s most iconic retailers, not only did I know how to talk to retailers, but also a lot about resilience and the benefit of surrounding yourself with talented people.

Scaling in New Zealand was reasonably straightforward for us given the population size of just 4.7 million. New Zealand wasn’t enough, though, and in 2018 we started our move into the Australian market – as we’d always envisioned. What’s more, Australia allowed us to prove the portability of our BNPL solution, and in early 2019 in the UK in partnership with Footasylum.

Gaining traction in this new market was a major challenge for us as ‘buy now, pay later’ is not as ubiquitous here as it is in Australasia. A large amount of our focus has therefore been dedicated to educating the market on the buy now, pay later model, led by the success we’re experiencing down under. 

No one else was doing exactly what we do here. What’s more, our offering is markedly different to other BNPL providers; unlike many others, we don’t profit from the consumers. We’re proud to be able to operate as an interest-free payment provider, encouraging healthy spending habits and a way to help people build credit without fearing debt.

There is an untapped opportunity here for merchants to boost their sales, increase their customers’ basket size and open access to new customers with our service. Incrementally, UK retailers are becoming more and more aware of this. 

One of the biggest challenges has been tapping into a network within the UK.  Having lived and worked in New Zealand all my life, coming to the UK and having no network at all was certainly challenging.

Overcoming that has taken a lot of patience and determination but we have been fortunate to have made some early connections who helped us build networks across the UK.

Now, two years after Alex and I first launched Laybuy, we have acquired more than 4,000 merchant partners, while our customers number in the hundreds of thousands.

The size of our team has grown by more than 800 percent in our first two years and we continue to evolve into a truly global business. Today we have offices in Auckland, Sydney and London.

The fundamental principles behind Laybuy will always remain the same, however we are absolutely committed to tailoring our service specifically to customer needs. We know we need to be agile and be able to adapt to consumer trends quickly.  

Expanding into the UK was a massive milestone for us as it was a decisive step closer to realising our vision of creating a global payment platform. Opening an office in the UK and relocating here was a logical, yet bold move for the business and one that is perfectly placed to facilitate our future plans.

Photo: Alex and Gary Rohloff.