Summary:
Melio, an Israeli fintech unicorn, is in talks for a $1.5-2 billion acquisition by Xero
This could be the second major fintech exit in Israel for 2025, after Next Insurance
Melio's revenue grew tenfold since 2021, reaching $100 million ARR in 2023
The company underwent restructuring, including layoffs, to streamline operations
The deal highlights a potential rebound in the fintech sector after recent challenges
Melio, the Israeli fintech unicorn specializing in payments solutions, is reportedly in advanced talks for a $1.5-2 billion acquisition. This potential deal could mark the second major fintech exit in Israel for 2025, following Next Insurance.
Photo: Dana Tamari
The Potential Buyer
According to sources, New Zealand's Xero, a fintech giant with a $20 billion market cap, is leading the negotiations. Melio has declined to comment on these reports.
Recent Funding and Growth
In 2024, Melio secured significant funding led by Fiserv, with participation from Shopify, Capital One, and others. Despite a valuation cut, the company has seen a tenfold revenue increase since its last funding round in 2021, surpassing $100 million in annual recurring revenue (ARR) by 2023.
Challenges and Restructuring
The company underwent restructuring, including layoffs in Israel and the U.S., as part of efforts to streamline its sales and marketing operations.
Industry Context
This deal could signal a rebound in the fintech sector, which has faced challenges like tightening venture capital and declining valuations. It follows the acquisition of Next Insurance by Munich Re, highlighting a potential resurgence in fintech exits.
About Melio
Founded in 2018 by Matan Bar (CEO) and Ilan Atias (CTO), Melio employs 600 people across Israel and the U.S. The company offers a digital payments platform for U.S. businesses, enhancing services provided by financial institutions and software companies.
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