Lifetime Value Company-led group acquires fintech Kipp

Kipp has been acquired by an investor group led by Lifetime Value Company.

The deal leaves the fintech operating independently under its existing co-founders as it seeks to expand in the US.

The new ownership structure provides long-term financial backing, merchant relationships and payments industry experience. Kipp is led by Chief Executive Officer and Co-founder Chanan Lavi and Chief Technology Officer and Co-founder Nir Levy.

Kipp works with card issuers and merchants on transactions that would otherwise be declined for insufficient funds. Its model allows merchants to pay a premium on selected transactions so issuers can choose to approve them, while consumers pay no additional fee.

Merchants can recover between 20% and 50% of transactions that would otherwise have been declined, depending on the merchant. The issuer decides which transactions and customer segments are eligible and sets the premium it requires.

US push

The acquisition is centred on Kipp's expansion in the US market, where both card issuers and merchants lose revenue when debit card transactions are rejected. For merchants, a failed payment can mean a lost sale. Issuers can miss out on interchange revenue and risk customers switching to another payment method.

LTVCo, which led the investor group, operates consumer brands including BeenVerified, Bumper and Ownerly. That gives the buyer direct exposure to the commercial effects of payment declines on merchants.

Kipp positions itself as a decisioning layer between merchants and issuers rather than a payment processor. When an issuer is about to reject a purchase because of insufficient funds, Kipp checks whether the merchant has agreed to pay a preset premium for approval.

Merchants do not need a technical integration on their side. Connections can be made through issuer processors or directly into issuer infrastructure.

Industry names

Alongside the transaction, Kipp has added several senior payments executives in board and advisory roles. They include Executive Chairman Jeff Stiefler, a former President of American Express; Strategic Advisor Adam Coyle, a former Chief Strategy Officer of Worldpay and Head of Strategy and Corporate Development at Vantiv; and Board Member Randy Christofferson, a former President of First USA and American Express Relationship Services.

The additions suggest Kipp is strengthening its commercial and industry ties as it tries to grow its network of issuers and merchants in the US payments market.

"Our focus now is expanding our US issuer and merchant network and bringing more transactions onto the platform," said Chanan Lavi, Chief Executive Officer and Co-founder of Kipp. "This acquisition gives us the long-term backing and operational resources to accelerate that work while preserving what makes Kipp valuable: issuers control their risk, merchants recover sales and consumers pay no additional fee."

The buyer described the deal as a response to the costs of avoidable transaction declines, including lost sales for merchants and weaker customer retention for card issuers when consumers turn to other payment methods.

"Every unnecessary decline costs a merchant a sale and an issuer a chance to remain the customer's preferred card," said Josh Levy, Chief Executive Officer and Co-founder of LTVCo. "We've seen that firsthand. Kipp aligns both sides to recover that revenue and deliver a better customer experience. We're committed to building Kipp for the long term, with the financial strength and resources to invest in its technology, expand its network and support its partners at scale."