Buy Now, Pay Later Leader Sezzle is Now a Public Benefit Corporation
New designation will drive company governance and ensure that its focus on driving positive community impact stands on equal footing with delivering returns to shareholders
- The US-based payments company is first to achieve Public Benefit Corp. (PBC) status in the fast-growing 'Buy Now, Pay Later' sector;
- Becoming a PBC signifies that a company not only delivers shareholder profit but also creates a positive impact on the community at large;
- The PBC designation formally aligns Sezzle's long-stated mission of "Financially empowering the next generation" with its corporate governance charter; and
- Sezzle is joining the ranks of nearly 4,000 other PBCs across the U.S., including well-known brands such as Patagonia, Allbirds, and Athleta, which have adapted their own corporate charters to place equal importance on both community benefit and shareholder ROI.
MINNEAPOLIS, June 24, 2020 /PRNewswire/ -- Sezzle Inc. (ASX: SZL) (Sezzle or Company) // Today, Sezzle announced that it has changed its company charter, becoming a Public Benefit Corporation (PBC.) The designation enables the company to become the first PBC in the burgeoning "Buy Now, Pay Later" (BNPL) payments space.
Following stockholder approval earlier this month, the company has completed the necessary filing requirements and has formally transitioned into a PBC. The new status compels the company's leadership to manage against the aligned goals of creating a positive impact on the community at large and serving the public good in addition to maximizing profit for shareholders.
A PBC is a specific type of corporate structure that allows for governance and management decisions to hold a purpose beyond maximizing value for shareholders; a PBC is a legal designation that requires businesses to do right by all stakeholders, requiring company management and its board to lead the company in a way that will contribute to a general public benefit, in addition to seeking a financial return for investors.
Sezzle's management team and fiduciary board strongly believe that the company's long-standing commitment to financial education and helping young adults with their approach to personal finances, as well as creating alternative means for consumers to purchase items they need without incurring high-interest finance charges, benefit the community and serve as a public good.
"Becoming a PBC cements our company's ethos -- 'to financially empower the next generation' -- into our governance structure," commented Charlie Youakim, CEO and co-Founder of Sezzle. "Young consumers across the globe are looking for long-term, trusted partners in their financial journeys. The PBC designation strengthens our positioning as the marquee mission-driven payments platform in North America. It shows that we are not just paying 'lip service' to the business's mission side -- we are 'walking the walk.'"
"Purpose-driven companies like Sezzle need to safeguard their ideals to stay true to their core values. Becoming a PBC enshrines our mission into our charter," added Youakim.
Sezzle, which is incorporated in the state of Delaware in the United States, followed local state guidelines during the conversion process. The board voted unanimously to approve the change in designation at the annual shareholder meeting on June 1, 2020. The official conversion became effective on June 2.
"One of the things that our retail partners share time and again is their sincere appreciation for the mission-driven aspect of our business," observed Sezzle's Chief Revenue Officer and co-Founder, Paul Paradis. "Not only are many of our current retailers excited to be working with a PBC, but this designation will now align us with other purpose-driven businesses who want partners who share a similar set of values. Frankly, no other BNPL delivers the same authentic value to customers and the community."
Sezzle has seen its key performance metrics continue to accelerate despite the economic headwinds resulting from the COVID-19 pandemic. In recent public statements, Sezzle announced that it eclipsed 1.3 million active customers and is approaching 15,000 active retail merchants. These continued successes have afforded Sezzle the ability to further extend its consumer-first approach by offering customers the ability to reschedule payments twice at no cost, understanding that many customers need a helping hand during the pandemic.
Sezzle has already presented a full slate of initiatives intended to fast-track many of the public benefit aspects of its business into high gear, including:
Sezzle U - an educational portal focused on personal financial education that is unveiling later this year;
An aggressive employee matching program for charitable donations in which the company will match up to $2,500 per employee each year; making it possible for the company to donate upwards of one million dollars to vetted causes of employees' choice; and
"At Sezzle, we see achieving stellar growth and maintaining our commitment to the community's collective good as two sides of the same coin," commented Karen Hartje, Sezzle's Chief Financial Officer. "Our company culture is highly committed to leveraging Sezzle's tremendous platform as a vector for pursuing positive change in the community and lending a hand to those left behind. Becoming a PBC is a natural step for Sezzle -- it is merely formalizing how we have operated since day one."
Merchants and retailers interested in learning more about Sezzle can learn more here. Consumers interested in signing up to use Sezzle can learn more here.
Sezzle's payment platform increases the ability for more than 1.3 million active users across the U.S. and Canada to gain financial freedom by offering interest-free installment plans at online stores and in-store locations. Sezzle's transparent, inclusive payment option allows consumers to budget their purchases, take control over their spending, and build toward the financial future they deserve.
Sezzle empowers consumers by increasing their purchasing power, which benefits retailers and brand partners by driving sales and expanding basket sizes for retail and eCommerce retail partners in the U.S. and Canada.
Sezzle's CDIs are issued in reliance on the exemption from registration contained in Regulation S of the U.S. Securities Act of 1933 (Securities Act) for offers of securities which are made outside the U.S. Accordingly, the CDIs, have not been, and will not be, registered under the Securities Act or the laws of any state or other jurisdiction in the U.S. As a result of relying on the Regulation S exemption, the CDIs are 'restricted securities' under Rule 144 of the Securities Act. This means that you are unable to sell the CDIs into the U.S. or to a U.S. person who is not a QIB for the foreseeable future except in very limited circumstances until after the end of the restricted period unless the re-sale of the CDIs is registered under the Securities Act or an exemption is available. To enforce the above transfer restrictions, all CDIs issued bear a FOR Financial Product designation on the ASX. This designation restricts any CDIs from being sold on ASX to U.S. persons excluding QIBs. However, you are still able to freely transfer your CDIs on ASX to any person other than a U.S. person who is not a QIB. In addition, hedging transactions with regard to the CDIs may only be conducted in accordance with the Securities Act.