Payment network Affirm has secured up to $4bn investment from global investment firm Sixth Street through a long-term capital partnership.
The investment, executed through Sixth Street’s asset based finance platform, involves the purchase of Affirm loans via a unique AssetCo structure under a three-year forward flow agreement.
According to Affirm, the latest agreement represents the largest capital commitment the payment network has secured to date.
The partnership is expected to provide Affirm with off-balance sheet funding, enabling the company to extend up to more than $20bn in loans over the next three years.
Affirm’s diverse funding model leverages multiple channels, including warehouse facilities, forward flow agreements, and asset-backed securitisations.
The firm provides easy-to-use solutions for merchant partners and access to transparent and flexible financing for consumers. It also allows consumers to pay over time without hidden or late fees.
As of 30 September 2024, the company’s total funding capacity stood at $16.8bn, representing a 50% increase over the past two years.
Affirm collaborates with more than 130 investors to maintain and expand its funding capacity. The firm aims to scale its operations further, delivering transparent and flexible payment options for over 19 million active consumers.
The company generated more than $28bn in gross merchandise volume (GMV) during the 12 months ending 30 September 2024.
Affirm chief capital officer Brooke Major-Reid said: “Sixth Street’s expertise in asset-based finance, long-term capital and collaborative approach make them an ideal partner for Affirm.
“Over the last several years, we have been extremely thoughtful in working with a diverse mix of world-class investors as we empower more consumers and merchants with our honest financial products.”
Founded in 2009, Sixth Street has more than $80bn in assets under management and committed capital.
Sixth Street partner and asset based finance head Michael Dryden said: “Affirm’s ability to provide flexible, scalable financing solutions is unparalleled, and we see tremendous opportunity in this partnership.
“We look forward to being a key funding partner for Affirm and continuing to build on this relationship to support the company’s growth in the years to come.”
