Melio — Tel Aviv–New York B2B payments platform for U.S. SMBs. Acquired by Xero June 2025 for $2.5B cash plus $500M retention. Founded 2018 by Matan Bar, Ilan Atias, Ziv Paz. Largest Israeli fintech M&A of the post-2021 cycle. Template for embedded-fintech SMB reach.
Melio is the Tel Aviv–New York B2B payments platform for U.S. small and medium-sized businesses — the Israeli fintech that Xero acquired in June 2025 for $2.5 billion upfront plus $500 million in contingent retention. One of the largest Israeli fintech exits since the 2021 cycle.
What Melio Is
Melio Solutions Inc. is a B2B accounts-payable and accounts-receivable platform for U.S. small and medium-sized businesses. Founded 2018 in Tel Aviv. Headquartered in New York, with roughly half of its workforce in Israel. The core product is a browser-based tool that lets an SMB pay its vendors by ACH bank transfer or credit card even when the vendor only accepts checks — the platform prints and mails the check on the buyer's behalf.
Deep native integration with QuickBooks and other SMB accounting software. Later expanded into embedded partnerships — payments-as-a-service inside Fiserv's Clover POS, Capital One's SMB banking stack, Intuit's ecosystem, and Shopify.
The Founders
Matan Bar (CEO). Ex-PayPal, ran consumer P2P payments. Earlier sold The Gifts Project to eBay.
Ilan Atias (CTO). Ex-PrimeSense (acquired by Apple), later Outbrain and Windward.
Ziv Paz (COO). Ex-FIMI Fund, industrial M&A background.
A P2P-payments product operator paired with a hardware-scale engineer and an M&A-experienced operator. The founding-team template Israeli fintechs converged on in the late 2010s.
The Funding History
| Round | Amount / valuation | Lead(s) |
|---|---|---|
| Series C — Jan 2021 | $110M at $1.335B (first unicorn round) | Coatue, Accel |
| Series D — Sept 2021 | $250M at $4B | Thrive Capital, General Catalyst |
| Series E — Oct 2024 | $150M at $2B (valuation reset) | Fiserv, with Shopify Ventures, Capital One Ventures |
| Exit — June 2025 | $2.5B cash upfront + $500M retention contingent over 3 years | Xero (NZX/ASX: XRO) acquired |
Total capital raised before exit: approximately $638 million across six rounds.
The Xero Acquisition
Announced June 25, 2025. Structure: $2.5 billion in mostly cash consideration to shareholders at close, plus a $500 million contingent package spread over three years and primarily earmarked to retain Melio's roughly 600 employees. Break-up fee of $37.5 million payable by Xero if the deal fails Hart-Scott-Rodino antitrust review.
Xero — the New Zealand–headquartered cloud accounting software company, competitor to Intuit's QuickBooks — was buying the U.S. payments layer it had never built. Melio was buying a distribution machine into a global SMB accounting user base. Uniting accounting and payments in one platform is the strategic thesis Xero framed publicly.
The Business Under the Cover
- Roughly 10x revenue growth between August 2021 and mid-2025.
- Crossed $100M ARR in 2023 — three years after hitting $10M.
- Approximately 600 employees at acquisition, split between Tel Aviv and New York.
- Series E in 2024 was a valuation reset from $4B to $2B — the acknowledged compression the entire 2021-vintage Israeli fintech cohort took. The Xero deal cleared above the reset mark.
Why It Matters
Category-clearing Israeli fintech exit. The 2025 pair — eToro's $4.3B Nasdaq IPO in May, Melio's $2.5B Xero acquisition in June — reopened the exit window that had been closed since the 2021 downturn. Different structures (public listing vs strategic sale), same signal.
B2B payments as an Israeli specialty. Israel now anchors both sides of the B2B payments layer: Melio for SMB payables, Tipalti for mid-market global payables, Payoneer for cross-border SMB, Rapyd for platform payments infrastructure. Four companies, one category, all Israeli.
The distribution model that worked. Melio's exit is validation of the embedded-fintech playbook — landing SMB reach not by acquiring merchants but by living inside QuickBooks, Fiserv Clover, and Capital One's existing SMB relationships. That is the template every follow-on Israeli B2B fintech now studies.
One-Line Summary
Melio is the Tel Aviv–New York B2B payments platform for U.S. SMBs — acquired by Xero in June 2025 for $2.5 billion plus $500 million retention, the largest Israeli fintech M&A of the post-2021 cycle and the operational template for embedded-fintech SMB reach.
