Returnly

The company's core offering was a post-purchase payments platform that enabled customers to receive instant store credit for returns, allowing them to repurchase items immediately without waiting for their original return to be processed. Returnly's business model was predicated on assuming the product return risk for the merchant. It utilized a machine learning algorithm to assess a shopper's risk by analyzing their past shopping activity across its merchant network, thereby mitigating fraud. Revenue was generated by taking a cut of each return transaction processed and charging merchants a subscription fee for its software-as-a-service (SaaS) solution. The platform provided a suite of return management tools, including a self-service portal for consumers, order tracking, and analytics for merchants to understand return patterns.

A key feature was "Instant Exchanges," where Returnly would front the cost for the new item, shipping it before the original was returned. This model aimed to convert potential refunds into repurchases, fostering customer loyalty and generating incremental sales for merchants. The company also introduced "Green Returns," a feature allowing retailers to offer "returnless refunds" for items that couldn't be resold, such as beauty or intimate apparel products, thus reducing waste and logistical costs. This was particularly beneficial for brands focused on sustainability.

Returnly served over 1,800 merchants and processed more than $1 billion in returns for over eight million shoppers. In April 2021, Affirm (NASDAQ: AFRM), a major player in the buy now, pay later (BNPL) space, announced it would acquire Returnly for approximately $300 million in cash and equity, with the deal closing in May 2021. Affirm, which had previously invested in Returnly's Series B funding round, saw the acquisition as a way to address the full shopping journey, from purchase to a seamless return. However, in July 2023, Affirm announced it was divesting and sunsetting the Returnly platform by October of that year, entering a new strategic partnership with Loop Returns as its preferred returns provider.