Fintech Highlights - 1/11/2022

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Here’s what’s worth watching this week….. 👇

Pinned to the Top

This week in the UK - upstart Starling Bank's CEO Anne Boden angered fintech founders after claiming that Open Banking has been a failure in the UK.

So what? Well, 53 bank bosses responded to Boden’s comments, made during a Treasury Select Committee hearing, with letters to UK Member's of Parliament. They dubbed her remarks “uncompetitive and typical of banks trying to thwart the future of innovation in financial services”.

The big picture: Coming from one of the premier fintechs in the country, the comments are a little surprising. However, they’re not without justification.

Four years after the legislation passed in the Uk that spawned the Open Banking concept - they've yet to see the big shakeup many were hoping for. But it’s very early days to be making big statements.

As Credit Kudos CEO Freddy Kelly pointed out: “Thousands of companies and millions of customers are now relying on open banking - and we're just scratching the surface in terms of its potential.”

What comes next? It was never a silver bullet solution. But a lot of people were expecting a bit more by this point in the journey. Rather than accusing Boden of stifling innovation, it’s time to think about how the concept can evolve.

The BFD

Dave, a Los Angeles-based fintech company billing itself as a modern digital bank, is the latest test of the above trend that targets merging with experienced sponsors perform better.

Driving the news: Dave began trading on the Nasdaq on Thursday, closing its first day up 3%, with a market capitalization of about $3.1 billion — below the $4 billion valuation it initially expected. It closed at $5.82 on Friday, another 31.77% down.

The intrigue: Its SPAC sponsor, Victory Park Capital, has a history of backing fintech companies, including Square, iZettle, Kabbage and even Dave itself. Citigroup and Jefferies underwrote the SPAC. But it also attracted PIPE capital from top investors: Tiger Global, Wellington Management, Corbin Capital Partners and Alameda Research.

Yes, but: Fintech companies (excluding insurance and property ones) are down an average 35.4% since their respective first-day closing price, compared with 27.4% for the total 2021 IPO class, per Renaissance Capital, Axis writers Ryan Lawler and Lucinda Shen point out.

What to watch: Dave's first quarterly earnings as a public company, and how the market reacts.

Fintechs

FloatMe, a San Antonio-based consumer-focused financial wellness platform, reported a $14.2M venture funding round from undisclosed investors. FloatMe has raised $42.9M to date. More here ->

HomeSmart, a Scottdale, Ariz.-based online residential property brokerage, filed for an IPO. It plans to list on the Nasdaq (HS) and reports a $2 million net loss on $478 million in revenue for the first nine months of 2021. More here ->

Payix, a Bedford-TX based software that provides lenders and loan servicers tools to engage with borrowers and collect payments, was acquired by Atlanta’s Repay Holdings Corp for $95M, with an additional $20M in earnouts. More here ->

Petal, a New York-based credit card startup, raised $140 million at an $800 million valuation. Petal offers two Visa credit card products aimed at underserved consumers with little to no credit history. The startup says its goal is to help people “build credit, not debt.” And it offers that credit based on cash flow rather than credit scores. More here ->

Finexio, an Orlando, Fla.-based accounts payable payments-as-a-service startup, raised $10 million.  Finexio's integrated AP and Procurement software installed customer base has over 150,000 bank accounts generating over $25 billion in accounts payable spend. More here ->

Ampla Technologies, a startup that provides financing to small-to-medium sized consumer-facing businesses, announced today it has raised $40 million in a Series A round of funding. While there are a number of startups out there funding SMBs and e-commerce businesses, Ampla claims that its differentiator is that it provides businesses with a line of credit that includes “omnichannel” revenue streams in underwriting. The company’s goal is to give founders access to more capital at lower cost More here ->

Sperta, a 6-month-old startup that wants to help fintechs better manage fraud risk, has raised $3m. Founded by two former UBER executives, Sperta is building a risk decision platform with a rules engine at its core. Sperta also integrates with data vendors, and it also allows analysts to transform features obtained from those vendors. More here ->

Tipalti, once a fintech unicorn, is now nearing decacorn status. The company, which automates accounts payables for mid-market companies, announced today that it has raised $270 million in a Series F funding round that values the company at $8.3 billion. In a nutshell, Tipalti uses artificial intelligence to help businesses manage suppliers, invoices, purchase orders, tax compliance, payments and billing and other accounting services from a single cloud platform. It claims to reduce companies’ operational workload by 80% by giving them the ability to pay partners and vendors “within minutes.” More here ->

Goldfinch, a Walnut, Calif.-based DeFi credit platform focused on developing markets, raised $25 million from Andreessen Horowitz, Coinbase Ventures, SV Angel, and other prominent investors. Goldfinch is building a decentralized lending protocol that allows organizations to receive crypto loans without owning massive amounts of crypto already. More here ->

Alto, a Nashville-based platform that lets individual investors add alternative assets to their IRAs, raised $40 million in Series B funding.  More here ->

PayFit, a French provider of payroll and HR management solutions for SMEs, raised €254 million in Series E funding at a €1.82 billion valuation. The company has been building a payroll and HR software-as-a-service platform for small and medium companies. It is operating in a handful of European countries — around 150,000 people currently get paid through PayFit. More here ->

Sygnum, a digital asset (crypto) bank and trading platform based in Switzerland and Singapore, raised $90 million at an $800 million valuation. Sygnum, which has a Swiss Banking license, is planning to use the funds to accelerate the development of institutional-level Web 3.0 offerings. Additionally, the crypto firm is planning to expand its presence in new global markets. More here ->

Brankas, an Indonesia-based open banking startup, raised $20 million in Series B funding. Brankas’ platform offers a roster of more than 10 “banking-as-a-service” embedded APIs, including ones for opening online bank accounts, credit scoring, identity verification, e-commerce transactions and gig economy payments.  More here ->

Timo, a Vietnamese digital banking startup, raised $20 million. Established in 2015, Timo is Vietnam's first digital bank and has steadily evolved to become the country's leader in digital banking.  More here ->

Rupify, an Indian B2B payments platform, raised $24 million. The company currently provides buy now, pay later service to several marketplaces to serve their merchants, and is looking to expand its business-to-business payments offerings. More here ->

Insuretechs

Integrity Marketing Group, a Dallas-based tech-focused insurance company, announced the acquisition of The Diversified Companies, a distributor of Medicare, with undisclosed terms. Integrity has raised $2.1B to date with investors including Silver Lake, Antares Capital, Crescent Capital, and Owl Rock Capital. More here ->

From the Stash

What’s Next For Proptech In 2022? More Investment In Construction, Optimizing For The Gen Z Renter, And M&A — news.crunchbase.com All told, venture-backed companies in the real estate and property tech space raised nearly $21 billion, Crunchbase data shows. Going into 2022, there will likely be more investment in real estate software surrounding the construction and property management spaces—two sectors that were standout areas for investment within proptech in 2021.

USAA Hires New Enterprise Chief Information Officer and Chief Security Officer — www.dig-in.com

USAA has hired Amala Duggirala as EVP and enterprise CIO, and Jason Witty as SVP and chief security officer.

Fintech Led VC Investment Last Year. Here’s What To Look For In 2022 — news.crunchbase.com Financial services was the leading sector for venture investment in 2021 with $134 billion invested, marking a whopping 177 percent year-over-year growth. That compares with overall global venture capital investment, which grew by a still astonishing 92 percent.

North American Startup Funding Scaled Unprecedented Heights In 2021 — news.crunchbase.com We don’t use many exclamation points when writing about startup funding. But the 2021 North American annual tallies require at least a few. In short: It was a really big year for funding! Really, really big!! It was record-setting big, and not by a small margin!!!

Last Year Was A Blockbuster For VC-Backed Startups. Here Are Our Top 9 Predictions For What 2022 Has In Store — news.crunchbase.com The startup and venture world has a lot to live up to in 2022, after a year that pretty much broke every record. With the big caveat that we of course can’t foresee the future, we nonetheless gazed into our crystal balls and came up with our best educated guesses for what 2022 has in store.

2022 Predictions: Core, Cloud and Banking — bankautomationnews.com Core and cloud providers are set to pour focus and funds into customer-facing innovation in 2022. Last year saw the core and cloud industry extend its influence on business and retail banking, with core providers and banks forming deep partnerships. Regional, niche and major banks alike began investing in core and cloud for a competitive […]

Reports / Webinars

The LiiP with Lotta Rauséus, COO & Co-Founder, Insurely — preview.mailerlite.com In this week's episode we are lucky enough to be joined by Lotta Rauséus, COO & Co-Founder of Insurely.  Insurely are using their open insurance ecosystem to help insurance companies and banks give proper peace-of-mind to their customers.

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