Fintech Highlights - 5/17/2022

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Pinned to the Top

Canada-based Neo Financial enjoyed a $185m CAD funding round, and announced it had reached 1 million users.

Which is a pretty big boost to the Canadian fintech ecosystem. Why? Well, at present, five big banks control around 90%(!) of the country’s market share.

Neo is hell-bent on addressing that balance.

Why is this important? The news comes off the back of big moves in the Canadian open banking space. The government named an open banking lead earlier this year in a bid to “give Canadians and businesses greater control over their financial data and be better equipped to manage their finances”.

The big picture: It’s a notoriously difficult market to break into, with the two biggest neobanks - Tangerine and Simplii - boasting over 2 million users and the backing of Scotiabank and CIBC.

Can Neo land a glove on an already crowded ecosystem? The proof will be in the pudding.

The BFD

Sam Bankman-Fried, founder and CEO of crypto exchange FTX, disclosed that he's acquired a 7.6% stake in retail brokerage app Robinhood (Nasdaq: HOOD).

Why it's the BFD: This is a passive stake, but it's hard not to view this as a de facto activist position or a toehold for acquisition optionality. Particularly as FTX and Robinhood continue to crowd in on the other's business. One caveat, however, is that Robinhood's co-founders would control any vote.

Market reax: On the day of the announcement, Robinhood shares opened up 23% at $10.54 a piece. For context, its IPO price last August was $38 per share.

The bottom line: "Retail trading has fallen to pre-coronavirus pandemic levels in recent weeks, as a market sell-off and rising inflation have soured investor enthusiasm. Robinhood missed its first-quarter revenue targets after reporting a 73% decline in stock trading from the previous year. Its cryptocurrency trading revenue dropped 39%." — The Financial Times

Other News

Crypto cops: The SEC is adding 20 positions to the enforcement unit overseeing crypto. More here ->

Robinhood introduced a “revamped” brokerage cash sweep program that will allow users to earn 1% interest on cash sitting uninvested in their accounts. The news comes just after the company announced that it was introducing a stock lending feature. After a tough quarter that saw Robinhood lay off 9% of its staff and reach all-time lows on its stock price, the company is rolling out new features rapidly as part of a push to diversify its revenue streams and grow its user base. More here ->

Digital bank Current launched an application programming interface (API), a product that it said will help facilitate seamless integrations and embedded banking experiences for its customers. Plaid is Current’s first partner on the product, which the two companies say will give Current’s customers access to more than 6,000 apps and services powered by the data aggregator’s network. More here ->

M&A

🐉 Checkout.com, a London-based online payments platform valued by VCs at $40b, bought Ubble, a French remote identity verification startup that had raised around $15m from firms like Partech and Breega. http://axios.link/LYg4

Nexi, the Italian fintech that scooped up rivals Danish-based Nets and then Italy’s SIA to create a $12.5 billion European payments giant, has made another acquisition, this time to dig deeper into financial services for small and medium businesses in the region. It has acquired Germany’s Orderbird for $140-150M. More here ->

Fintechs

Cushion, an SF-based bank and credit card fee negotiation startup, raised $12m in Series A funding. The funding is expected to help expand the company's plans to evolve from its current operation as an automated bank and credit card fee negotiation firm to a one-stop, single resource to track, pay and finance bills to help customers avoid overdraft and late fees imposed by banks. More here ->

TIFIN, a Boulder based wealth management tech startup, raised $109m in Series D funding. Tifin operates two major divisions — an investment marketplace for consumers called Magnifi, and a B2B arm that works with wealth advisors and enterprises that provide financial services to consumers. Within its divisions, it operates a suite of seven products, some of which are homegrown and some of which came to the platform through acquisition. More here ->

Infinicept, a Denver-based embedded payments startup, raised $23m. Since its previous round of funding in 2020, Infinicept has experienced rapid growth with more than a 1,400% increase in annual payments volume. More here ->

Acern, a New York-based AI for analyzing online financial documents and conversations about companies, raised $20m in Series B funding. The company uses AI to analyze online conversations around particular companies, trends and industries. More here ->

Meld, a fintech dev-ops startup, raised an $8m in seed funding. Meld’s customers bring their own third-party service providers onto the platform, and Meld is responsible for integrating each service provider onto the singular API and dashboard the customer uses. More here ->

Altro, a financial and investing literacy platform, has raised $18m. Altro plans to use its new capital to continue growing its credit and financial literacy program as well as grow its team. For example, Altro is focused on educating users through a catalog of over 350 educational audio clips covering topics topics like cryptocurrency, investing and trading. Watching the snippets, the company says, not only allows users to become more financially savvy, but also positively impact users’ scores the more they engage. More here ->

Minka, a Colombian provider of last-mile APIs and shared ledgers for national payment networks, raised $24m. Minka's technology connects separate legacy systems through blockchain concepts and modern APIs to simplify the movement of money flows.  More here ->

Dock, a Brazilian fintech infrastructure company, has raised $110m. São Paulo-based Dock operates a full-stack payments and digital banking “platform” across the region. More here ->

Token.io has closed $40 million in funding to expand its own particular push in payments tech. that being -  account to account payments and accessing accounts for transactions by way of a single API. More here ->

African payments company Interswitch has secured a $110 million joint investment. Interswitch is one of Africa’s largest electronic payments and infrastructure companies. The fintech powers much of the rails for Nigeria’s online banking system and is well known for its point-of-sale terminals, online consumer payment platforms, Quickteller and Verve, the biggest domestic debit card scheme in Africa (issuing over 35 million active cards since launch). More here ->

Crypto

Oasis, a Darien, Conn.-based digital securities marketplace, raised $27m in Series A funding. Oasis Pro Markets LLC, the ATS, wants to support everything from the issuance to secondary trading of all forms of digital securities, the company said. It also lets subscribers take the unusual step of paying in crypto for their digital securities, which are traditional investment assets (like shares in a company) that trade as tokens atop blockchain tech. More here ->

Paper, a crypto-focused payments processor, raised $7.3m in seed funding. Paper allows users to create wallets through their email addresses and purchase NFTs with credit cards (or crypto wallets) across the Polygon, Ethereum, Solana and Avalancheblockchains to provide non-crypto consumers a “frictionless” bridge for entry into the marketplace. More here ->

Casa, a Charleston, S.C.-based bitcoin storage startup, raised $21m. It has also launched and API that will allow developers of third-party organizations to integrate with Casa wallets while allowing users to maintain full control over their private keys. Users will be able to confirm financial information for situations including taking out loans, managing retirement investments and automatically depositing bitcoin to their Casa self-custody setup. More here ->

Cryptocurrency startup BVNK has closed a $40 million Series A funding round at a $340 million post-money valuation. BVNK offers banking services and payments for crypto-native businesses. Companies using BVNK can accept payments in both fiat and cryptocurrencies, hold hundreds of different currencies and crypto assets, and send funds all around the world. More here ->

Pipe competitor Crowdz has raised $10M for its blockchain-powered invoice financing marketplace. What is interesting - the investment is backed by Citi. More here ->

MARA, a pan-African crypto exchange, raised $23m in equity and token sales. MARA says it is building a suite of products that address various crypto-finance needs for the African audience. Its flagship product is a consumer crypto-brokerage app that allows users to buy, send, sell and withdraw fiat and crypto assets. More here ->

Elwood Technologies, a crypto trading platform founded by British hedge fund manager Alan Howard, raised funding at a $500m valuation. More here ->

Proptechs

Habi, a Bogota-based proptech, has closed on $200 million in a Series C funding round. Habi says its mission is to “empower” low- and middle-income consumers in the housing sector by providing access to liquidity and information “in a market where data is limited and the majority of homes are not listed online.” The startup currently operates in more than 15 cities in Mexico and Colombia. More here ->

Habi, a Bogota-based proptech, has closed on $200 million in a Series C funding round

From the Stash

To win insurtech 2.0, focus on underwriting before growth — techcrunch.com Focusing on customer experience on the front end leads to rapid growth indeed, but failing to focus on underwriting on the back end can lead to a very large number of claims, very quickly.

Crypto market bloodbath hits Solana particularly hard — techcrunch.com The past several days have been trying times for crypto investors as a broader market pullback has wreaked havoc on token prices. While Bitcoin and Ethereum have sustained over 20% declines each over the past week, a number of emerging projects have been hit even harder, including Silicon Valley darling Solana which has seen its […]

Google Chrome adds virtual credit card numbers to keep your real ones safe — techcrunch.com Google today announced that its Chrome browser will now offer users the ability to use a virtual credit card number in online payment forms on the web. These virtual card numbers allow you to keep your “real” credit card number safe when you buy something online since they can be easily revoked if a merchant’s […]

Google launches Google Wallet to help you store your credit cards, tickets and more — techcrunch.com Google today launched Google Wallet, a new Android and Wear OS app that will allow users to store things like credit cards, loyalty cards, digital IDs, transit passes, concert tickets, vaccination cards and more.

Facebook Pay will be renamed Meta Pay soon — techcrunch.com Meta is exploring how it can simplify payments across its platforms to make it easier to access and process in the metaverse. Facebook Pay will become Meta Pay.

SEC chair Gary Gensler takes aim at crypto exchanges for trading against their customers — techcrunch.com Gensler expressed concern that major crypto exchanges are "front-running" customer trades

Airbnb is reinventing itself — Brian Chesky tells us why — techcrunch.com We sat down with founder and CEO Brian Chesky to discuss the release, where Airbnb is headed and how he's planning for the future.

SWBC launches new fintech subsidiary — www.bizjournals.com

The newly formed SWIVEL Transactions will offer SWBC's transaction-enablement platform —used by more than 800 financial institutions in 50 states.

Reports / Webinars

“Web3 is a new business model for the internet, and the next evolution of the internet itself” — www.11fs.com Our brand new web3 report unpacks the biggest conversation taking place in the world of finance. Tokens, Stablecoins, DAOs, wallets - we explain it all and so much more.

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