Fintech Highlights - 5/31/2022
👋 Thanks again for subscribing.
Sorry we’re late this week. Monday holidays throw us off. But in return for your patience - this one is jam packed.
Here’s what’s worth watching this week….. 👇
Featured Company
Uprise - optimize your financial life, for free — www.producthunt.com
Uprise looks at their customers *whole* financial picture and tells them exactly what to do with their money, for free: tax strategies, the best accounts, investment best practices, which benefits to use, etc. They've unlocked an average $1.5M (!) in net worth per user (🎉)
Pinned to the Top
Swedish payment giant Klarna is going to cut hundreds of jobs in the coming days. Today’s news comes a few days after the Wall Street Journal reported that the company was going to cut its valuation in order to raise fresh capital. The company currently employs around 7,000 people.
Wow. This was unexpected. BNPL looked untouchable not so long ago. But public interest in ‘pay later’ products is waning as the global economy worsens. Add to that increased scrutiny from US watchdogs and you’ve got a situation that looks a bit bubble-shaped. In the words of Klarna CEO Sebastian Siemiatkowski: “When we set our business plans for 2022 in the autumn of last year, it was a very different world than the one we are in today”.
Dig deeper ->
The BFD
Andreessen Horowitz this morning regained its crypto crown, raising the largest-ever venture capital fund dedicated to web3 startups and projects.
The big picture: It's always sunny in the metaverse.
Backstory: A16z was one of venture's earliest and most aggressive movers into crypto, raising $350 million for its first fund in 2018. Its third fund nabbed $2.2 billion last year, but was surpassed by a $2.5 billion first-time fund from Paradigm (led by Coinbase co-founder Fred Ehrsam and ex-Sequoia Capital partner Matt Huang). It also saw partner Katie Haun leave to raise $1.5 billion for her own eponymous firm.
- The new a16z fund totals $4.5 billion, split between two "sleeves": $1.5 billion for seed-stage opportunities and $3 billion for more mature efforts.
The big question is if a16z is raising record sums at the wrong time, based on what the firm itself wrote in its recent "State of Crypto" report:
"Whereas prices are often a lagging indicator of performance in some industries, in crypto they are a leading indicator. Prices are a hook. The numbers drive interest, which drives ideas and activity, which in turn drives innovation."
Prices, of course, are down. Both Bitcoin and Ethereum are down around 50% over the past six months, while Coinbase shares are off nearly 80% over that same time period.
What they're saying: Arianna Simpson, a general partner with a16z Crypto, talked past that discrepancy during a conversation with me about the new fund, emphasizing long-term opportunity over short-term price fluctuations
"Many of the best companies are really built in quieter markets, and many of the best builders are today are drawn to web3" she said. "The same way that the Internet now powers all sorts of businesses that aren't viewed as tech businesses, crypto components are being embedded into games and online communities and other things that aren't traditionally crypto."
- She also addressed the skepticism of many Web 2.0 titans toward web3, which wasn't exhibited a decade ago by Web 1.0 entrepreneurs.
"The critical difference is that Web 1.0 was about open platforms and foundational protocols, with a really strong open-source ethos," she argues. "That went away and was replaced by walled gardens in Web 2.0. So it makes sense that the pillars of Web 2.0 aren't in favor of these new models, taking away power — and eventually money — from them ... Platforms like Twitter and Facebook have been extractive, taking without giving back to users. Web3 can incentivize participation by giving both some ownership and financial upside."
The bottom line: There are some signs of a crypto VC slowdown, but the market's biggest player is still sprinting forward.
M&A
Paddle, a British provider of payments infrastructure for SaaS companies, bought ProfitWell, a Boston-based subscription revenue and retention analytics, for around $200m. Paddle recently was valued at $1.4b in a KKR-led round. More here ->
Fintechs
Bloom, a revenue based financianing platform for companies, has secured $377m in Series A funding. The revenue-based lender says its pricing model and “pay-as-you-go” features set it apart from similar startups that have arisen in the last 18 months. More here ->
Viola Credit, an asset-based lending platform for fintech startups, has closed a $700M fund. Viola provides lending capital to fintech lenders. So, for example, for a company like Affirm, which provides installment plans to consumers, Viola Credit provides the lending capital to provide these receivables. More here ->
Fidel API, a global financial infrastructure platform, today announced it has raised $65 million in Series B funding. The company enables developers to create programmable experiences that enhance the value of using and accepting payment cards. Its platform provides identity, data, and payments products that allow developers to capture consent permissions and securely connect payment cards to a service or application. More here ->
Debbie, a Miami-based behavioral savings startup, raised $1.2m. Debbie offers its users a rewards platform for debt payoff, putting them on track to be net worth and cash flow positive. The startup encourages positive and constructive behavior with financial incentives for users to build good financial habits. More here ->
Onramp Funds, an Austin, Texas-based provider of financing solutions to ecommerce sellers, raised $42m in equity and debt funding. Onramp provides working capital from data to resolve the shipping, fulfillment, advertising and inventory cost of goods so that merchants can take their own capital and redeploy it into their growing business. More here ->
Pebble, the Y Combinator-backed seed startup, has come out of stealth with $6.2 million in funding for its blockchain-based personal finance app. The company offers 5% annual percentage yield (APY) on all cash deposits. Pebble is able to offer these relatively high yields through the use of stablecoins. More here ->
equipifi, a Scottsdale, Ariz.-based provider of BNPL solutions to banks and credit unions, raised $12m in Series A funding. equipifi helps financial institutions use their existing data and digital banking platforms to extend BNPL offers that align with their customers’ financial goals. As an added benefit, banks and credit unions can also leverage BNPL to grow existing revenue lines and open new ones. More here ->
Caribou, a Washington, D.C.-based auto financing platform, raised $115m in Series C funding. More here ->
Kapaga, a London-based cross-border payments startup, raised £1.5m. The platform is opening business accounts and providing multi-currency payment services to small and medium-sized companies in the U.K. More here ->
Marvin, a Brazilian B2B payments startup, raised $15m in Series A funding. The company aims to revolutionize the credit card receivables market by using the credit generated in credit card transaction payment terminals or POS as collateral for companies and retailers’ working capital and short term loans, so as to finance the their businesses. More here ->
Hyperpay, a Saudi payment processing startup, raised roughly $40m led by Mastercard. HyperPay is a "robust online payment gateway driving the future of cashless payments in the MENA region," processing millions of transactions a year for thousands of merchants "across almost every industry." More here ->
Jar, an Indian savings and investment app, is raising $50m in Series B funding at a $350m valuation. Jar, which operates an eponymous app, is helping millions of Indians begin their investment and saving journeys. The startup has amassed over 7.5 million registered users, it disclosed to investors last month. More here ->
Tranch, a London-based BNPL-for-business startup, raised £3.5m. The company bills itself as " the flexible new form of expense financing for fast-growing businesses” allowing them to “spread bulky expenses and take control of cash flow with £10k-£250k of dynamic credit.” More here ->
Crypto
Protego Trust Bank, a Seattle-based chartered crypto bank, is in talks to raise a round that would value it around $2b. More here ->
Babel Finance, a Hong Kong-based provider of institutional crypto products, raised $80m in Series B funding at a $2b valuation. Babel has evolved from a crypto lending business targeting miners and others into a comprehensive crypto asset manager for institutional investors. More here ->
Doppel, an SF-based monitoring service for NFT fraud, raised $5m in seed funding. The company enables companies and indivduals to protect their brand and community by detecting counterfeits, scams, and fraud with a real-time, cross-chain monitoring platform. More here ->
ZenLedger, a Bellevue, Wash.-based crypto tax startup, raised $15m. Fund. Government tends to struggle when it comes to keeping up with tech innovation. The past U.S. tax season that just wrapped up in April was particularly stressful for investors and the Internal Revenue Service (IRS) alike, as both struggled with the implications of 2021’s crypto investing boom. The IRS, for its part, turned to ZenLedger, for help. More here ->
Insuretechs
Jetty, a New York-based real estate insurance startup, raised an undisclosed amount of funding. Jetty is the "financial services company for real estate” with products that are designed to improve the financial lives of renters and their property managers. More here ->
Pet app and insurance provider Lassie has today closed an €11 million Series A round. Lassie’s biggest current competitors are Bought by Many (ManyPets) and Dalma. More here ->
Proptech
Latch, a proptech smart lock company that raised $152 million in known private capital before debuting on the stock market through a SPAC last year, is conducting another round of layoffs. Earlier this month, the startup cut 30 people, or 6% of its total staff. More here ->
Here, a protech startup that aims to make investing in vacation rentals as easy as buying stocks, is raising a round. Here’s marketplace allows both accredited and unaccredited investors to gain exposure and income from vacation rentals located in multiple destinations, "the first marketplace to do so.” More here ->
From the Stash
Roofstock founder closes on $90M fund to back early-stage proptech startups – TechCrunch — techcrunch.com 1Sharpe Ventures will invest in 30 to 40 early-stage companies in the real estate tech world. It is targeting pre-seed to Series A-stage companies.
Founder alleges that YC-backed fintech startup is ‘copy-and-pasting’ its business — techcrunch.com Eco's CEO alleges that Pebble, founded last year, engaged in "espionage" targeting the a16z-backed fintech company
Fintech Bolt just laid off over 100 employees across engineering, sales, and marketing — techcrunch.com One-click checkout startup Bolt has laid off at least 100 employees, and counting, across go-to-market, sales and recruiting roles, sources say. CEO Maju Kuruvilla confirmed the workforce reduction in a blog post, but did not say how many people were impacted or what roles were targeted. “It’s no secret that the market conditions across our […]
FTX US launches Stocks with Embed — medium.com I’m incredibly excited to share FTX US, through their broker-dealer subsidiary FTX Capital Markets, has partnered with Embed as their clearing firm and API infrastructure platform to power their…
Children of Durbin — kunle.app The blast radius of the Durbin Amendment
The Future of Auto Insurance- Connected: Embedded — www.insurtechworld.org The title is that from a recent article by Bryan Falchuk with links later in this content.Tesla is intent on bundling insurance as part of subscription ...
Stripe takes a swing at Plaid — techcrunch.com Hi all, it was a roller coaster of a week in the world of fintech as I published two separate articles on startup layoffs and a nine-figure funding round in the span of a few hours. It was also a week filled with lots of activity on FinTwit, or “Financial Twitter,” as it’s more formally […]
Crypto Bear Market Here A While — news.crunchbase.com While the public market has just recently flirted with a bear market, crypto investors know all about it. As inflation rises and stocks tumble, crypto seems to have followed suit. We take a look.
Reports / Webinars
Embedded Finance for SMEs: Banks and Digital Platforms — www.accenture.com Embedded finance on digital platforms integrates banking services into SMEs' workflow. Find out how this creates risks and opportunities for banks. Read more.
—
☑️ Thanks for reading. Please ask your friends, colleagues and others to sign up.
If you have any companies or news to share - use the form
AND - if we’re not already connected - let’s do it.