Fintech Highlights - 6/28/2022

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Pinned to the Top

In Insuretech circle, talk is vibrant about how the dynamics between venture capital and founders are changing.

Gone are the days of grow premium at all costs. Now that actuarial science has caught up with high flying InsurTech IPOs, everyone is uncertain.

Will startups be able to hit their milestones? Will VCs have enough capital to fund the next crop of InsurTechs? Who is the new benchmark for growth, if it is not Lemonade?

Policygenius raised its Series E, then immediately followed it with layoffs. Next has raised nearly $1B to stay out of the public market. And, Coalition, another Series E company, has been out of the news.

In contrast, Branch just raised $147M at a $1B valuation. This was possible because of its recent accomplishments:

> It sustained 1300% YoY Premium growth

> It modeled how embedded distribution can work with partnerships like Homepoint Mortgage

> It took legitimate action for social causes by launching a nonprofit, SafetyNest

Branch gives optimism that with disciplined growth and realistic path to profitable premiums that founders will still be able to raise capital. But -will they? Keep watching...

The BFD

Three months after announcing it would make a big push into software and enterprise, fintech giant Brex confirmed that it is apparently abandoning a segment it started out to serve — small- to medium-sized businesses.

Confusion reigns: Initially there was some confusion as to what that meant. SMBs like brick-and-mortar businesses? SMBs as in startups?

Why this is the BFD: Brex has chosen to no longer work with any businesses that do not have some sort of “professional” funding — either venture capital, angel money or funding from an accelerator. As a result, “tens of thousands” of businesses were told their accounts would be shut down as of August 15. Furter reducing their ability to acess working capital across their businesses. As one SMB owner said - "Small business owners need a lending hand now in these times of uncertainty, not being ditched like this.” Brex, which started its life focused on startups, “remains committed to startups.” Is that true?

Moving forward:

But at the same time, the move maybe shouldn’t be as shocking as it was. Here’s why. In March, the company made a big deal about how it was entering the software business and focusing more on acquiring enterprise customers, like DoorDash.

Historically, Brex has made most of its money on interchange fees, which many would argue are low margin, so a move to a SaaS model could make sense. It would especially make more sense when the macroenvironment has shifted so much since Brex last raised and was valued at $12.3 billion.

M&A

NerdWallet (Nasdaq: NRDS) agreed to acquire On the Barrelhead, a Durango, Colo.-based lending recommendation platform, for $120m in cash ($70m) and stock. More here ->

Pine Labs, an Indian e-commerce and payments startup, acquired Indian embedded finance startup Setu for around $75m in cash and stock, per The Economic Times. Setu had raised a $15m Series A round. More here ->

Fintechs

AlgoPear, a Dallas-basd trading platform that provides short-term retail investors with algorithm strategies, raised $2M in seed funding. The platform aims to “democratize investing” by removing investment barriers to financial freedom for all income sectors. More here ->

Kickfin, paymet software that helps in sending tips directly to employees' bank accounts, raised an $11M Seed Round. Its software sends cashless tips to the employee’s bank of choice in real-time. More here ->

Tapcheck, an LA-based earned wage access company, raised $20m in Series A funding. Free for businesses, Tapcheck uses an intuitive app to let workers access their earned wages whenever they want. More here ->

Kasheesh, a New York-based startup that lets users split online payments between debit and credit cards, raised $5.5m. Consumers with low FICO scores or limited spending power “are often excluded and hit the hardest with negative restrictions (i.e. impact on credit score) on what they can buy and what rewards they get for using specific cards. Kasheesh believes consumers “should have tailored financing options on purchases versus being forced to select just one source of available funds.” More here ->

Narmi, a New York-based digital banking startup, raised $35m in Series B funding.  Narmi isn’t a bank, it provides mobile, online and digital account banking to regional and community financial institutions through "its API-driven platform that grants financial institutions access to Narmi’s many products to drive growth, deposits, and cost efficiencies.” More here ->

Metropolis, an LA-based developer of payment infrastructure for parking facilities, raised $167m in Series B funding.  The platform "powers more than 600 parking facilities, we have more than 1.8 million users, and we connect both to thousands of surrounding restaurants, coffee shops and retail stores in more than 60 cities.” More here ->

PayCargo, a Coral Gables, Fla.-based freight payment platform, raised $130m in Series C funding. The company offers a payments and data insights platform for logistics companies. More here ->

Auxilius, a New York-based financial planning and analysis platform for clinical trials, raised $10m. What Auxilius has built is an FP&A (financial planning & analysis) and accounting product “built from the ground up” to manage the complexity of clinical trials. More here ->

Able, a commercial loan enablement startup, raised $20m in Series A funding. “Able cuts the time and resources needed to process any business loan. Lenders get better economics and a scalable platform for growth. Everyone gets a modern digital experience. It’s a win-win situation for all parties involved.” More here ->

Middesk, a startup developing a platform to streamline and automate business verification and underwriting processes, has raised $57M in a venture round. Middesk’s “identity-as-a-service” APIs can be used by banks, insurers, credit card companies, lenders, payment firms, payroll companies and other service providers to automate onboarding in regulated industries, specifically for business customers. More here ->

Finhay, a Vietnamese digital investment platform, raised $25m in Series B funding. Finhay was founded in 2017 with the purpose of providing Vietnamese consumers with easy and convenient digital access to financial services. It is a licensed brokerage company and currently the leading online investment platform in Vietnam with more than 2.7 million users. More here ->

Destaxa, a Brazilian payments platform, raised a $3.1m in seed funding. The company operates as a two-sided marketplace for payment acquirers and offline merchants in Brazil. More here ->

Mast Technologies, a London-based mortgage origination platform, raised £1.2 million. Mast has built a cloud-native origination platform that promises to put an end to the days of borrowers waiting up to 60 days to receive an offer on their mortgage application. Launched in November, the technology has so far helped to process over £50 million of applications. More here ->

Webio, an Irish developer of chatbots for the credit, collections and payments markets, raised $4m in Series A funding. Pitched as a platform that makes ‘difficult’ customer conversations easy and personalised, Webio aims to help credit-based financial services make their customers – who may be in distress due to money-related issues – feel comfortable without human intervention. More here ->

Flip, an Indonesian consumer payments platform, raised $55m in Series B funding. Tencent led, and was joined by Block and insider Insight Partners. Flip has helped over 10 million people in Indonesia to access financial transactions, enabling users to send money from Indonesia to more than 45 countries. More here ->

MFS Africa, the Pan-African digital payments network, has rasied additional equity and debt capital to take its Series C to $200M. MFS Africa, known for its acquisition-led expansion plays, just last week acquired U.S.-based Global Technology Partners (GTP) in a cash-and-shares deal worth $34 million. More here ->

Mono, a startup that aims to be ‘first bankingless bank’ for Latin America’s small businesses, has come out of beta. Mono is building a fully digital bank with accounts that can be opened in around 15 minutes versus an average of two weeks at an incumbent bank. Mono operates with a local banking partner in Colombia and is building its own tech stack. It currently offers bank accounts with physical and virtual debit cards, the ability to make and receive wire transfers and make payments. More here ->

Stashfin, a Singapore-based neobank, raised $70m in Series C equity funding. The company also secured $200m in new debt funding. Stashfin provides under-represented parts of the society – such as blue-collared workers, individuals aged between 23 to 38 making less than $500 a month — credit line cards. The startup’s third market segment is armed force. More here ->

Fido, a Ghanian mobile credit startup, raised $30m in Series A equity funding. Fido told TechCrunch that it is planning to add savings and payment products to its portfolio later this year, and to enter Uganda, its second market, as it prepares to expand to more regions across the continent. More here ->

Upvest, a Berlin-based investment API provider, raised $42m in Series B funding. Fintechs and banks can use Upvest’s ready-to-go APIs to offer their end customers investment products including exchange-traded funds (ETFs), stocks and crypto assets, instead of having to build them in-house. More here ->

Opn, a Japanese mobile payments startup, raised $120m at a $1b valuation. Opn designs software that helps merchants set up payments on their mobile or desktop websites. Its biggest market is Thailand More here ->

SumU, a payments and business technology company, has raised $624M at $8.5B valuation. The London-based firm has expanded into a wider range of business services that are used by some 4 million small and medium businesses in 35 markets. More here ->

UK-based fintech start-up Hokodo announced that it has secured $40 million in a Series B funding round. Hokodo provides business-to-business (B2B) merchants with real-time trade credit solutions. More here ->

Cube, which wants to help finance teams plan better and faster, has landed $30M in funding. The company wants to help companies’ “plan their financial futur has seen seeing 400% ARR growth. More here ->

Crypto

Nume Crypto, a crypto payments processing startup, raised $2m. Nume Crypto is founded by two Indian sisters — Madhumitha and Niveda Harishankar — who aim to boost the use of crypto for payments. More here ->

FTX agreed to acquire Bitvo, a Calgary-based crypto exchange. More here ->

FalconX, a San Mateo, Calif.-based cryptocurrency exchange focused on institutional investors, raised $150m at an $8b valuation. More here ->

Roxe, a Hoboken, N.J.-based-based blockchain payments company, agreed to go public at an implied $3.6b valuation via Goldenstone Acquisition (Nasdaq: GDST), a SPAC led by Eddie Ni (Windfall Group). More here ->

Insuretechs

Pazcare, an Indian employee benefits and insurtech startup, raised $8.2m.  Pazcare currently offers health, term and accident insurance and outpatient health benefits. It monetizes from service providers through commissions. More here ->

Sana, an Austin -based health insurance startup, raised $60M in Series B funding. The startup, founded in 2017, says it has already grown its customer base by 200% over the past year. More here ->

Wefox, a German digital insurer, is in talks to raise Series D funding at a valuation of at least $5b (up from $3b last year), per Bloomberg. More here ->

Openly, a Boston-based homeowners insurance startup, raised $75m in Series C funding. More here ->

Overalls, a tech-enabled benefits company that combines concierge-like services with personalized financial protection to help people save time, moneysecures $4.6M in funding. More here ->

Laka, a London-based collective insurer for bike and e-bike owners, raised $1.5m in new Series A funding from Porsche Ventures (round total now $13.5m). More here ->

Proptech

Huspy, a Dubai-based online mortgage platform, raised $37m in Series A funding. Huspy wants to bring some streamlining and precision to how users access real estate products. Its platform features a suite of digital solutions for buyers, property agents and mortgage brokers. More here ->

Vergo, a New York-based financial platform for the homebuilding and renovation market, raised $4.1m in seed funding.  More here ->

Boston-based Openly, an insurtech homeowners insurer distributing through independent agents, has closed a $75 million Series C investment. More here ->

Brazilian digital real estate broker QuintoAndar launched last week in Mexico City, the first time the startup has expanded out of its home country. It will operate in the country under the brand “Benvi,” which will be the proptech’s international name. Last August, QuintoAndar announced it had raised $120 million at a $5 billion valuation. In April, the company laid off 160 people, or 4% of its staff — making it one of a few highly valued Brazilian startups cutting jobs. More here ->

Altrio, a Toronto-based provider of real estate investment software, raised C$8m in Series A funding. Its flagship product, Origin, is a deal management platform that provides insights into an organization’s investment pipeline, owned assets, and proprietary market knowledge. Origin’s users can manage equity and debt transactions in a number of different sectors across the Americas, Europe, and Asia. More here ->

HomeLight, an SF-based real estate marketplace, raised $60m in Series D extension funding led by Oren Zeev. It is also acquiring Accept.inc, a Denver-based lending startup backed by SignalFire. More here ->

Housecall Pro, a Denver-based software platform for home services companies, raised $125m in equity and debt funding from Permira and Vista Credit Partners. It declined to provide an equity/debt breakdown. More here ->

From the Stash

Why did Brex really decide to ditch SMBs? — techcrunch.com Last week was a true roller-coaster ride in the world of fintech.

Better.com loses three more senior executives, including SVP and VP of sales — techcrunch.com In the wake of its mass layoffs debacles, Better.com loses three more senior executives.

Tech layoffs analysis: late-stage startups are hit hardest — news.crunchbase.com In the brutal sweep of layoffs hitting U.S.-based tech companies this year, late stage startups have fared the worst, according to a Crunchbase News analysis of aggregated layoff data.

Fintech Amount, which was valued at $1B last year, lays off 18% of staff – TechCrunch — techcrunch.com Amount, a fintech which aims to help financial institutions “go digital in months — not years," and was valued at $1B last year, has laid off 18% of its staff.

A second wave of consumer BNPL startups is taking the model to new markets — techcrunch.com While these services could help consumers access pricey necessities — in the case of health or childcare — is it really a good idea for consumers to start paying off even more in installments?

Formerly rich NFT buyers party through the pain — techcrunch.com Welcome back to Chain Reaction. Last week, we talked about infinite pessimism in the crypto markets. This week, we’re talking about parties and tattoos and booze and fun. If you want to get this in your inbox every Thursday, you can subscribe on TechCrunch’s newsletter page. Exit opportunity It’s no secret at this point that […]

Reports / Webinars

Embedded insurance 101 with John Bean — www.youtube.com Embedded insurance is hot right now! It’s all about getting more relevant and personalised insurance to people when and where they need it the most. And is a...

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