Fintech Highlights - 9/5/2023

Better.com had a bad week. Affirm had a very good week. Robinhood repurchases shares. LemFi raises a round. Here's what we've been watching this week 👇

Pinned to the Top

Better.com had a Miserable.com week.

Digital mortgage lender Better.com made its public debut on August 24. To no one's surprise, the stock wasn't exactly a hit with public investors. In fact, it was a resounding bomb.

As of Friday, August 25, the stock had closed a mere $1.19.

Shares of SPAC partner, Aurora, were trading at $17.45 on Wednesday, before Better.com officially went public. This is a company that two years ago had planned to go public at a $7.7 billion valuation.

Now, we knew Better. com's stock wouldn't exactly perform well. But I'm not sure anyone expected it to be hovering at a share price that gave Better.com a market cap of just $19.14 million.

The BFD

Shares of Affirm’s stock were trading up nearly 30% to just under $18 on Friday afternoon after the company released its fourth-quarter and fiscal year 2023 earnings.

Why this is the BFD: The company said it was exiting the year with achieving profitability on an adjusted operating income (AOI) basis and that its revenue was up 22% year-over-year to $446 million. And, as reported by CNBC, Affirm “also gave strong guidance for the fiscal first quarter, projecting $430 million to $455 million in revenue, versus analyst expectations of $430 million.”

Maybe pump the brakes? Third Bridge analyst Kevin Kennedy had a few thoughts on the results after interviewing a number of execs in the fintech space, telling TechCrunch that “even with generally positive results, it is hard to ignore Affirm’s continued operating losses and loss margins expanded more than 11 percentage points over the past year, resulting in a $2.6 billion accumulated deficit.”

On the plus side: Kennedy also noted that the Debit+ card product was “a step in the right direction, and will likely play a key role in the path to profitability by driving better monetization of existing users without the drag of marginal customer acquisition costs.” He said he was also particularly interested to see Affirm’s increased adoption in travel, equipment and auto industries. Lastly, he said: “Our experts believe Affirm’s future as a standalone business will be contingent on the company’s ability to develop and effectively cross-sell a wider spectrum of financial services products, as the BNPL offerings of major diversified tech players like PayPal, Apple and Cash App (Block) are becoming increasingly competitive.”

The big picture: Affirm’s stock is still trading lower than its 52-week-high of $27.26, but it’s more than double its 52-week-low of $8.62.

M&A

Yahoo acquires social investing platform Commonstock More here ->

Moniepoint cleared to acquire Kenyan fintech Kopo Kopo More here ->

Robinhood  said it will pay $605.7m to repurchase shares from an affiliate of Sam Bankman-Fried, via an agreement with the U.S. Marshal Service. More here ->

Marsh has announced its intent to acquire Honan Insurance Group, a distinguished insurance broker known for its proficiency in corporate risk, employee benefits, as well as strata and real estate insurance solutions. More here ->

JPMorgan Chase increased its stake in Brazilian digital bank C6 to 46% from 40%. More here ->

Lufthansa, the listed German airline, is seeking to sell insurance units Albatros and Delvag, per Bloomberg. More here ->

Trustly, a Swedish payments business owned Nordic Capital, acquired SlimPay, a French direct debit platform that had raised around $25m from backers like Prime Ventures. No financial terms were disclosed, but Bloomberg pegs the price at €70m.  More here ->

Credit Bank, a Kenyan lender, is planning to raise nearly $7m in what would be the Nairobi Securities Exchange's first IPO since 2014.  More here ->

Fintech

LemFi, an Oakland-based fintech focused on providing financial services to African immigrants, raised $33m in Series A funding. LemFi offers a multi-currency account for immigrants to hold, send, and receive money in both the currencies of their home country and that of their host country. Users can also send money to more than 30 countries.  More here ->

Pi-xcels, a Singaporean provider of digital receipt solutions, raised $1.7m. More here ->

Korea Credit Data, a financial and accounting platform for businesses, raised $75m at around a $1b valuation. More here ->

Nomad, a Brazilian fintech that enables users open U.S. bank accounts, raised $61m in Series B extension funding at a $300m pre-money valuation.  More here ->

OneID, a London-based provider of bank-verified digital identification services, raised £1m from ACF Investors. More here ->

Crypto

Maple Finance, a crypto lending platform, raised $5m. Maple Finance lets pool delegates and credit professionals spin up their very own credit facility on the blockchain, opening their services to different borrowers to pull from their pool. More here ->

Insuretech

Clearcover, the next-generation car insurance company, announced the launch of “Choice,” - its embedded insurance solution that provides a customisable end-to-end auto insurance integration for brands.  More here ->

Proptech

Rent Butler, a Chicago-based provider of tenant screening software, raised $3m led by RET Ventures.  More here ->

From the Stash

Starbucks lovers now have a new way to pay for their favorite beverages, sans phone. The contactless checkout method comes as the coffee giant works to move people through the drive-through quicker. More here ->

⛈️ Insurers are facing losses of more than $9 billion in Florida from Hurricane Idalia, UBS estimated. More here ->

Klarna boasts expansion and growth across Europe as smaller firms ‘dial back’ commitments - and speaking of Klarna, CEO Sebastian Siemiatkowski posted an engaging thread on X, detailing the challenges of “trying to hire and manage somebody that does something that you have no clue how to do.” More here ->

How fintech company Marqeta is using AI to help consumers - More here ->

Hadley launches mobile app to increase access to savings plans - More here ->

Treasury Prime partners with Liberty Bank - More here ->

Cross River Bank and Current launch credit-building product - More here ->

Engagement banking fintech Backbase partners with SavvyMoney - More here ->

Has the fintech revolution ignored older customers? - The fintech revolution has had much success with millennials and their avocados on toast…but has the industry done enough for those 60 and over? More here ->

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