Fintech Roundup: Will financial technology startups dodge the venture slowdown?

Welcome to the weekly FinTech-focused column.This will be published every Sunday, so be sure to put it in between posts. Equity podcast listen Alex Wilhelm, Natasha Mascarenhas And I riff everything in the startup!And when it officially becomes a newsletter on May 1st, sign up if you want it to hit your inbox directly. here..

March 25th, PitchBook 2021 FinTech Annual ReportIt was discovered that the fintech industry raised $ 121.6 billion last year. This is a 153% year-on-year increase in global VC transaction value. Alex and I plan to dig deeper into the report next week, which is a great lead-in to what I’m looking at today.

There has been a lot of talk lately about the slowdown in venture funding. But if last week’s mega-round at FinTech is any sign, the sector has proved that it could be quite outlier, at least for now.

Not surprisingly, it’s still worth noting that corporate spending and expense management startup Ramp has raised $ 200 million and secured $ 550 million in debt. Doubled that value To $ 8.1 billion.Not bad for a company that just started publicly A little over two years ago..

It also exclusively covered Jeeves’ $ 180 million Series C. The company’s valuation has quadrupled to $ 2.1 billion In half a year. Since leaving Stealth last June, I’ve been writing about Jives. $ 31 Million Stock And it was wild to see it grow. It also works in the areas of corporate spending and expense management, with a more global footprint and infrastructure components.In fact, it’s itself The first “cross-country, cross-currency” expense management platform. Jeeves has a presence in and aims to expand. Latin America, Canada, Europe. We are also looking at Southeast Asia, and potentially Saudi Arabia and Africa.

Another thing that both Ramp and Jives have in common is that in addition to the valuation surge, both companies are experiencing rapid growth. Unfortunately, like most private companies, neither startup shares a tough revenue. However, it does provide at least some metrics. According to Lamp, revenue in 2021 increased “in the first half of 10 times” compared to 2020, with a 7-fold increase in the cardholder base and a 15-fold increase in the user base. CEO Eric Glyman also said Ramp Annual payments exceed $ 5 billion.. Given that it makes money from each transaction, it’s no exaggeration to say that the ramp is doing well and is ramping up into an impressive revenue area. Meanwhile, Jeeves says revenue has increased by 900% since the September salary increase, and more impressively, the first two months of 2022 generated more revenue than 2021 as a whole. We have doubled our customer base to more than 3,000 companies, reaching approximately $ 1.3 billion in total annual transaction volume (GTV).

Is this market big enough for so many global players? I don’t know yet. But it will be fun to see how the race in space takes place. As my friend Alex, co-host of the Equity podcast, pointed out this week, these companies don’t seem to stop adding features or new products fast enough.For example, Brix Last week, it announced that it had provided $ 10 million in growth capital through venture capital to Zesty.ai, a leading provider of forecast data analysis in the climate risk sector. Brex launched a venture debt program in August last year as part of an effort to provide start-ups and mature companies with as many financial stuff as well. (Last year, I also applied for a bank charter, but eventually withdrew my application). Meanwhile, new players are also appearing.I recently wrote about a new company called Glean AIWas started by former OnDeck and Better.com CFO Howard Katzenberg. It aims to help businesses save money by using machine learning to analyze transaction terms, billing information data, redundant services, negotiation opportunities, and more. Such startups keep incumbents (relatively speaking) on ​​their toes.

It’s no exaggeration to say that the rapid pace of funding to support these initiatives is likely to continue as long as these start-ups continue to add what they can offer to others, as I explained. Be careful if you are showing rapid growth. Moreover.

It is too early to really determine if FinTech is really outliers or if transactions that started at the end of last year are starting to close when it comes to withdrawing global venture funds. In the second quarter, we will gain more insight into whether FinTech is actually experiencing or avoiding a slowdown.

In that regard, our amazing FinTech / Cryptographic Reporter Anita Lamaswamy I talked to Lightspeed Venture Partners Justin Oberdorf On this topic, and at least in his view, FinTech No Not affected by global slowdown. As a context, Overdorff joined Lightspeed in 2021 to help the team lead fintech practices. He told Anita:

Image credit: Self-proclaimed “Fintech Addiction” Justin Oberdorf / Lightspeed Venture Partners Website

There are quite a few market changes. Perhaps it hasn’t been downgraded yet, but what’s changing is that the round size is definitely shrinking. And the number of term sheets offered is decreasing.So when you look, you know, trade, and [founder] I usually planned to buy a $ 20 million Series A, but the market is telling me to raise $ 12 to $ 15 million. And instead of 8 term sheets, you get 2 of them. And that’s happening pretty clearly …Well, with that said, I think I still have a lot of appetite. [for fintech] Overall.

On the venture side, Oberdorf told Anita that he was listening.VC is “trying to make the money last longer”, so “it is unknown where the money goes”.

So if Overdorff’s observations are any sign, both startup founders and investors are working hard to make their dollars last longer as well.

Contents [hide]

• 1 Robin Hood Expands to Consumer Finance, Apple Strengthens FinTech Games
• 2 Funding
• 3 In other news
• 4 Funding

Robin Hood Expands to Consumer Finance, Apple Strengthens FinTech Games

In other notable news, Robin Hood said it was this week Launch of new debit card This allows you to invest in spare changes. As I discussed with my very talented colleague Sara Perez, this move is a concrete step for Robin Hood to expand beyond trade into more consumer finance sectors. It was important in that it showed. Sarah’s exact words are: “It’s a direct competition with other fintechs like Chime and P2P payment companies like Cash App and PayPal / Venmo that connect online customer accounts to physical payment cards.” The round-up feature is like Acorns. It also helps to passively increase customer investment. [with its savings app] And like Venmo does with cryptography. “

Another example of FinTech trying to do everything.

Meanwhile, as our friend protocol report, Apple is reportedly acquiring a UK open banking startup Credit admiration About $ 150 million. This follows the introduction in early February. New Tap to Pay feature For iPhone that turns the device into a contactless payment terminal. The tech giant clearly covers the territory of fintech.

Funding

As always, I haven’t run out of money around the world, but I must admit that this list feels shorter than in the last few weeks. Here are just a few examples:

In other news

master Card announcement Launching a new suite of open banking-led smart payment decision tools aimed at increasing friction and success rates in the payment ecosystem. Credit card giants called the move “one of the first significant technological developments that came out of the acquisition of Finicity.”

This article by our own Alex Wilhelm is linked to the story “Fintech is an outlier” from above. Forge’s public debut will bring new challenges to SPAC-led exits.. Forge operates a private share market — basically the equity of a unicorn startup. It was released via SPAC this week, gasping and actually making an impressive debut.

On March 24, Ora agreed to acquire Avail Finance, a financial services startup that serves the blue-colored workforce, as ride-hailing giants are trying to expand their financial services offerings. Said. Manish Singh, This work..

Just a few months ago Nevada’s first unicornLast week announced that JP Morgan Payments will be the leading processor of Play + transactions across online casinos, mobile sports betting, cashless payments at casinos and more. The company tells me: “The gaming industry has a notorious and clunky payment ecosystem that is stalled by regulations and casinos’ reliance on cash. But recently, technical, such as the siteline helping launch the world’s first casino. Has made great progress. Completely cashless infrastructure.. “

Talk Report that you are expecting to reach 1 million active customers this month. CEO and co-founder Bin Chen said: Using story cards, they are building credit history and gaining financial upward liquidity. I wrote about startups $ 32.5 Million Series B February 2021.

Last week, the BMO Financial Group and 1871 called for applications for a major fintech industry program for women-led start-ups nationwide. WMNfintech.. Applications for the 2022 program will be accepted until April 22, 2022.

In this Q & A with FinLedger, Morty co-founder Nora Apsel Discuss Traveling the online mortgage market, advancing comprehensive goals and plans. I talked to Nora earlier this year and the former engineer is very impressive. Her company raised $ 25 million in Series B in July 2021 with a $ 150 million valuation. In February, she told me that startup revenues have almost doubled since 2019, doubling last year alone.

Image credit: Nora Apuser / Morty

Funding

Speaking of FinTech women, Mila Ferrell, a founding member of Zoom’s product team, joined us last week. SelvinBecame the first female partner in an early venture capital firm. According to the company, in her new role, Ferrel “defines the future of work and forms the fintech infrastructure for the next decade and beyond.”

Image credit: Mira Ferrel / Selvin

Tishman Speyer, one of the world’s largest real estate developers, has secured a $ 100 million commitment for the first PropTech Venture Capital Fund, backed by the National Pension Service of South Korea and an investment management company in Ontario. Was announced. The venture says it is seeking to raise up to $ 150 million in total capital to fund its investment in “technology-driven opportunities related to all sectors of real estate opportunities.”

Well, that’s all for this week! My newsletter was scheduled to be published today, but for logistical reasons the date has been officially moved to May 1st. Have a nice Sunday.