Behalf Brings in Funding from Visa

Alternative small business lending platform Behalf has benefitted from its ties with Visa this week. The New York and Israeli-based company announced it landed an undisclosed amount of funding from the payments giant, marking Visa’s first investment in an Israeli company.

The investment will be added to Behalf’s previous total funding of $306 million in combined debt and equity. As part of today’s deal, Visa will have access to Behalf’s small business clients to market its tokenized Visa Virtual Card, a payment solution that offers businesses instant financing for business purchases. Visa will begin marketing the card in the U.S. and expand to more markets later this year.

“Our network of B2B merchants can fit Behalf seamlessly into their eCommerce flow, receive payment immediately and provide their business customers with more buying power and flexible payment options at checkout,” said Benjy Feinberg, Behalf CEO. “We are proud to partner with Visa with the goal of making purchases easier.”

The partnership is part of Visa’s strategy to promote its products through collaborations with startups and fits with the company’s commitment to invest up to $100 million in fintechs. Shahar Friedman, acting general manager for Visa in Israel, described small businesses as being “the backbone” of the global economy. “This partnership is a result of a close collaboration between the Visa Innovation Studio Tel Aviv and the dynamic Israeli start-up ecosystem to bring the power of the VisaNet global network to promising young companies in Israel such as Behalf,” he added.

Founded in 2012, Behalf offers short-term purchase financing for small-to-medium-sized businesses (SMBs). Unlike other alternative SMB lenders such as Kabbage or OnDeck, Behalf does not issue funds directly to the SMB. Instead, the startup pays the small business’ vendors on the SMB’s behalf. Having flexibility in repaying their suppliers helps merchants increase their production and ultimately grow their business.

Feinberg showcased Behalf’s vendor payment platform at FinovateFall 2014. Since then, the company has partnered with FinWise bank to offer SMB clients a broader range of financing solutions and, earlier this year, secured $150 million in debt financing.

Wonga Raises $13 Million in New Funding

 

Accel Partners and Balderton Capital have pitched in to help U.K.-based payday lender Wonga with a cash infusion of nearly $13 million (£10 million). The capital will be used to help Wonga satisfy what the company’s spokesperson called a “marked increase” in compensation claims for legacy loans from claims management companies.

“Wonga continues to make progress against the transformation plan set out for the business,” a spokesperson for the company said in a statement to Sky News. However, a rise in the number of claims on old loans, those taken out before the current management team took over in 2014, encouraged the company to seek additional financing.

“As a result,” the Wonga spokesperson explained, “the team has raised £10m of new capital from existing shareholders, who remain fully supportive of management’s plans for the business.”

Before the new capital, Wonga had an estimated valuation of $30 million (£23 million). In 2014, Wonga wrote off £220 million in debt for 330,000 customers as part of a review of its lending practices and the implementation of new affordability checks. The company has since attempted to diversify its business to include more flexible loan solutions such as its three- and six-month Flexi Loans. Rates remain high for Wonga products, with published representative rates north of 1,286% APR. Last year, Wonga also launched its Cash Smart personal finance education portal, which provides free information on debt and borrowing, savings, and budgeting.

To help shore up its balance sheet, Wonga has sold assets like its Everline business to small business lender Ezbob. Last year, the company sold Billpay, the German online payment provider it acquired in 2013, to Klarna for $75 million.

Founded in 2006, Wonga demonstrated its iPhone app at FinovateFall 2010. Tara Kneafsey is CEO.

Zopa Raises More than $57 Million to Support Next Generation Bank

P2P lending pioneer Zopa has raised more than $57 million in funding (£44 million) to support the launch of its challenger bank. The financing represents the first part of its current fundraising round, according to a post at the company blog, and comes amid reported strong growth for the sector and the company – including full-year profitability in Zopa’s P2P business in 2017.

The company’s intention to join the challenger bank revolution was signaled when it applied for a banking license in 2016. With growing concern from regulatory authorities such as the Financial Conduct Authority over the appropriateness of loan-based crowdfunding and P2P lending as an investment for average investors, adding retail deposits via a challenger bank would provide additional funding support for Zopa’s operations.

And while the bank would be initially limited to savings products like deposit accounts, Zopa expects credit and unsecured debt products to follow soon thereafter. “We aim to be the best place for money in the U.K. and we believe that launching our bank is a key next step,” Zopa CEO Jaidev Janardana said. “It allows us to offer a wider choice of products and to help our customers make smarter choices with their money.”

Named to the Financial Times’ FT 1000 list of Europe’s fastest growing companies, Zopa announced a major milestone in February, when its investor community lent its three billionth pound to U.K. customers. Re-opening to new investors at the beginning of the year, Zopa also started 2018 by beefing up its executive ranks. The company added new Chief Financial Officer, Steve Hulme; Chief Risk Officer, Phillip Dransfield; and Chief Customer Officer, Clare Gambardella.

London, U.K.-based Zopa has now raised a total of more than $169 million in funding. The company’s investors include Bessemer Venture Partners, Northzone, Augmentum Capital, and Wadhawan Global Capital. Zopa is one of Finovate’s earliest alums, having demonstrated its platform at FinovateSpring 2008.

Gusto Brings in $140 Million, Doubling Valuation to $2 Billion

Payroll, benefits, and HR platform Gusto broadcast some news today with, well… gusto. The San Francisco-based company closed $140 million in Series C funding.

This brings Gusto’s total amount raised to $310 million and boosts its valuation to almost $2 billion. Joining existing investors in the round are MSD Capital (Michael Dell), portfolios managed by T. Rowe Price Associates, Dragoneer Investment Group, and Y Combinator Continuity Fund.

Josh Reeves, Gusto CEO and co-founder, said that the new investors share the company’s passion for “creating a world where work empowers a better life.” He added, “We chose these investors because they care about enabling small businesses with modern payroll, benefits and HR. There are millions of companies out there to help, and this is a long-term journey for us. We’re just getting started.”

Gusto will use the investment to enhance its payroll, benefits, and HR technology to add more direct-to-employee benefits that allow employees to manage how and when they get paid. The company recently unveiled a development along these lines with the launch of Flexible Pay, a solution that allows workers to choose a payday that works best for their cashflow situation, outside of their employer’s standard payroll schedule.

Henry Ellenbogen, T. Rowe Price New Horizons Fund portfolio manager, noted that Gusto’s expertise isn’t just limited to payroll. “We believe Gusto has an opportunity beyond the payroll category in which they have demonstrated leadership for the last six years,” He said. “The company has a strong and focused management team, and it has the potential to become much larger as it expands its efforts to employees who seek to improve their financial mobility and achieve greater personal prosperity.”

Gusto, which launched in 2012 under the name ZenPayroll and showcased its flagship payroll solution at FinovateSpring 2014, has been busy lately. Not only has the company expanded its client base to serve more than one percent of all employers in the U.S., the company also paired up with Xero earlier this month and in June launched a directory of accounting firms suitable for small and medium-sized businesses.

Microsoft, Nationwide Invest $12 Million in SME Lender BlueVine

Small business financing specialist BlueVine has raised $12 million in new funding. Combined with the $60 million investment the company picked up last month, BlueVine’s Series E amounts to $72 million, and takes the company’s total funding to $590 million. Of this amount, $185 million represents equity financing.

This week’s investment comes from Microsoft’s venture fund, M12, and the venture arm of insurance and financial services company, Nationwide. M12 partner Elliott Robinson praised BlueVine’s “market traction to date,” while Nationwide Ventures’ Erik Ross highlighted the funding as emblematic of Nationwide’s commitment to serving SMEs. “This investment aligns with our strategy to co-create value for our members to help them protect what’s most important and to plan for a secure financial future,” Ross said.

BlueVine provides working capital to small and medium-sized businesses, offering lines of credit up to $250,000 and invoice factoring up to $5 million. With rates as low as 4.8% and approvals as quick as 20 minutes, the company recently surpassed $1 billion in total funding volume.

“We had very limited resources when we began and we were up against bigger and more established competitors,” said BlueVine CEO and founder Eyal Lifshitz, who reflected on the company’s fifth anniversary as well as this week’s funding. He credited the company’s “cutting edge technology and product innovation” for its success and added, “these new investments will help us offer more financing to even more entrepreneurs.”

Founded in 2013 and headquartered in Palo Alto, California, BlueVine demonstrated its SME online lending platform at FinovateFall 2014. This spring, BlueVine partnered with cross-border payments specialist, Veem, to make the process easier and less expensive for SMEs. Named one of the top 360 entrepreneurial companies in the U.S. by Entrepreneur, BlueVine added Women in Fintech Powerlist member Ana Sirbu as its new Chief Financial Officer at the beginning of the year.

Flywire Raises $100 Million for Global Expansion

Global payment and receivables company Flywire closed on $100 million in funding to facilitate foreign currency payments. The Series D round brings the company’s total funding to $143 million.

The financing was led by Singapore-based Temasek. Bain Capital Ventures and F-Prime Capital also contributed. While Flywire declined to disclose its new valuation, Forbes noted that the amount is significantly higher than Flywire’s 2015 valuation of $100 million, but falls short of $1 billion.

Flywire, which is headquartered in Boston and has operations in the U.K., China, Japan, Singapore, Australia, and Spain, will use the funds to advance its technology and expand geographically. The company also plans to invest in marketing by cross-selling its existing client base to new cross-border payment solutions for healthcare and business.

Flywire originally launched as peerTransfer in 2011, when the company set out to facilitate international tuition payments at colleges and universities. While this flagship market makes up 80% of Flywire’s revenue, the company has since rebranded and expanded to tackle international payments for healthcare and businesses. Flywire’s platform processes billions of dollars in payments every year in over 120 different local currencies, connecting more than 1,400 businesses and universities with their customers.

At FinovateSpring 2011, the company presented its original tuition payment platform. In June, Flywire partnered with UnionPay International to provide Chinese students and patients with discounted foreign exchange rates on cross-border tuition and healthcare payments. A few weeks earlier, EY named Flywire CEO Mike Massaro a finalist for Entrepreneur of the Year.

StockViews Announces New Investment from Fuel Ventures

A new round of funding will help equity research innovator StockViews invest in AI technology and grow its team of analysts. The London, U.K.-based company will also use the capital to open an engineering office in Hyderabad, India geared toward developing AI-based solutions.

“Our focus will be applying AI technology to identify misplaced securities in the mid-cap space,” company COO and Co-founder Sandeep Bathina said. “We are developing research tools to perform in-depth evaluation in support of our analysts.”

StockViews did not disclose the amount raised in the round, which was led by Fuel Ventures, a firm that specializes in early stage investment. StockViews raised $640,000 in funding last summer which, at the time, boosted its total capital above $1 million.

“We are excited to have Fuel on board and look forward to working with them during this next phase of the company’s growth,” StockViews CEO and Co-founder Tom Beevers said. “This funding will help us to expand the number of in-depth investment ideas we make available to our growing client base.”

In addition to the funding news, the company announced the hiring of analyst Jamie Fletcher, previously of Sarasin & Partners. StockViews noted that additional analysts are expected to be brought on board in the third quarter of 2018.

StockViews demonstrated its StockViews Signal solution at FinovateSpring 2015. Signal aggregates the recommendations of the platform’s best-performing analysts into a singular buy or sell notification. Instead of merely crowdsourcing market wisdom writ large, StockViews’ technology enables traders and investors to “crowdsource alpha” instead, focusing only on those analysts with a track record of outperformance.

A graduate of Startupbootcamp Fintech’s London program, StockViews is currently based out of Level39, the technology accelerator at London’s Canary Wharf. The company was founded in 2014.

Personetics Scores Minority Stake Investment from United Overseas Bank

Cognitive banking innovator Personetics announced an investment from United Overseas Bank (UOB) last week. The amount of the investment, which adds to the company’s previous $18 million in equity funding, was not disclosed. But The Business Times reports that UOB now holds a minority stake in Personetics.

“Today, UOB becomes the first bank in Asia to join this revolution in digital banking,” Personetics Co-founder and CEO, David Sosna, said. He praised the Singapore-based bank’s vision and “its commitment to the financial well-being of its customers.”

With more than 500 offices in 19 countries and territories in the Asia Pacific region, UOB will leverage Personetics’ technology to extend its own machine learning and data analytics capabilities. Dennis Khoo, UOB head of regional digital bank and strategic initiatives, added that Personetics’ technology will also enable it to improve customer engagement and “design more innovative, responsive and responsible digital banking services.”

Personetics cognitive banking solutions power personalized real-time guidance for more than 15 million digital users. With a combination of machine learning, natural language understanding, and AI-powered predictive analytics, the company’s technology enables FIs to provide their customers with highly-relevant, personalized insights and actionable advice to plan for their financial futures as well as manage everyday financial challenges.

Partnered with six of the top 12 banks in North America and Europe, and serving more than 50 million customers around the world, Personetics’ solutions provide FIs with conversational self-service (Personetics Assist), predictive insights and advice (Personetics Engage), and algorithm-based money management (Personetics Act). The company’s technology has analyzed more than 29 billion transactions and personalized more than 4.8 billion customer interactions.

Headquartered in Tel Aviv, Israel, Personetics demonstrated its Personetics Anywhere chatbot solution at FinovateFall 2016. Last month, the company unveiled a new offering designed especially for digital-only and challenger banks. This spring, Personetics announced that Banca Transilvania, the second largest bank in Romania with more than 2.2 million customers, will add its technology to its internet and mobile banking platform. Personetics began the year teaming up with Israel Discount Bank to power the $48 billion institution’s new digital financial assistant, Didi.

OnDeck Scores $93 Million in Two Credit Facilities

Online small business lender OnDeck closed a pair of revolving credit facilities this week. The $93 million in asset-backed funds come from Credit Suisse, which contributed $55 million (AUD 75 million) to go to small businesses in Australia, and Crédit Agricole, which contributed $38 million (CAD50 million) for small business loans to Canadians.

“Securing cost-effective facilities that provide committed funding to support the loan growth of our international businesses reflects another step forward in the execution of our financing strategy,” said Ken Brause, Chief Financial Officer at OnDeck. “These two transactions provide additional capacity to support small businesses in Australia and Canada and help them to achieve their goals.”

OnDeck will use the Credit Suisse facility to refinance its loan book at a lower rate and to fund future small business loan originations. OnDeck will service the loans, which it will extend to OnDeck Australia and OnDeck Canada subsidiaries. The funds are expected to promote small business growth in Australia and Canada by burgeoning the amount of working capital available.

Both loans carry an initial weighted average interest rate of 5.6%. The Credit Suisse loan will mature in June 2020 while Crédit Agricole’s matures in June 2021. These credit facilities make a total of four funding events that the New York-based company has received this year, following a $100 million revolving credit facility and a $225 million securitization, both received in April.

Founded in 2007, OnDeck leverages its OnDeck Score that uses advanced analytics to make real-time lending decisions and deliver funds to small businesses in as little as 24 hours. Since launch, the company has deployed $8+ billion to customers in 700 different industries across the United States, Canada, and Australia. OnDeck demoed at FinovateSpring 2012 and gave a presentation at our developers conference, FinDEVr New York 2016.

Algomi Picks Up Investment from Euroclear

Fixed income liquidity matching innovator Algomi is the recipient of new funding courtesy of an investment from Euroclear Information Services (EIS). Existing investors Euronext, AllianceBernstein, and S&P Global also participated. The exact amount of the funding was undisclosed; the company’s previous total capital stood at $14 million.

“Our investment in Algomi is driven by client demand to access untapped liquidity pools,” Euroclear CEO Peter Holder said. “This venture represents an opportunity to transform our data into an asset to increase transparency and provide a substantial boost for global fixed income markets.”

Algomi’s fundraising comes just a month after the company appointed a new CEO, Scott Eaton, who was formerly EMEA COO at MarketAxess. In a statement, Eaton praised Euroclear as a “partner who understands the value of information and the importance of improving liquidity in the fixed income market.”

The investment will enable EIS to improve liquidity in the global fixed income market by leveraging Algomi’s bond liquidity matching system to make information about specific bond holdings available anonymously. Counterparties can use Algomi’s data aggregation tool, ALFA, to access Euronext’s Synapse Multilateral Trading Facility to query and trade these securities.

Writing about the funding news, Algomi Head of Marketing and Communications Tim Binnington noted this would help increase both trading opportunities and transaction volume in the more illiquid fixed income products, including corporate and government bonds. Algomi acquired ALFA from AllianceBernstein last May in a deal that gave AllianceBernstein an undisclosed, minority stake in the company.

Founded in 2012, Algomi demonstrated Honeycomb, its buy-side GUI at FinovateFall 2014. This spring, the company was included in the Tech Tour Growth 50 – its third year in a row making the list of top European private technology companies with a valuation of less than $1 billion. In 2017, Algomi was named to CB Insights’ Fintech 250 roster.