Author: David Penn

More Than $400 Million Raised by 19 Alums in Q3 2018

By David Penn Posted on
Categories: Funding, Fundings

After racking up more than $1 billion in funding last summer, Finovate alums secured more than $400 million in funding over July, August, and September of 2018. This year marked the second time in the past four years that a billion-dollar third quarter was followed the next year by a significantly less bountiful Q3 in terms of equity financing.

Interestingly, eight of our 19 fundraising alums in the third quarter did not disclose the amounts of their investments. And while this does not provide any specific clues to the exact amounts of equity financing involved, it is noteworthy that undisclosed investments in AdviceRobo and Personetics both represented minority stakes taken by KPMG and United Overseas Bank, respectively.

Previous Quarterly Comparisons

  • Q3 2017: More than $1 billion raised by 31 alums
  • Q3 2016: More than $500 million raised by 30 alums
  • Q3 2015: More than $1 billion raised by 40 alums
  • Q3 2014: More than $194 million raised by 17 alums

If Q3 represented a small step in the funding growth for our alums overall, it was a giant leap for the quarter’s top fundraiser, Gusto. The $140 million in funding picked up by the payroll, benefits, and HR platform in July nearly doubled the firm’s total funding, and boosted the company’s valuation to almost $2 billion.

And you’ve got to hand it to Bambu. The three million raised by the Singapore-based robo advisor pales in comparison to the capital raised by its fellow top ten alums in Q3. But Bambu is the only company in the quarter’s top ten to have won not one, but two Best of Show awards, once at FinovateAsia 2017 and again last month at FinovateAfrica 2018.

Top Ten Equity Investments for Q3 2018

  • Gusto: $140 million
  • Flywire: $100 million
  • Zopa: $57 million
  • ThetaRay: $30 million
  • Deserve: $17 million
  • SynapseFI: $17 million
  • Wonga: $13 million
  • BlueVine: $12 million
  • Cortera: $10 million
  • Bambu: $3 million

Here is our detailed alum funding report for Q3 2018.

July 2018: More than $285 million raised by nine alums

August 2018: More than $87 million raised by six alums

September 2018: More than $28 million raised by four alums

If you are a Finovate alum that raised money in the third quarter of 2018, and do not see your company listed, please drop us a note at research@finovate.com. We would love to share the good news! Funding received prior to becoming an alum not included.

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Motive Partners Acquires Majority Stake in Finantix

Motive Partners Acquires Majority Stake in Finantix
By David Penn Posted on
Categories: Finantix, Mergers & Acquisitions

Private equity firm Motive Partners will become a majority shareholder in Finantix, a provider of digital services for the private banking, insurance and wealthtech sectors, reports Antony Peyton of Fintech Futures (Finovate’s sister publication).

Financial details were not disclosed. Both firms are a bit vague but Motive will support the company and the founders (Ralf Emmerich and Alessandro Tonchia) in “extending the functional footprint of the product and in accelerating geographic expansion”. The latter means Europe, Asia and to enter the U.S. market.

Scott Kauffman, partner at Motive Partners, said Finantix has demonstrated its ability to create a “compelling product, bringing a leading technology platform to an ever-increasing set of blue chip clients”.

Finantix’s founders and the management team will continue to lead the company.

The company has over 250 staff in seven cities and a customer base in more than 45 countries. Some of its clients include Rothschild Bank, Crossbridge Capital, and DBS.

Motive Labs, the operational and technology team of Motive, will also work with Finantix.

Back in March, Finantix acquired Singapore-based Smartfolios, a creator of quant-enabled investment tools. No financial details in that deal as well.

As reported last year, Motive powered up and revealed its plans to invest in fintech firms in the U.K. and U.S.

According to its Form D filed with the Securities and Exchange Commission (SEC) in the U.S, Motive was looking to raise $150 million.

“Our mission is to back and build the next generation of financial technology businesses to transform markets, models and society,” the company said on its website.

Based in Venice, Italy, and founded in 1994, Finantix demonstrated its Banking Assistant solution at FinovateEurope 2013.

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BioCatch Brings Behavioral Biometrics to ACI Worldwide

BioCatch Brings Behavioral Biometrics to ACI Worldwide
By David Penn Posted on
Categories: ACI Worldwide, BioCatch

A new partnership between real-time electronic payment and banking solutions provider, ACI Worldwide, and behavioral biometrics specialist, BioCatch, will deliver better online and mobile fraud prevention to banking customers. Along with the advanced analytic capabilities of ACI Worldwide’s UP Payments Risk Management, BioCatch’s behavior assessment technology will help institutions better defend themselves and their customers from a growing variety of cyberthreats.

“As online and mobile banking proliferates, fraudsters are consistently finding new ways to infiltrate banks’ systems, creating havoc for consumers and businesses alike,” BioCatch CTO and founder Avi Turgeman said. “By using behavioral data to distinguish between a genuine customer and a fraudster – whether human or non-human – we are able to detect fraudulent activity in real-time and protect consumers.”

ACI Worldwide global director for Payments Intelligence & Risk Solutions Cleber Martins pointed to threats like account takeover, social engineering, and bots as the main obstacles for institutions that are attempting to provide “enriched customer experience(s).” He praised the way BioCatch offers “cost-efficient access to behavioral biometrics” solutions to enable banks to “further promote safety and loyalty through the online relationship with their clients.”

BioCatch demonstrated the Passive Biometrics/Invisible Challenges mechanism of its cognitive behavioral biometrics technology at FinovateFall 2014. The mechanism injects a dynamic, cognitive challenge during the user’s interaction with an app. The challenge is so subtle that the user responds to it without being aware that the challenge has occurred. This response helps define the user’s relationship with the app, providing a unique user profile that reduces vulnerability to a variety of cyber threats.

Founded in 2011 and headquartered in Israel, BioCatch has raised $41.6 million in funding, and includes Blumberg Capital, OurCrowd, and Maverick Ventures Israel among its investors. In October, the company announced that it was partnering with seven, tier-one Latin American banks in Brazil, Chile, Colombia, and Mexico. Earlier this year, BioCatch teamed up with ForgeRock, offering its behavioral biometrics solution as an integrated module to ForgeRock’s platform.

ACI Worldwide powers electronic payments for more than 5,000 institutions globally, including more than 1,000 of the world’s largest financial institutions and service providers. The company participated in our developers conference, FinDEVr Silicon Valley 2016, presenting Simple, Global, and Secure eCommerce Payments with ACI Worldwide’s Next-Generation API. The discussion focused on the technical challenges of payments integration and the value of using an end-to-end solution with integrated real-time fraud prevention.

Founded in 1975 and based in Naples, Florida, ACI Worldwide trades on the NASDAQ under the ticker ACIW, and has a market capitalization of $3 billion.

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Ohpen Migrates More than 400k Accounts in Partnership with Aegon

Ohpen Migrates More than 400k Accounts in Partnership with Aegon
By David Penn Posted on
Categories: Ohpen

Ohpen is making tech progress as it has migrated over 400,000 Dutch savings and investment accounts from Aegon to its core banking engine, reports Antony Peyton of Fintech Futures (Finovate’s sister publication).

As reported in April last year, financial services provider Aegon was partnering with Ohpen to develop a new platform for its Dutch services.

The firms said they are merging their domain knowledge within pensions and technology. Aegon will plug into Ohpen’s singular platform via a 100% API-based interface.

In the latest phase, Ohpen said this migration is in line with their previously communicated ambition to “build the infrastructure and architecture of the future”.

Chris Zadeh, founder and CEO of Ohpen, said it developed its cloud-based core banking engine “from scratch to ensure that the technology and processes actually work, all the time.”

After the completion of this migration, all accounts of clients with investment and (fiscal) savings products of Aegon Bank will be administered by Ohpen.

In other Ohpen news, last month it unveiled its Ohpen API Portal (OAP) in beta mode. In its view, IT and re-platforming projects in financial services have a “reputation of running over time and budget”.

The firm stays true to its name because when asked about wealthtech woes in the U.K. it was very transparent. In that exclusive report in November, it responded quickly and said it had made 19 staff redundant at its U.K. office due to the lack of action in the asset management space.

Ohpen’s Dutch operations appear to be unaffected by these U.K. job losses. As reported in an exclusive in July, LeasePlan Bank, the online savings bank based in the Netherlands, chose it to upgrade its whole core cloud banking engine.

Founded in 2009 and headquartered in Amsterdam, the Netherlands, Ohpen demonstrated its core banking platform at FinovateFall 2012. The firm has raised €40 million in funding and includes Amerborgh among its investors.

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Finovate Alumni News

By David Penn Posted on
Categories: ACI Worldwide, Bankjoy, Bill.com, BioCatch, Interactions, iSignthis, Klarna, Launchfire, Passport, PayNearMe, Payoneer, Token, TransferWise, TrueAccord

On Finovate.com

  • Interactions Partners with Next Caller for Phone-Based Threat Assessment.
  • BioCatch Brings Behavioral Biometrics to ACI Worldwide.

Around the web

  • Token to support PSD2 compliance and open banking capabilities for U.K.’s thinkmoney.
  • SafeAmericaCU’s switch to AI-powered technology from Bankjoy helps the $433 million asset FI to earn “Best Practices” honors from CU Journal.
  • TransferWise secures £65 million syndicated debt facility with NatWest, JP Morgan, and LHV Bank.
  • iSignthis plans for Australian neobanking license in 2019.
  • PayNearMe’s electronic payment volume grew by more than 25% month-over-month in the past year.
  • Klarna joins Shopify Plus Partner program to power merchants.
  • TrueAccord wins a Healthy Mothers Workplace Award.
  • Passport recognized as one of Charlotte’s fastest growing companies.
  • Launchfire wins gold Brandon Hall Group Excellence in Technology Award.
  • Bill.com selects Comdata as Virtual Credit Card Provider for B2B Payments.
  • TopTracker partners with Payoneer to allows free payments between companies and freelancers.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

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Fighting Financial Crime with Feedzai’s Risk Ledger

Fighting Financial Crime with Feedzai’s Risk Ledger
By David Penn Posted on
Categories: Feedzai

Leveraging machine learning and secure, federated data from its customer base and third-party vendors, Feedzai announced this week the release of its latest financial crime prevention solution, Risk Ledger.

Feedzai’s Risk Ledger uses the 30 million transactions processed by its system every day – including more than 100 different payment methods – to deliver a more accurate and comprehensive anti-fraud solution compared to siloed data offerings.  By processing such a wide range and number of data elements (i.e., cards, IPs, merchants, emails) along the full cycle of the customer journey (from onboarding to compliance), Risk Ledger provides anti-fraud and anti-money laundering defense for all members of the payment process from issuers and acquirers to merchants and networks.

“Our goal has always been to make it harder and harder for fraudsters to hide, while making it easier for businesses to serve their loyal customers without friction,” Feedzai Head of Product Saurabh Bajaj explained. “As our customer base across the world continues to grow, the network effect of all of that data will only make Risk Ledger stronger.”

Risk Ledger is the latest solution from Feedzai designed to help fight financial crime. In October, the company unveiled Feedzai Genome, which enables financial fraud investigators to use link analysis graph technology to visualize and identify complex financial crime patterns and take action in real time. Powered by Feedzai’s advanced AI, Feedzai Genome learns over time, keeping pace with evolving AML and fraud typologies.

“Fraud patterns are getting more complex as criminals continue to get more sophisticated to avoid detection,” Feedzai CTO and co-founder Paulo Marques said when the technology was introduced. “Feedzai Genome gives our customers a full picture of financial crime so that they can fight it more effectively.”

With $5 billion in transactions scored daily, Feedzai serves ten of the largest 25 banks in the world, protecting 200 million people against cyberfraud. The company has raised $82 million in funding and includes Data Collective DCVC, Sapphire Ventures, Citi Ventures, and Oak HC/FT among its investors.

Earlier this year, Feedzai introduced its AutoML technology, leveraging machine learning to automate many of the most time-consuming processes for data scientists fighting cybercrime. In July, the company teamed up with Credorax, an e-commerce focused commercial bank, to help merchants better defend themselves against fraud.

Named to the Inc. 5,000 Europe roster for 2018 this summer and honored with a spot on the Forbes Fintech 50 at the beginning of the year, Feedzai demonstrated its fraud prevention technology at FinovateEurope 2014. The company was founded in 2008 and is based in San Mateo, California.

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Finicity Automates Asset Verification for Princeton Mortgage’s SnapApp

Finicity Automates Asset Verification for Princeton Mortgage’s SnapApp
By David Penn Posted on
Categories: Finicity

Princeton Mortgage will leverage Finicity’s Verification of Assets solution to improve the loan origination experience for lenders and borrowers. The asset verification technology will be integrated into Princeton Mortgage’s digital mortgage platform, SnapApp, automating the asset verification process, reducing mortgage fraud, and speeding time to close.

“We’re thrilled to work with Princeton Mortgage and provide its customers with an innovative, paper-free and hassle-free experience,” Finicity CEO Steve Smith said. “As the leading financial data aggregator in the mortgage lending industry, we are always looking for partners who share our goal of transforming outdated loan origination processes into seamless digital experiences.”

Finicity demonstrated its credit decisioning solutions, including both its Verification of Income (VoI) and Verification of Assets (VoA) reports, at FinovateFall 2017. The Verification of Assets solution enables lenders to leverage bank validated insights to identify underwriting factors that can shave as many as six days off the mortgage origination process. VoA and VoI are part of the company’s innovations to help digitize the lending experience and bring the quality of information available via real-time bank data to the mortgage industry.

Princeton Mortgage’s SnapApp enables borrowers to apply, verify income and assets, access their credit information, run an automated approval and generate a pre-approval letter at any time, according to the company’s Sales Enablement Manager Nicole Gordon. “Borrowers want an effortless mortgage experience, and with our new SnapApp they get just that,” she said.

Headquartered in Salt Lake City, Utah, and founded in 1999, Finicity partnered with fellow Finovate alums Experian and FICO to launch the new UltraFICO credit score earlier this fall. The new solution is designed to help provide financing to borrowers with credit scores in the so-called gray area of the upper 500s and lower 600s. UltraFICO leverages the account aggregation capabilities of Finicity and Experian’s consumer credit data to give lenders a broader view of a borrower’s financial behavior – especially for those new to credit or with limited credit history.

Finicity has been busy making friends and forging partnerships this year. The company teamed up with Freddie Mac in October, Fidelity Investments and Capsilon in September, Capital One in August, and both SimpleNexus and Cre8tech Labs’ Lender Price in July. The deals ranged from credit decisioning integrations to secure data exchange and customer data security agreements.

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Avaloq and Cyber Infrastructure Firm Metaco Team Up with Gazprombank

Avaloq and Cyber Infrastructure Firm Metaco Team Up with Gazprombank
By David Penn Posted on
Categories: Avaloq

Banking technology supplier Avaloq and crypto infrastructure firm Metaco have partnered with Gazprombank, a Swiss bank, to implement their integrated crypto asset solution, reports Henry Vilar of Fintech Futures (Finovate’s sister publication).

The aim of this project is to provide banks and wealth managers with a solution for the management of client portfolios across all asset classes including cryptocurrencies.

Gazprombank, which is already an Avaloq client, aims to offer a cryptocurrency service to its clients in mid-2019.

The solution will integrate SILO, Metaco’s crypto-wallet management solution, within the Avaloq Banking Suite. The two firms are already familiar with each other as Avaloq has a 10% stake in Metaco.

It will also allow banking and wealth management clients to buy, sell and transfer crypto assets and currencies, without any need for a crypto-wallet or private key management.

Adrien Treccani, founder and CEO of Metaco, said: “We know that security and secure custody are of paramount importance and Metaco’s multi-signature support will make the solution fully capable for institutional use.”

Metaco’s HSM (hardware security module) ensures a “military security” solution for storing private keys and managing wallets and operations. The new solution will support a multi-signature system for transaction approval.

Avaloq demonstrated its double marketplace at FinovateAsia 2018 last month. The double marketplace is a new feature of the company’s ecosystem that brings the app store concept to banking. Headquartered in Zurich, Switzerland, Avaloq was founded in 1985.

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Finovate Alumni News

By David Penn Posted on
Categories: Avaloq, Avoka, Feedzai, Finastra, Finicity, InfoCorp, Outsystems, Sberbank

On Finovate.com

  • Fighting Financial Crime with Feedzai’s Risk Ledger.
  • Finicity Automates Asset Verification for Princeton Mortgage’s SnapApp.

Around the web

  • Sberbank joins BC Region and NSD in three-way repo deal using blockchain technology.
  • Avoka accepted into Symitar Vendor Integration Program, will integrate its Transact platform with Symitar Episys.
  • Infocorp spinoff Bankingly raises $5.25 million in Series A funding in round led by Elevar Equity.
  • Avaloq and cyber infrastucture firm Metaco team up with Gazprombank.
  • thinkmoney leverages Outsystems’ low-code platform to deliver new applications and features for its innovative current account offering.
  • Finastra opens new offices in Romania.

This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

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FinovateAfrica Best of Show Winners Announced

FinovateAfrica Best of Show Winners Announced
By David Penn Posted on
Categories: Bambu, Best of Show, FinovateAfrica 2018, OUTvest

The votes have been cast and tallied – and the winners of FinovateAfrica’s Best of Show awards have been named. Congratulations to Bambu and OUTvest!

Finovate’s first foray into the African fintech scene has been a huge success. The companies that demonstrated their technologies live on stage this week showed us innovations in everything from automated regtech and small business lending, to customer engagement and AI-enabled credit assessment.

Yet the two companies whose live demos made the greatest impressions on our FinovateAfrica audience were firms focused on one of fintech’s earliest – and most persistent – disruptions: the rise of the robo-advisor. For these companies, wealthtech is still fertile ground for fintech innovation. And improving the way individual investors and their advisors build and manage personalized, investment portfolios is as important today as it has ever been.

Bambu for its goal-based, white label robo-advisor offering that gives investors a natural and effortless experience in finding the right investment strategy for their client’s needs.

 

 

OUTvest for its hybrid robo-advisor that uses an evidence-based approach to help everyone build and mange their own investment strategy.

 

Notes on methodology:
1. Only audience members NOT associated with demoing companies were eligible to vote. Finovate employees did not vote.
2. Attendees were encouraged to note their favorites during each day. At the end of the last demo, they chose their three favorites.
3. The exact written instructions given to attendees: “Please rate (the companies) on the basis of demo quality and potential impact of the innovation demoed.”
4. The two companies appearing on the highest percentage of submitted ballots were named “Best of Show.”
5. Go here for a list of previous Best of Show winners through 2014. Best of Show winners from our 2015 through 2018 conferences are below:
FinovateEurope 2015
FinovateSpring 2015
FinovateFall 2015
FinovateEurope 2016
FinovateSpring 2016
FinovateFall 2016
FinovateAsia 2016
FinovateEurope 2017
FinovateSpring 2017
FinovateFall 2017
FinovateAsia 2017
FinovateMiddleEast 2018
FinovateEurope 2018
FinovateSpring 2018
FinovateFall 2018
FinovateAsia 2018

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Asseco SEE Joins NISP to Support PSD2 Implementation

Asseco SEE Joins NISP to Support PSD2 Implementation
By David Penn Posted on
Categories: Asseco

Banking technology vendor Asseco South Eastern Europe (Asseco SEE) has joined the NextGenPSD2 Implementation Support Programme (NISP), which supports banks and interbank processors throughout Europe in implementing the Berlin Group NextGenPSD2 Framework, reports Tanya Andreasyan of Fintech Futures (Finovate’s sister publication).

With this move, Asseco SEE aims to deliver assistance to banks regarding implementation and achieving compliance with all relevant requirements of the revised Payment Services Directive (PSD2).

Asseco SEE described the Berlin Group as “a widely respected, pan-European payments interoperability standards and harmonization initiative”. Its NISP initiative was formed with “a goal to help implementers achieve fallback exemption and reduce interoperability issues,” the vendor added.

It now has over 20 member organisations, with Asseco SEE being the first vendor to join. “Having Asseco SEE as a solution vendor and NISP member will significantly contribute to the diversity and bring added value to the support we can provide to help resolve any interoperability issues,” stated Dr. Ortwin Scheja, project lead of NISP.

Predrag Popović, Asseco SEE’s group product director, said the membership is a “great honor” for the company.

“With our know-how incorporated in the PSD2 Enabler solution, which fits the Berlin Group NextGenPSD2 Framework and enables full PSD2 compliance out-of-the-box, we are sure our participation will be of immense assistance to all NISP members enabling them to optimize their implementations, deliver maximum quality and have their questions answered,” he said.

The Asseco SEE Group is one of the biggest IT companies that develops and implements its own software solutions and services across South Eastern Europe and Turkey. It employs over 1,550 people and operates in 13 countries, covering a market of 176 million people and eight languages. The company’s offerings serve a number of industry verticals, including financial services, payments, public administration and telecoms.

Among its subsidiaries are Eastern European paytech firm Payten and Portuguese core banking software vendor Exictos (now known as Asseco PST).

Listed on the Warsaw Stock Exchange, Asseco SEE shared the Finovate stage with Telenor banka at FinovateEurope 2015. The first fully mobile online bank in the SEE region, Telenor banka demonstrated its mobile device loan offering powered by Asseco SEE’s ASEBA Multichannel Hub.

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FinovateAfrica Arrives in Cape Town

FinovateAfrica Arrives in Cape Town
By David Penn Posted on
Categories: FinovateAfrica 2018

With our first conference in Africa starting tomorrow, today is a day for final plans and preparations for our demoing companies. FinovateAfrica 2018, which kicks off Tuesday morning and runs through Wednesday, will feature more than a dozen innovative fintech companies from Africa and beyond who will demonstrate their latest technologies live on stage before our audience of industry leaders and professionals.

And while our demoing companies are busy practicing their pitches, remember that FinovateAfrica is more than just live fintech demonstrations. Both days of the conference will feature keynotes, panel discussions, and presentations on some of the most pressing issues in fintech such as open banking and digital transformation. FinovateAfrica will also feature several sessions and tracks on topics like social payments and leveraging technology to serve rural communities that are especially relevant to developing economies.

Find out more detailed information about our agenda at our FinovateAfrica event page.

FinovateAfrica will be held at the Westin Cape Town in Cape Town, South Africa. The venue is located at Convention Square on Lower Long Street, and is readily accessible by public transportation. The conference itself will take place on the Old Harbour Level, and begins promptly with registration, breakfast, and networking at 8:15am on both Tuesday and Wednesday. Please remember that FinovateAfrica runs on a tight schedule, so be sure to give yourself a little extra time to make sure you arrive promptly and don’t miss a thing.

And once you’ve arrived, join our FinovateAfrica community on our Knect365 event app. Search for “FinovateAfrica” once you are in the app to access our audience participation feature Sli.do, our Best of Show voting tool, our networking platform Brella, our attendee list and conference agenda, a floorplan of the venue, and more. If you have any challenges with the app, please reach out to us at info@finovate.com for help.

Tickets are still available. If you are planning to attend FinovateAfrica, but have not yet saved your spot, run – don’t walk – to our FinovateAfrica registration page and pick up your ticket today. We look forward to seeing you here in Cape Town!

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