PayPal Buys Rewards Platform in $4 Billion Deal

Payments titan PayPal is shelling out $4 billion today in a transaction to purchase Honey, an online shopping and rewards platform. The deal is PayPal’s 20th acquisition and closely follows the California-based company’s arrangement with GoPay last month that gives it a 70% ownership in the China-based company.

PayPal, which offers solutions for both end consumers and merchants, will leverage Honey to create a better experience for the end customer while giving its merchant clients a boost through increased sales and customer engagement.

Honey brings with it a network of 30,000 online retailers and 17 million monthly active users. PayPal will be able to engage with these shoppers while they are still at the beginning of their online purchasing experience. Leveraging access PayPal’s 275+ million active customers and network of 24 million merchant accounts, Honey will be able to scale up its user base considerably.

Calling today’s purchase as one of the “most transformative” in the company’s history, PayPal President and CEO Dan Schulman went on to praise Honey for its ability to improve the online shopping experience. “The combination of Honey’s complementary consumer products with our platform will significantly enhance our ability to drive engagement and play a more meaningful role in the daily lives of our consumers,” Schulman said. “As a partner of choice for our merchants, this is another way that we can help them build and strengthen their customer relationships, provide personalized offers, and drive incremental sales.”

Logistically, Honey will stay intact, maintaining its headquarters in Los Angeles. The company’s co-founders George Ruan and Ryan Hudson will continue to lead the Honey team, reporting to PayPal’s Senior Vice President John Kunze.

PayPal showcased its Instant Account Creation feature at FinovateFall 2012. The company has a market capitalization of $120 billion.

Pinkaloo Raises $1.25 Million for its Philanthropic Fintech Platform

Pinkaloo revealed this week it has raised $1.25 million in funding for its white label giving platform. Newly-minted Squadra led the round, marking the Baltimore-based venture capital fund’s second-ever investment.

Existing investors and new angel investors also contributed to the round, which brings Pinkaloo’s total funding to $1.8 million when combined with last year’s $550k seed round. The company will use today’s investment to support ongoing pilots with current bank partners, continue product investment, and grow its ADP Marketplace channel partnership to support the workplace version of its giving solution.

Pinkaloo’s Modern Giving solution, which CEO Gideon Taub showcased in a demo that won Best of Show at FinovateFall earlier this year, is a white-label solution that helps banks and credit unions facilitate charitable giving options for their accountholders. Through Modern Giving, users can round up their card purchases to the nearest dollar and donate their spare change, convert rewards points into charitable dollars, and invite friends and family to chip in to crowdfunding campaigns.

“This funding, along with the tractions that we are seeing with banks and the recognition from our Finovate Best of Show Award demonstrate that our product is helping companies drive their business forward,” said Taub. “We’re excited to be able to continue on our mission of helping clients build deeper relationships with their customers, employees, and communities.”

Pinkaloo’s platform echoes a larger philanthropic trend, spawned by end users’ increased interest in charitable giving. Recently, fintechs such as Meniga, Revolut, and Betterment have all launched programs to facilitate donations to humanitarian causes. As a standalone donation facilitation platform, Pinkaloo can help traditional financial institutions compete with fintechs on this level.

Founded in 2017, Pinkaloo has facilitated hundreds of thousands of dollars in charitable giving for the end users of its dozens of clients.

Signicat Inks Payments Verification Partnership with Twikey

A new partnership between verified digital identity specialist Signicat and Twikey will make it easier for merchants in Belgium and the Netherlands to accept digitally-signed SEPA e-mandates for recurring purchases. The arrangement will enable firms to reduce costs and improve efficiency by moving away from paper-based SEPA processes.

“By working with Twikey, we can offer a streamlined solution to the market where businesses are able to identify who they are dealing with online, build the mutual trust, and get an e-mandate for ongoing payments with their customers,” Signicat CEO Gunnar Nordseth said.

SEPA mandates provide an authorization that enables merchants to accept future and recurring payments for services such as rent and utilities. While such mandates have historically required consumers to make actual trips to the bank to sign paper authorizations, the partnership between Signicat and Twikey will allow consumers to sign SEPA e-mandates digitally.

Belgium-based Twikey enables businesses to better manage recurring payments to save money and time. Founded in 2013, the company’s technology also helps its customers get 70% to 97% of their invoices to recurrent customers paid in two days or less. Twikey founder Dominique Adriansens pointed to the growth in the company’s digital SEPA mandate business as a key reason for the partnership with Signicat.

“We have already more than 1 million consumers in Belgium and the Netherlands having signed SEPA mandates digitally,” Adriansens said. “In a lot of cases contracts need to be signed upfront and that’s where Signicat comes in.” He praised the company’s experience in deploying digital identity verification in Europe, calling Signicat “the ideal match for assisting companies in search of more digitalization.”

Signicat demonstrated a pair of digital verification solutions – Signicat Assure and Signicat Sign – at FinovateEurope 2017. As of this month, the company offers identity verification in 208 countries using identity document scanning, web-based video interviews, and NFC scanning of passports. Also this month, Signicat partnered with Swisscom Trust Services to integrate qualified e-signatures (QES) into its platform.

In October, Signicat introduced a handful of new platform capabilities, including a new interface and new third party integrations. Over the summer, the company purchased Norwegian digital identity firm, Idfy, one of the fastest growing digital trust companies in the region. Signicant also teamed up with open identity scheme for financial services, yes.com, earlier this year, helping streamline onboarding, authentication, and e-signatures for the German digital identity service.

Winner of the bobsguide’s Best Retail Banking System Integration Award – along with Rabobank – Signicat was acquired by Nordic Capital in April. Terms of the purchase were not disclosed. Prior to the acquisition, Signicat had raised $8.8 million in funding.

Finovate Alumni News

On Finovate.com

  • Signicat Inks Payments Verification Partnership with Twikey

Around the web

  • Citi goes live with Citi Global Collect, a new cross-border B2B payments tool.
  • Sezzle opens new office in Toronto, Ontario, Canada.
  • Finastra hires Lisa Fiondella as Chief Data Officer.
  • ZagTrader wins full certification for its market making technology from Bourse Kuwait.
  • Optimove extends partnership with multiplatform gaming service provider Funstage.
  • Revolut taps Pierre Decote as its new Chief Risk Officer.
  • Signicat teams up with Twikey on payments.

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.

More Than $1 Billion Raised by 21 Alums in Q3 2019

Finovate alums raised $1.1 billion in funding in the third quarter of 2019. The quarterly total represents a significant rebound over last year’s Q3 sum and is reminiscent of the third quarters from 2017 and 2015 in topping the $1 billion mark.

Previous Quarterly Comparisons

  • Q3 2018: More than $400 million raised by 19 alums
  • 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

As our list of the quarter’s top equity investments below reveals, the $460 million fundraising from Klarna in August represents a significant amount of this year’s Q3 total. The investment, led by Dragoneer Investment Group, gave the Swedish ecommerce innovator a valuation of $5.5 billion and the title of the largest private fintech in Europe.

Also noteworthy was the $200 million raised by San Francisco, California-based payroll, benefits, and HR platform Gusto. Along with a pair of new participants Fidelity and Generation Investment Management, Gusto’s investors boosted the company’s valuation to $3.8 billion in the third quarter. There must be something special about Q3 and Gusto; the company’s previous $140 million in funding led the quarter’s top investments last year.

Top Ten Equity Investments for Q3 2019

  • Klarna: $460 million
  • Gusto: $200 million
  • Trulioo: $53 million
  • Credit Sesame: $43 million
  • Numbrs: $40 million
  • HackerOne: $35.4 million
  • Flybits: $35 million
  • Sezzle: $30 million (IPO)
  • Scalable Capital: $28 million
  • Kyndi: $20 million

Here is our detailed alum funding report for Q3 2019.

July 2019: More than $354 million raised by 10 alums

August 2019: More than $554 million raised by six alums

September 2019: More than $148 million raised by five alums


If you are a Finovate alum that raised money in the third quarter of 2019, 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.

How Revolut and Mastercard Are Helping Fintech Do Good

Revolut and Mastercard have teamed up this month to help rebuild schools in Mozambique after they were destroyed by a cyclone this spring. The effort, which is timed with UN’s Universal Children’s Day, aims to raise $207,000 (£160,000) to help get children in Mozambique back to school.

Revolut accountholders are able to show their support by making an in-app donation to Save the Children. Revolut and Mastercard will match donations from Revolut Mastercard customers. The goal is to complete the fundraising by January 2020 so that the schools can be built in time for the school year.

The campaign is made possible by the Donation feature Revolut launched in July. The feel-good feature allows cardholders to set up a recurring payment, make a one-off donation, or round up their purchases to the nearest whole number and donate the spare change. In addition to partnering with Save the Children, Revolut also facilitates donations to WWF and ILGA-Europe.

This campaign is part of a larger philanthropic trend moving through fintech lately. Other fintechs facilitating charity efforts include Meniga, which recently formed a partnership with the UN to allow users to donate their cash-back rewards to fight climate change, and Radius (recently acquired by Kabbage) which launched its Data for Good campaign to help the company’s employees and customers give back to their communities.

Revolut debuted its digital banking technology at FinovateEurope 2015 in London where the company’s CEO and founder Nikolay Storonsky showed off the app’s money transfer capabilities that help users avoid banking fees without actually using a bank.

Last month, Revolut launched in Singapore and announced plans to make its products available in the U.S. in the next couple of months. And in early October the company tapped investment bank JP Morgan to conduct a $500 million funding round and issue it a $1 billion convertible loan. The loan will turn into shares if Revolut receives a U.S. banking license.

Keepabl Partners with ClauseMatch to Boost GDPR Compliance

Privacy-as-a-Service solution provider Keepabl has partnered with regtech company ClauseMatch. The collaboration will enable Keepabl to better manage policies and procedures in accordance with General Data Protection Regulation (GDPR) guidelines, as well as with U.K. Privacy in Electronic Communications Regulations (PECR). At the same time, ClauseMatch will use Keepabl’s GDPR SaaS solution to manage its own privacy governance and GDPR obligations.

“Maintaining policies and procedures properly is of major importance for managing your risk and governance – and being able to show good governance is key when you’re winning business or being audited by customer or investors,” Keepabl CEO and founder Robert Baugh explained. “ClauseMatch allows us to organize all of our policies, procedures and controls in a structured manner on a single platform, available for the next review cycle and compliance checks, in an auditable format with all the track records of who did what presented in a complete audit trail.”

ClauseMatch CEO and founder Evgeny Likhoded credited Keepabl’s technology for making ClauseMatch’s privacy governance “simple and efficient.” Headquartered in London and founded in 2012, ClauseMatch provides smart document management, including real-time document collaboration solutions, for banks and other FIs. A member of CB Insights Fintech 250 and an alum of Barclays accelerator program, the company began the year working with another Finovate alum, Revolut, to help the digital bank meet regulatory and compliance requirements as part of its expansion to Singapore.

“We’re delighted to onboard Keepabl onto the ClauseMatch platform to make their policy management collaborative and auditable,” Likhoded said of this week’s alliance. “Our partnership is a great example of mutually beneficial collaboration between two RegTech companies creating a richer ecosystem and greater clarity and value for customers.”

Keepabl demonstrated its GDPR Compliance Platform at FinovateEurope 2019. The technology provides financial institutions with the resources they need – such as Article 30 records, Data Map analysis, Breach Response, and Processor Management – in order to remain compliant with GDPR regulations. Founded in 2017 by a 13+ year veteran implementer of compliance programs for mid-market organizations, Keepabl accounts for the fact that compliance issues like GDPR are typically the responsibility of human resources, marketing or IT teams rather than specialists in privacy issues. To this end, the company offers a cloud-based solution that makes it easier for both large and small FIs to both meet their compliance needs and, importantly, demonstrate their compliant status to partners and regulators alike.

Keepabl’s partnership with ClauseMatch is the London, U.K.-based firm’s latest collaboration this fall. In September, Keepabl announced that data discovery service provider Folding Space would join its Privacy Stack, an initiative launched by Keepabl that helps businesses stay abreast of GDPR compliance and other regtech solutions. Also that month, Keepabl and regtech company Alpha Reply agreed to work together to offer Alpha Reply’s customers a “holistic, practical, and flexible GDPR compliance service.”

Finovate Alumni News

On Finovate.com

  • How Revolut and Mastercard Are Helping Fintech Do Good
  • Keepabl Partners with ClauseMatch to Boost GDPR Compliance
  • More Than $1 Billion Raised by 21 Finovate Alums in Q3 2019

Around the web

  • Gartner names Exagens a 2019 “Cool Vendor.”
  • Trulioo appoints Zac Cohen as chief operating officer.
  • Trustly reaches 100 live gaming brands with its Pay N Play player registration and verification product.
  • Tradeshift moves Bucharest team to larger office in Tower Center, announces plans to hire more staff next year.
  • Globitex taps Salt Edge for strong customer authentication.
  • After Belfast launch earlier this year, Signifyd recruits 63 people with plans to recruit 150 more over the next three to five years.
  • Revolut and Mastercard team up with Save The Children to support Universal Children’s Day.
  • The San Diego Union-Tribune names Jack Henry & Associates a top place to work in San Diego for the fourth year in a row.
  • CredoLab, Neener Analytics, and Vymo win finalist spots in the India FinTech Forum’s IFTA 2019 awards.
  • Chetu ranked as the number two of 50 top software development firms in the U.S.
  • Payments company VoPay teams up with Plaid to offer a new credit card alternative to consumers in North America.

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.

BlueVine Raises $102.5 Million in New Funding

In a Series F round led by ION Crossover Partners, small business banking and financing firm BlueVine has raised $102.5 million in new funding. The investment takes the company’s total equity financing to more than $692 million, and will help the Redwood, California-based fintech scale its end-to-end banking platform, BlueVine Business Banking.

BlueVine will also use the capital to develop integrations with the company’s financing offerings, such as its line of credit, invoice factoring, and term loan products. The investment will support the hiring of additional talent for the company’s engineering, product, and revenue teams, as well.

“This funding further validates our mission and will help democratize true business-grade banking for small businesses who have been underserved for so long,” BlueVine CEO and co-founder Eyal Lifshitz said. He highlighted the company’s BlueVine Business Checking Account, introducedlast month, which offers small businesses an intuitive financial management dashboard and a debit Mastercard, as well as 1% interest on balances and no monthly fees.

“The recent launch of BlueVine Checking demonstrates our commitment to revolutionize banking for small business owners with a full suite of services designed specifically to meet their unique needs,” Lifshitz said.

This week’s funding featured a sizable number of participants, including all of BlueVine’s current investors, as well as new investors MUFG Innovation Partners, O.G. Tech – Eyal Ofer’s VC, Vintage Investment Partners, ION Group, Maor Investments and other private investors. ION Crossover Partners’ Jonathan Kolodny praised the BlueVine for its “track record of success” and the variety of financing solutions it offers small businesses.

“We’ve been following the company closely since its early days,” Kolodny said, “and have witnessed the demand, and frankly the economic need, for BlueVine’s banking services.” He added that BlueVine was poised to “change the way small businesses manage their financial needs today and in the future.”

BlueVine demonstrated its small business financing solutions at FinovateFall 2014. More recently, the company hired former PayPal executive Brad Brodigan as its Chief Commercial Officer, and appointed former Xero VP Herman Man as Chief Product Officer. Over the course of the year, BlueVine has teamed up with a variety of institutions ranging from its collaboration with GovQuote to its partnership with recruitment industry solution provider Bullhorn.

Founded in 2013, BlueVine earned recognition from Growjo this fall as one of the fastest growing startups in California. Since inception, the company has provided more than 20,000 small business owners with access to more than $2.5 billion in financing.

Aerospike Raises $32 Million for NoSQL Data Platform

NoSQL data solutions firm Aerospike received $32 million in Series D funding today. The round is the company’s largest investment to date and brings Aerospike’s total funding to $78 million.

Triangle Peak Partners led the round, followed by existing investors NewView Capital Partners, Alsop Louie Partners, and Eastward Capital Partners. Triangle Peak Partners Co-founding Partner Dain DeGroff and NewView Capital Operating Partner Tim Connor will join Aerospike’s Board of Directors.

Aerospike will use the funds to expand its geographic presence into Asia Pacific, develop additional data infrastructure integrations, and grow partnerships. There is no updated valuation for the company, which was valued at $90.8 million in 2017.

“Companies are on a journey to convert unprecedented amounts of data into intelligence and push it from the core to the edge and gain a competitive advantage,” said John Dillon, Aerospike CEO. “Aerospike is the critical real-time data platform in a new stack of technologies underpinning this sea change, and our footprint continues to aggressively expand within enterprises as real-time transactions and analytics become more pervasive and mainstream.”

Founded in 2009, Aerospike delivers a NoSQL database for a range of industries, including advertising, ecommerce, financial services, and telecommunications. The technology stores petabytes of data that can be instantly accessed for real time decisioning.

The company, which counts Adobe, Wayfair, and Verizon Media as clients, has been growing at a rate of more than 50% year-over-year and has maintained a 95% customer retention rate for more than five years.

Aerospike is a five-time participant in our developers conference, having most recently presented at FinDEVr London 2017. During the presentation the company’s CTO and Cofounder, Brian Bulkowski, talked about rapid application design in financial services.