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Monday Fintech Four

By Jim Bruene Posted on October 28, 2013
Categories: Mergers & Acquisitions, Mobile Payments, P2P Payments, Prepaid/gift cards

Editor’s note: This was supposed to be the Friday Fintech Four, which is much better alliteration. But alas, it didn’t get published, so here’s the belated Monday version.

<drum roll> Here are the four most surprising fintech developments of the past week (in no particular order):

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One: Stealthy mobile payment startup Clinkle hires long-time CFO of Netflix, Barry McCarthy, as its COO
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McCarthy was CFO from 1999 to 2010, taking Netflix public in 2003, then overseeing its finances as a public company for seven years. It’s pretty unusual for a big-name public company exec to take on an exec role at a startup, especially one in mobile payments. And one that hasn’t even officially launched yet to boot. McCarthy is on the board of three startups: Chegg, Eventbrite and Wealthfront, a startup in the investment space.
    >> LinkedIn profile of McCarthy
    >> A nice overview of the news at TechCrunch
    >> An interview with McCarthy at AllThings D

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Two: New mobile PFM, Level Money, beats Square Cash to #1 in iOS app store (finance)
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As soon as Square launched its P2P payments app, Square Cash, it quickly rocketed to number two in the Finance section of the iPhone app store (see Chart 1 below) and number 55 across all free apps in all categories. But it never got higher, and a week later it’s hanging in at number 11.

The reason it missed the top slot? Another newcomer, Level Money, a great-looking new PFM, was being featured by Apple in the App Store and maintained the top ranking during that period (see Chart 2). During its time as a promoted app, Level Money maintained a top-20 ranking among all 500,000+ free apps (see Chart 3).

>> Netbanker post on Square Cash
>> Distimo app rankings for Square Cash (see following chart)

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Chart 1: Square Cash app ranking in Free Finance in Apple App Store

Chart 2: Level Money app ranking in Free Finance in Apple App Store

Chart 3: Level Money ranking among all free apps in the Apple App Store

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Three: Amex customers have put $1 billion into its Bluebird prepaid card
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At this year’s SourceMedia Payments Forum, American Express revealed key metrics about its highly touted Bluebird prepaid program sold in Walmart stores:

1 million new accounts
$1 billion in total loads
Average load of $1,000 per account
87% of accounts new to Amex
53% over age 35

Thanks to the attendees who tweeted the metrics @leimer (Bradly Leimer) and @JimMarous among others.

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Four: Four fintech startups snapped up last week
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Compared to other tech sectors, fintech has experienced less M&A activity in the past few years. Everything moves a little slower in a highly regulated, fraud-magnet segment. Buying fintech is not like bolting on a photosharing app. That said, it was a busy past 10 days on the M&A front:

Betterment buys ImpulseSave to boost its auto-savings features (Finovate post)
UK’s FundingCircle buys Endurance Lending to enter U.S. market (Techcrunch)
Blackhawk acquires Intelispend (Digital Transactions)
Wonga buys Germany’s BillPay to expand outside United Kingdom (Techcrunch)

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Photo credit: Fab Festival

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FinovateAsia 2013 Sneak Peek: Part 3

By David Penn Posted on October 28, 2013
Categories: FinovateAsia 2013, FinovateAsia 2013 Sneak Peek

Still just getting to know the companies that will be presenting at FinovateAsia 2013 in November? Here are another five fintech innovators scheduled to take the stage next month in Singapore.

And if you missed the previous two installments of our Sneak Peek preview, check out the links below.

FinovateAsia 2013 Sneak Peek: Part 2

FinovateAsia 2013 Sneak Peek: Part 1

Our final event of 2013 is only a few weeks away. For more information about how to join us in Singapore, visit our FinovateAsia 2013 page here.

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Arkalogic’s latest innovation, Moneta, enables customers to have a seamless and secure payment system that caters to their key daily transaction needs, in one platform.

Features:

Mobile payments and banking platform
Seamless and secure transaction experience
Comprehensive end-to-end solution for cashless transactions

Why its great:

Transactions and life should be simple and secure. Always. With Arkalogic’s latest innovation, Moneta, it’s as if carrying your ATM and wallet in your mobile device.

Aryo Karbhawomo

Visionary Entrepreneur, Founder and CEO, Arkalogic

PhD in Computer Science, University of California, Berkeley

John Subroto Chard (pictured)

Strategy & Finance Advisor, Arkalogic

MBA, New York University. Expertise in corporate development, start-ups and corporate strategy. Previously with McKinsey.

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BRIDGEi2i Analytics Solutions‘ cloud-based application, Surveyi2i, enables business users to unearth hidden patterns and share holistic insights from survey data in just a few clicks.

Features:

Zero in to key insights in matter of hours
Single tool for analyzing both quantitative and unstructured textual inputs
Design, automate and share dashboards without a single line of script

Why it’s great:

It makes the process of analyzing survey data incredibly faster, easier and cheaper.

Prithvijit Roy

CEO and Co-founder, Bridgei2i

Known among the pioneers of the analytics industry in India, Prithvijit has experience building and leading large scale analytics centers for Hewlett-Packard and GENPACT.

Pritam Kanti Paul

Business Analytics Entrepreneur, Bridgei2i

Known as an innovative thinker, Pritam has led development and implementation of several high impact and cutting edge analytical solutions for Hewlett-Packard and General Electric.

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Luminous is the ultimate financial innovations company with visionary products that are breakthrough in sheer simplicity.

Features:

Electronic safety deposit box
Banking customers can upload, sort and store personal and business documents
Ability to back up and save the most recent version of important documents

Why it’s great:

Banking customers can upload, sort and store personal and business documents.

Warren Bond

CEO, Luminous

Andrew Teversham

Chief Technology Officer, Luminous

Andrew heads up the development and implementation teams at Luminous and has gained extensive experience with SAP implementations over a number of years.

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Matchi is a global community innovation platform for the banking industry that offers market ready innovations from across the globe.

Features:

Unprecedented collaboration opportunities for banks
Marketing platform for innovators to showcase their innovations to banks
A go-to-destination for market-ready, banking innovations online

Why it’s great:

An innovation matchmaking site for banks globally

Paul Steenkamp

Head of Innovation, First National Bank

Warren Bond

CEO, Matchi

Warren is constantly looking for new ideas and ways to drive innovation and change in the banking industry.

Gerrit Hoekstra

CTO, Matchi

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Mobino aims to enable mobile payments for 5 billion people. The company was founded by J.F. Groff, one of the creators of Web technology.

Features:

Total independence from credit cards and telcos
Local and international payments, in-shop, peer-to-peer and e-commerce
Universal access from smartphones and dumbphones

Why it’s great:

Banked or unbanked, online or offline, privately or for business, Mobino lets everybody move money simply and efficiently.

Jean-Francois Groff

CEO, Mobino

Jean-Francois was one of the architects of the Web firm CERN. Mobino, his fourth startup, is guided by a lifelong passion: making technology serve humanity, not vice versa.

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Be sure to catch the fourth installment of our Sneak Peek preview of FinovateAsia 2013 next week.

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App Store, Configurable Notifications Featured in Next Generation of Bill.com’s Banking Platform

By David Penn Posted on October 28, 2013
Categories: Bill.com

Bill.com announced today its new, “next-generation” banking platform that works to return banks to their role as “the focal point of all their customer’s transactions.”

The new platform is geared toward solving two specific problems for banks and their clients: monetizing cash management and helping small and medium-sized business integrate and automate their financial processes.

Among the key new features of the platform is the App Center. This resource makes it easier for businesses to tap into and integrate a variety of third party applications. These apps include everything from document digitization and expense reporting solutions to major accounting systems like Sage, Xero, and QuickBooks. The ability to connect multiple third party apps and integrate them via the App Center enables banks to offer a number of cash flow management solutions to their business clients.

Improving communication via configurable notifications is another goal of the new platform. Being able to set-up and control the kind of information and approvals that are issued on an account-to-account basis means better, more personalized and efficient service for businesses. And for banks? Said Bill.com founder and CEO René Lacerte, “The more banks can offer their customers to make their lives easier, the more loyal and happy their customers will be.”

Headquartered in Palo Alto, California, Bill.com has been a Finovate alum since 2010, and last demoed as part of the FinovateSpring 2011 show.

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Payfone Brings in $10 Million from Early Warning Systems

By Julie Muhn (@julieschicktanz) Posted on October 28, 2013
Categories: Payfone

Mobile security and authentication technology is always a topic of importance in fintech because fraud threats are continuously evolving.

Mobile commerce and authentication company Payfone announced this month that it raised $10 million, further proving that the need for mobile security technology will be around for awhile. The funding comes from Arizona-based Early Warning, and brings Payfone’s total funding up to almost $40 million.

As a part of the deal, Payfone’s technology will be available to Early Warning’s clients.

To learn more about Payfone, watch its FinovateFall 2012 demo where it launched 1 Touch Checkout.

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Finovate Alumni News– October 28, 2013

By Julie Muhn (@julieschicktanz) Posted on October 28, 2013
Categories: Kony Solutions, Locaid, Swipely, TipRanks, Tyfone, wipro

Swipely named one of America’s top job creators with 2013 ‘Hire Power’ Award from Inc. Magazine.

Wipro launches Mobility Center of Excellence with Kony in Hyderabad.

Tyfone trials smart card-based mobile banking security.

Locaid CEO Rip Gerber talks location verification services in new interview.

TipRanks launches Windows Phone mobile app.

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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SEC’s Recent Vote May Ease Operating Restrictions for Nine Finovate Alums

By Julie Muhn (@julieschicktanz) Posted on October 25, 2013
Categories: Bolstr, CK Mack, LendStreet, Motif Investing, P2BInvestor, Realty Mogul, Rebirth Financial, SeedInvest, SoMoLend

The U.S. Securities and Exchange Commission (SEC) this week unanimously voted to approve the proposed rules that will govern online crowdfunding. Under these provisions, companies will be allowed to offer and sell securities through crowdfunding.

Some of these companies have been waiting since early 2012, when Obama signed the JOBS Act, for the SEC to create the regulation, which is intended to protect private, non-accredited investors.

Investors who earn under $100,000 per year will be limited to $2,000 per year investment, or 5% of their income, and those who make over that amount will be limited to invest 10% of their income annually. However, in order to reduce burdens on the companies raising the funds, and the funding portals, the new regulation does not explicitly require them to verify the income of the individual investors.

According to the SEC’s press release, its proposed rules would require SEC-registered intermediaries (broker-dealers, funding portals) to:

Educate investors
Manage the risk of fraud
Provide information about the issuer and the offering
Furnish communication channels
Facilitate the offer and sale of crowdfunded investments

The proposed rules would prohibit them from:

Offering investment advice or making recommendations
Soliciting purchases, sales or offers to buy securities
Restricting compensation for solicitations
Holding, possessing, or handling investor funds or securities

Before the rules are passed, they must go through a 90-day comment period, after which, they may be altered to reflect the comments. Once the final rules have been decided, the nine Finovate alums below will be able to solicit to non-accredited investors, subject to the SEC’s final ruling.

Bolstr

Founded: 2011

FinovateFall 2012 demo

C.K. Mack

Founded: 2012

FinovateFall 2012 demo

LendStreet

Founded: 2010

FinovateSpring 2011 demo

Motif

Founded: 2010

FinovateFall 2013 demo

P2Binvestor

Founded: 2012

FinovateSpring 2013 demo

Realty Mogul

Founded: 2012

FinovateSpring 2012 demo

Rebirth Financial

Founded: 2010

FinovateFall 2011 demo

SeedInvest

Founded: 2012

FinovateSpring 2013 demo

SoMoLend

Founded: 2011

FinovateSpring 2012 demo

From an operational standpoint, life for these startups will be a bit easier after the SEC passes the provisions, since it will increase the number of investors on their platforms. They will, however, be faced with increased regulation, which Forbes estimates will cost more than $100,000 annually. This estimate includes procuring and offering disclosure documents, enlisting a funding portal, running background checks, and filing an annual report with the SEC.

The first provision of the JOBS Act, which allows companies to advertise to accredited investors, went into effect September 23.

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Flint Raises $6 Million in Series B Funding

By David Penn Posted on October 25, 2013
Categories: Flint Mobile

A big month for Flint Mobile just got a bit bigger with news that the mobile payments company just raised $6 million in funding from new and existing investors.

The round was led by Digicel Group, and included participation from Storm Ventures, SVG Partners, and True Ventures. Flint’s total capital raised stands at $9 million, which includes $3 million from a round completed in May 2012.

Flint plans to put the new capital to use by (1) adding new talent, (2) boosting customer acquisition efforts, and (3) accelerating R&D in the mobile payments space. Co-founder and CEO Greg Goldfarb said that Flint will remain “focused on empowering the ‘non-countertop’ businesses that operate outside of store (environment) and have different requirements (from traditional retail).”

Today’s announcement comes on the heels of news that Flint was releasing its Android app, and that the company had swapped out its card reader for a camera, as well. Goldfarb also noted that Flint had experienced transaction volume growth of more than 10x in less than year.

From some perspectives, Digicel Group may seem like an unlikely source of capital for Flint. Digicel is not especially active when it comes to funding startups, and has a role of its own as a global communications provider in more than 30 markets. That said, Digicel considers Flint to provide the kind of “pure digital app model” that represents an “inevitable market shift” in the way payments will be made in the future.

Founded in April 2011, Flint demoed its technology as part of the FinovateSpring 2012 show in San Francisco. See the company’s presentation here.

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Finovate Alumni News– October 25, 2013

By Julie Muhn (@julieschicktanz) Posted on October 25, 2013
Categories: CardFlight, Flint Mobile, InComm, ShopKeep POS, Taulia, TransferWise

CardFlight wins best startup at New Jersey Tech meetup.

Firmology interviews Jason Richelson, CEO of ShopKeep POS.

Humanitarian organization Oxfram partners with TransferWise to help British Indians avoid fees.

InComm launches Cashtie cloud match service.

Flint raises $6 million in Series B funding.

Taulia was recently announced as a 2013 Bully Award winner.

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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Payments, Mobile, Security, Social: A Look Ahead to FinovateAsia 2013

By David Penn Posted on October 24, 2013
Categories: FinovateAsia 2013

How many ways will the presenters of FinovateAsia 2013 express “innovation in fintech” this year?

Finovate returns to Singapore on November 14th for a one-day showcase of the latest in financial technology. And many of the themes that have defined the fintech conversation in 2013 will be well-represented at this year’s event:

Mobile

From banks looking to onboard college students on campus to merchants making transactions in the field, companies are focused on providing superior mobile user experiences.

Payments

Lower costs and greater efficiencies remain key goals. Minimize friction. Maximize security. Reduce cart abandonment. Increase and personalize customer engagement.

Security and Social

Acquisitions in the security space and the headline-grabbing IPOs of social media startups suggest major rewards for those companies able to make the marriage between what’s public and what’s private work for everyone.

Register here and join us November 14th for FinovateAsia 2013. And if you’re looking for more information about our upcoming event in Singapore, visit our FinovateAsia 2013 FAQ page or email us with your questions at asia@finovate.com.

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Are Utilities Ready for Mobile BillPay? Industry Leaders Weigh-in via Check Survey

By David Penn Posted on October 24, 2013
Categories: Check

Check surveyed* more than 50 utility company professionals in October, asking them about their utility’s mobile billpay strategy.

Or lack thereof. The survey revealed that only 25% of the respondent’s utility companies provided mobile bill pay options for their customers.

But what may be most interesting about the survey are the aspirations that utility company professionals have and challenges they see when it comes to broader adoption of mobile billpay technology. Consider the responses:

Among those professionals who wanted a mobile billpay option, the reasons why were:

51% – To reach customers more effectively through their preferred channel
24% – To decrease billing costs, including paper costs
18% – To increase customer engagement
7% – To collect money faster and optimize cash flow

Asked for the top challenges to broader mobile billpay implementation in the utilities industry, the same professionals responded:

47% – Vagueness and/or uncertainty about the company’s mobile strategy
29% – Lack of IT resources and/or IT prioritization
17% – Budget
7% – Security and/or compliance concerns

Overcoming these challenges involves building business cases that examine the risk/reward of partnering with existing mobile billpay companies on one hand, and building or buying their own billpay solutions on the other hand. In reaching out to bring mobile billpay to more utility consumers, Check has partnered with Desert Water Agency, Irvine Ranch Water District, and Alltel.

Formerly Pageonce, Check demoed its technology at FinovateSpring 2010 in San Francisco. The company announced the addition of expedited payments in June, and successfuly completed a $24 million dollar Series C funding round in September.

* Check conducted its online survey in October 2013. The survey included responses from 57 utility company professionals whose firms serve more than 2 million customers.

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Finovate Alumni News– October 24, 2013

By Julie Muhn (@julieschicktanz) Posted on October 24, 2013
Categories: Blackhawk Network, Check, FinovateAsia 2013, Fiserv, Guardian Analytics, Lending Club, Locaid, Manilla, PayPal, SeedInvest

Fiserv to offer clients Guardian Analytics’ FraudMAP solutions.

Lending Club CEO, Renaud Laplanche, named a winner of Ernst & Young’s Venture Capital Award of Excellence.

PayPal and Blackhawk Network join forces to bring gift card services to the digital wallet.

Manilla User Survey: Consumers Want Bills in One Place and Banks with Bill Management.

Payments, Mobile, Security, Social: A Look Ahead to FinovateAsia 2013.

Are Utilities Ready for Mobile BillPay? Industry Leaders Weigh-in via Check Survey.

Locaid featured in American Express Open Forum column on attracting mobile customers with geofencing.

InfoTrends’ Matt Swain takes a look at Check.

SeedInvest “thrilled” by new rules proposed for equity crowdfunding.

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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Manilla User Survey: Consumers Want Bills in One Place and Banks with Bill Management

By David Penn Posted on October 23, 2013
Categories: Manilla

If the idea of having all your bills in one central location sounds good to you, then you’re not alone.

Respondents in a recent user survey* by account management specialist Manilla ranked this feature near the top of the “convenience scale” with it comes to handling bills.

For Jim Schinella, CEO of Manilla, this is evidence that “consumers value the ‘everything in one place’ paperless experience that Manilla provides.”

Consumers can use Manilla to manage household finances such as utility bills, subscriptions, and travel rewards programs. The technology is free, and can be accessed online at Manilla.com, as well as via iOS and Android mobile apps.

Other top metrics from the survey:

84% users prefer online statements to paper mail
70% of respondents use online bill pay
More than half of all users receive more than 75% of their statements electronically

How important should this be to banks? More than 40% of the respondents believed having Manilla integrated into their bank’s website would increase their bank bill pay use. Said Schinella, “from the beginning, we felt that Manilla’s powerful digital mail capabilities fit naturally inside a bank experience.”

Manilla was last on stage in September as part of FinovateFall 2013. The company was in the news recently with the announcement of its Bill Manager integration with AOL. Read more here.

*Manilla surveyed more than 1000 users by email over the course of several days in October.

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