Microbusiness Enabler ZenBusiness Closes Joust Acquisition Ahead of Rebrand

Microbusiness Enabler ZenBusiness Closes Joust Acquisition Ahead of Rebrand

ZenBusiness, an Austin, Texas-based company that specializes in serving micro-businesses, announced late last week that it has closed its first acquisition. The company has purchased fintech platform Joust in a move that will bring Joust’s business banking features to the ZenBusiness platform, and enable the firm to re-launch as ZenBusiness Money later this year.

The terms of the acquisition were not disclosed.

CEO and co-founder of ZenBusiness Ross Buhrdorf called the acquisition an opportunity to extend its “mission to provide the nation’s 57 million micro-businesses with exceptional and friendly tools that simplify the process of forming and running their business.” Founded in 2015, ZenBusiness helps entrepreneurs complete the necessary filing and paperwork to ensure compliant formation of their business, and provides a variety of additional services – from identity theft protection and business management tools – to help micro-businesses grow and expand.

Also based in Austin, Texas, Joust offers merchant services and business banking for entrepreneurs, freelancers, and the self-employed. The company, which merged with LoanDolphin earlier this year to scale mortgage reverse auctions, was a finalist at the 2020 SXSW Innovation Awards, and raised $11 million in funding prior to its acquisition by ZenBusiness. Joust was launched in 2017.

“We believe all entrepreneurs should have access to the same banking services reserved for large companies,” former CEO and Joust co-founder Lamine Zarrad said. “By bringing our financial tools to the ZenBusiness platform, we will quickly scale up and empower even the smallest businesses by simplifying and strengthening their daily operations while protecting their interests.”

ZenBusiness has raised $19.5 million in funding from 11 investors including Greycroft and Lerer Hippeau. The company was featured last December by The Jeruslem Post in its look at the top seven business formation services in the U.S.


Photo by nicollazzi xiong from Pexels

The QR Code Makes a Comeback in U.S. Mobile Payments

The QR Code Makes a Comeback in U.S. Mobile Payments

Remember when the mobile payments game was first getting started? The industry was rallying around NFC as the technology of choice for mobile payments. Bluetooth low energy (BLE) was a close second, and QR codes were generally the last choice.

That was in 2012 and now it appears that 2020 is throwing us yet another curve ball– QR Codes are back in style in the U.S. That’s because PayPal has partnered with InComm to launch its PayPal and Venmo QR codes technology at pharmacy chain CVS.

This move will implement low-touch mobile payments at CVS’ 8,200 brick-and-mortar stores across the U.S., offering shoppers a secure payment experience without needing to touch a keypad or sign a receipt.

PayPal users can pay using stored debit or credit cards, bank accounts, their PayPal balance, or PayPal Credit. Venmo users can also pay using their stored debit or credit cards and bank account, but will additionally be able to tap into their Venmo balance or Venmo Rewards.

“In the midst of COVID-19, we have seen an incredible acceleration of digital payments and touch-free payments,” said PayPal EVP and CPO Mark Britto. “Companies of all types and sizes are looking for ways to maintain the safety of their customers and employees, especially through touch-free experiences like curbside pickup and enhanced online shopping. QR codes complement these and provide retailers an additional payment method that furthers this touch-free mission and continues the growth of digital payments for all partners in the ecosystem. The essential nature of pharmacies makes CVS Pharmacy the perfect initial partner for PayPal and Venmo QR Codes – and we’re proud to help their customers stay safe while purchasing what they need.”

This week’s deal also marks a multi-year agreement between PayPal and InComm. The partnership enables InComm to distribute PayPal QR Code technology to its network of retailers, allowing them to integrate the QR code payment technology into their POS terminals.

PayPal has been touting its touch-free payment technology amidst the COVID-19 pandemic (see below). And given the payment giant’s previous traction and existing user base, the company will certainly come out on top as a winner in the post-pandemic economy.

https://www.youtube.com/watch?time_continue=4&v=Rr_sRAOn45Y&feature=emb_title

Elsewhere across the globe, QR code payments have already seen success. Ant Group’s Alipay uses QR codes for in-store payments and had over a 50% adoption rate at the end of 2018.


Photo by Jordan M. Lomibao on Unsplash

Birth of a Bank: Varo Money Secures National Charter

Birth of a Bank: Varo Money Secures National Charter

It’s been a good year for Varo Money. The company became the preferred destination for clients leaving Moven this spring, when the fintech announced that it was pivoting away from consumer banking in favor of a focus on its financial wellness technology.

A few months later, Varo reported a massive investment of $241 million in Series D investment, taking the mobile banking company’s total capital to more than $419 million.

Today we learn that one of Varo’s biggest goals for 2020 – earning a national bank charter – has been fulfilled. The San Francisco, California-based company has been granted a charter by the Office of the Comptroller of the Currency, and has earned regulatory approvals from both the FDIC and the Federal Reserve, making it now set to launch Varo Bank N.A. Varo is the first consumer-facing, U.S. fintech to accomplish this achievement.

“2020 has been challenging for many of us across the country and has highlighted, once again, how the traditional financial system is not meeting the needs of hardworking, everyday Americans,” Varo Money co-founder and CEO Colin Walsh said. “The ability to operate as a full-service national bank gives Varo more freedom to deliver the kind of innovation and allyship that many Americans have never had from their bank before.”

Launched in 2015, Varo Money offers consumers a digital banking alternative including a savings account with an initial APY of 1.21%, and a checking account that comes with a VISA debit card, and early payday for customers that sign up for direct deposit. Varo’s mobile banking app enables users to check up on their accounts and balances, make transfers and mobile check deposits, monitor incoming and outgoing transactions, and more. The company charges no hidden or overdraft fees for its service, and deposits are FDIC-insured up to $250,000.

Bank charter in hand, Varo will soon be able to offer a broader range of products and services including credit cards, joint accounts, and certificates of deposit.


Photo by Pixabay from Pexels

Circle Lands $25 Million, Partners with Digital Asset Brokerage Firm Genesis

Circle Lands $25 Million, Partners with Digital Asset Brokerage Firm Genesis

Blockchain-based money transfer platform Circle is making double headlines today. The U.S.-based company not only landed $25 million in funding, it also partnered with Genesis, an institutional trading firm offering two-sided liquidity for digital currency, including bitcoin.

Genesis parent company Digital Currency Group is the investor behind the $25 million. The investment is Circle’s first since August of 2018 and brings the company’s total funding to $271 million.

“Circle has been a pioneer in the digital currency market, building innovative products and services, and has consistently provided our industry with leadership on technology, standards, and regulatory policy,” said Genesis CEO Michael Moro. “With the rapid rise of USDC, we are clearly seeing mainstream momentum for digital currencies, and through this partnership with Circle we believe we can materially advance our shared mission of building a new global financial system.”

Circle will use the new funding to accelerate the adoption of USDC, a digital dollar stablecoin issued by regulated FIs, backed by fully reserved assets, governed by membership-based consortium Centre, and redeemable on a 1:1 basis for U.S. dollars. USDC has been gaining traction this year; earlier this month the cryptocurrency’s market capitalization crossed the $1 billion mark.

The investment will also provide a boost for Circle’s new Business Account and API products that the company launched earlier this year. These new services offer financial services companies a suite of APIs for USDC payments, facilitating the use of USDC in e-commerce, on-demand delivery marketplaces, digital gaming, internet services, P2P digital wallets, exchanges, B2B payments, challenger banks, trade finance, and digital asset lending and yield products.

“The partnership announced today between Circle and Genesis will bring to market solutions for businesses and developers who are seeking to generate strong positive yield from their own or customer USDC holdings, and access to USDC-based credit for businesses and merchants that are using USDC for treasury operations and business payments,” said Circle’s Josh Hawkins in a blog post announcement.

Digital Currency Group, which describes itself as the “epicenter of the bitcoin and blockchain industry,” has made 180 investments since it was founded in 2011. Digital Currency Asset Manager Grayscale and crypto news organization Coindesk are also Digital Currency Group’s subsidiaries.


Photo by Timothy Paul Smith on Unsplash

Intuit’s QuickBooks Steps into the Challenger Bank Ring

Intuit’s QuickBooks Steps into the Challenger Bank Ring

There’s no denying that challenger banks are one of the hottest things in fintech right now. The coronavirus has accelerated the need for a purely digital banking solution and this boost in demand has spurred an increase in the number of players in the space.

The newest challenger bank to enter the ring is Intuit-owned QuickBooks. The 28-year-old company is launching a business bank account called QuickBooks Cash. The new account will be promoted to QuickBooks’ existing user base of over seven million small businesses. The accounts boast a business bank account, debit card, an envelope budgeting tool, and cash flow management tools that work seamlessly with QuickBooks existing products, including payroll, payments, and accounting tools.

“QuickBooks Cash delivers what current business accounts don’t — a banking experience that enables small businesses to accept payments, pay teams and vendors — with automatic reconciliation for easy financial management,” said Rania Succar, Senior Vice President of QuickBooks Capital and Payments at Intuit. “Combining QuickBooks Cash with the powerful insights and financial management platform powered by QuickBooks, we are building a tool that accelerates the growth of small businesses. Companies that have more working capital can take advantage of more opportunities.”

QuickBooks Cash accounts will be backed by FDIC-insured Green Dot Bank and feature no balance requirements, a high-yield interest rate of 1%, billpay capability, cash flow planning tools, and more. Unlike most challenger banks which offer unlimited free ATM withdrawals, however, QuickBooks only allows four free withdrawals per month.

The new account, along with the corresponding tools, will roll out over the course of the next several weeks.


Photo by Attentie Attentie on Unsplash

Visa to Incorporate Cryptocurrencies into its Payments Network

Visa to Incorporate Cryptocurrencies into its Payments Network

It seems as if cryptocurrencies are starting to capture the attention of mainstream financial services providers. This week, Visa has shown to be no exception. The payments giant recently revealed plans to use cryptocurrencies into its traditional payments network.

In a blog post announcement, Visa said it has been working with Coinbase and Fold to “provide a bridge between digital currencies and [its] existing global network of 61 million merchants.” As a result of this collaboration, more than 25 digital currency wallets across the globe have linked up with Visa to enable consumers to spend their digital currency using a Visa debit or prepaid card.

“We believe that digital currencies have the potential to extend the value of digital payments to a greater number of people and places,” Visa said in a statement. “As such, we want to help shape and support the role they play in the future of money. We look forward to sharing more with you on this work in the months that follow.”

Visa is using its crypto partnerships to position itself as the preferred network for digital currency wallets. Not only this, but the company also launched a FastTrack Program that helps fintechs integrate quickly with Visa’s network. One initiative that has resulted from the program is Visa Direct, which helps consumers convert digital currency and push the funds to their Visa credentials in real-time.

This week’s announcement builds on Visa’s long-term plans for leveraging the blockchain and alternative currencies. The company has a dedicated team that has been researching uses for the blockchain for years. Currently, the team is working on facilitating offline digital currency transactions.


Photo by Dmitry Demidko on Unsplash

Paysafe Acquires Cash-to-Online Payments Company Openbucks

Paysafe Acquires Cash-to-Online Payments Company Openbucks

Global payments platform Paysafe announced its acquisition of online payments innovator Openbucks. Financial terms of the deal were not disclosed and the companies expect the acquisition to be finalized by the end of July.

Paysafe aims to leverage Openbucks to expand its cash alternative payment offering in the U.S. by tapping into Openbucks’ technology that allows consumers to pay online without a credit card.

“The cash alternative payment market is a thriving one and we are seeing increased demand from online merchants who want to enable gift cards as a payments solution in order to reach new consumers, particularly in sectors such as gaming, eSports and entertainment which are very much on the rise,” said CEO of Paysafe’s eCash division, Udo Mueller.

Openbucks maintains a network of partnerships with major retailers that enable consumers to purchase gift cards that can be redeemed at the company’s 500+ ecommerce merchant partners. Openbucks founder Marc Rochman expects the acquisition to offer a greater level of exposure to his company. “Now, with the full backing of a global payments provider,” he said, “we will be able to provide a world class alternative payment solution to thousands of additional online merchants.”

Openbucks was founded in 2011 and caters to underbanked shoppers, guaranteeing no fees to consumers. Since then, the company has raised $5.3 million.

Founded in 1996, Paysafe is a global payments innovator that offers both online and in-store payment solutions. Philip McHugh is CEO.


Photo by Thomas Lefebvre on Unsplash

Interactions Launches Virtual Collections Agent

Interactions Launches Virtual Collections Agent

Intelligent virtual assistance company Interactions launched a new product this week that aims to help accounts receivable management companies in their collections efforts.

The new product, Virtual Collection Agent (VCA), helps organizations with their collection efforts by– as the name suggests– providing a virtual agent to interact with the customer. The virtual agent creates efficiency for organizations by replacing human agents, creating scale, and automating negotiation.

Not only this, VCA is also beneficial to consumers. One in four consumers prefer interacting with a virtual agent when it comes to discussing uncomfortable financial information.

Piloting the new launch is ERC, a business process outsourcing service provider. “Over the past few years—and particularly in this pandemic—we recognized that automation was no longer a ‘nice to have’ in our industry, it was a requirement for addressing demand,” said ERC CEO Marty Sarim. “The response we’ve seen from both our customers and live agents has been encouraging, and the efficiencies we’ve been able to build into our business has put us in an extremely competitive position.”

Interactions’ other products include an intelligent virtual agent for customer engagement and a social listening and engagement tool that taps AI to to find and prioritize meaningful social posts, suggest responses, and gather insights.

Founded in 2004, Interactions facilitates one billion customer interactions per year across six different channels for large brands including Hyatt, Humana, LifeLock, and Mountain America Credit Union.


Photo by Paweł Czerwiński on Unsplash

Amazon is Now an InsurTech

Amazon is Now an InsurTech

Amazon is adding to its financial services offerings this week. The online retail giant is reportedly planning to sell insurance in India. The move marks Amazon’s first foray into insurtech.

“Our vision is to make Amazon Pay the most, trusted, convenient and rewarding way to pay for our customers, said India’s Amazon Pay Director and Head of Financial Services Vikas Bansal. “Delighted by this experience, there has been a growing demand for more services. In line with this need, we are excited to launch an auto insurance product that is affordable, convenient, and provides a seamless claims experience.”

To be clear, this won’t be just a “matchmaking” service that serves as a comparison marketplace, hosting multiple providers. Rather, Amazon will actually serve as a corporate agent– soliciting, procuring, and servicing insurance policies.

As its first move in the space, Amazon inked a partnership with Acko General Insurance to offer car and motorcycle insurance. The new offering is available via Amazon Pay and is 100% digital. Amazon Prime customers will receive additional benefits and deeper discounts.

At launch, the company will offer life, health, and general insurance.

Amazon will be competing with other BigTech companies in the region that offer insurance directly to consumers. According to BloombergQuint, SoftBank and Paytm already offer insurance, while Flipkart has already sought approval to sell life and general insurance.


Photo by Alexandre Feyfant on Unsplash

Insurtech Innovator Hippo Hauls in $150 Million; Eyes 2021 IPO

Insurtech Innovator Hippo Hauls in $150 Million; Eyes 2021 IPO

Palo Alto, California-based insurtech Hippo Enterprises has locked in $150 million in new financing and earned a valuation of $1.5 billion. The Series E round featured participation from new investors Dragoneer and Ribbit Capital as well as existing investors Felicis Ventures and Iconiq Capital.

This week’s investment takes the company’s total capital to $359 million.

Hippo will use the funds to expand in the U.S., and to help cover the costs of its acquisition of Spinnaker Insurance, which the company bought last month. According to reporting in BuiltinAustin, Hippo’s expansion plans include building a “new, 310-person campus in Austin.” Company Chief Insurance Officer Rick McCathron credited both the city’s “strong insurance presence” and central time zone positioning as enhancements to Hippo’s ability to serve customers across the U.S.

The funding comes amid a flurry of activity in the insurtech space. On the acquisition front, insurtech company Assurance IO was purchased by Prudential Financial in a deal valued at $2.35 billion. We also learned this week that technology titan Amazon is entering the insurtech business in India. And earlier this month, one of the more widely known insurtechs, Lemonade, went public, earning a $3 billion market cap on its first day of trading.

Hippo, led by CEO Assaf Wand, is planning an IPO of its own as well. Wand said that the terms of the offering had been determined before Lemonade’s IPO, but the onset of the global health crisis forestalled the company’s plans.

Founded in 2015, Hippo currently offers home insurance in 29 states in the U.S. including California, Texas, Illinois, and New Jersey. The company leverages automation to enhance the process of applying for and getting an insurance quote in less than 60 seconds. Hippo also uses machine learning and smart home devices to enable customers to stay updated on liability issues. The enabling technologies also provide consumers with preventative maintenance tips that will help them resolve small issues with their homes before they become major insurance claims.

Goldman and Mastercard Back Bond to Help Banks Forge Tech Partnerships

Goldman and Mastercard Back Bond to Help Banks Forge Tech Partnerships

Bond, a company that specializes in helping banks make the most out of their collaborations with technology partners has raised $32 million in Series A funding.

The round was led by Coatue, and featured participation from both Goldman Sachs and Mastercard. Canaan, B Capital, XYZ Ventures, and angel investors including former Morgan Stanley CEO John Mack were also involved in the round.

“The ongoing global pandemic and renewed focus on societal inequities make Bond’s mission of driving financial innovation and inclusion more important now than ever before,” Bond CEO and co-founder Roy Ng said in a statement. “Opportunity starts with access. We look to lead the industry in enabling banks and innovators across industries to level the playing field for consumers and small business.”

Bond offers banks a suite of developer-focused APIs and SDKs that remove friction from many of the critical processes involved in bank-brand partnerships, such as onboarding, technical integration, and product monitoring. Bond’s AI-enabled technology centralizes and streamlines these processes, and uses automation to provide oversight and ensure compliance.

“Today, more than ever, speed to market with a proven, reliable product is a competitive advantage,” explained Sherri Haymond, EVP, Digital Partnerships, Mastercard. “Bond provides an entirely new approach to help its fintech and bank partners deliver for the end user. We look forward to working with them as they move to this next stage.”

In a blog post discussing the announcement, Ng articulated the challenge facing smaller regional banks and community lenders when they try to forge partnerships with technology companies. He blamed a wide variety of factors – from compliance to operational constraints – for making it difficult for these partnerships to even “get off the ground.” This, Ng said, is where Bond comes in. “Rather than have every app and every bank recreate the wheel for each new partnership, Bond now does the hard work in the middle so banks and brands can each concentrate on what they do best,” he said.


Photo by freestocks.org from Pexels

Ant Group’s Double IPO Listing Shuns U.S. Exchanges

Ant Group’s Double IPO Listing Shuns U.S. Exchanges

New information has come out this week about Ant Group’s IPO plans.

Instead of listing on the tech-heavy (and U.S.-based) NASDAQ, Ant Group will list concurrently on Hong Kong’s Hang Seng and Shanghai’s Star Market. This comes after Ant’s parent company, Alibaba listed on the New York Stock exchange in 2014.

Analysts suspect that Ant’s listing plan is largely a response to rising geopolitical tensions between the U.S. and China. There are practical reasons, however, for Ant to list in Hong Kong and Shanghai. Hong Kong introduced weighted voting rights in 2018 and Shanghai’s Star Market offers more market-driven pricing than other domestic exchanges.

“The innovative measures implemented by the Shanghai Star Market and the stock exchange of Hong Kong have opened the door for global investors to access leading-edge technology companies from the most dynamic economies in the world,” said Ant’s executive chairman Eric Jing. “and for those companies to have access to the capital markets.”

Ant’s parent company Alibaba still holds the record for the second-largest IPO when it listed on the New York Stock Exchange in 2014 and raised $24 billion. It is too early for Ant to discuss size and timing of the share sales; analysts have valued the company in the range of $210 billion to $218 billion.


Photo by Alexandre Debiève on Unsplash