Daily news

U.S. Bank Buys Expense and Travel Management Platform TravelBank

U.S. Bank Buys Expense and Travel Management Platform TravelBank
By David Penn Posted on
Categories: Daily news, Mergers & Acquisitions, US Bank

U.S. Bank has agreed to acquire San Francisco, California-based expense and travel management company TravelBank. Financial terms of the transaction were not disclosed, but one outlet, Skift, has said that the deal was valued at $200 million.

“We are focused on giving businesses more confidence, control, and convenience in managing payments and expenses,” U.S. Bank Vice Chair of Payment Services Shailesh Kotwal said. “TravelBank will help us accelerate these efforts.”

Founded in 2016, TravelBank offers an all-in-one solution for expense and travel management. Relying on a single platform, reporting model, and subscription price, TravelBank helps employees and businesses control and track expenses, automate traditionally manual processes, streamline both approvals and reporting, and remain compliant. With more than 20,000 customers, TravelBank claims to have reduced business travel spending by its clients by 30% on average, while simultaneously boosting employee morale with a user-friendly design and a travel rewards program. Ahead of this week’s acquisition, the company had raised $35 million in funding from investors including Dreamers VC and DCM Ventures.

“We created TravelBank to provide a single experience for expense reporting and travel management,” co-founder and CEO of TravelBank Duke Chung explained. “Our combined offering with U.S. Bank will be the most comprehensive expense, travel, and payment management solution in the industry.”

Skift further reported that Chung will “move over to the bank” post-acquisition, while TravelBank will continue to support its existing clients.

The acquisition is the fruit of a partnership between the two companies that extends back to September of 2020. In the fall of last year, U.S. Bank integrated TravelBank’s travel and expense management platform into its U.S. Bank Instant Card. The collaboration enabled program administrators to issue Instant Cards directly from their expense management platforms.

With nearly 70,000 employees and $567 billon in assets, U.S. Bancorp is the parent company of U.S. Bank National Association. Headquartered in Minneapolis, the bank serves millions of customers, both in the U.S. and around the world, with a variety of services including consumer and business banking, payments, corporate and commercial banking, wealth management, and investments.

U.S. Bank demonstrated its Card-as-a-Service (CaaS) solution at FinovateFall 2021 in September. The technology enables companies to leverage API integration to extend corporate credit digitally and create a custom virtual payment experience in their ecosystem.

Photo by Jason Boyd from Pexels

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MoneyLion Acquires Creator Network and Content Platform MALKA

MoneyLion Acquires Creator Network and Content Platform MALKA
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Mergers & Acquisitions

MoneyLion made a move today that will help it catch the eye of prospective customers and retain its existing ones. The digital bank acquired MALKA, a creator network and content platform, to help it better engage with consumers and connect with communities.

MALKA was founded in 2012 and works with creators to develop content across digital mediums including advertising campaigns, original branded content, e-gaming livestreams, podcast series, feature length documentaries, sports representation, and marketing. One of MALKA’s differentiating factors is that it maintains a talent base of 170 employees in-house in order to maintain relationships instead of working with different freelancers on different projects.

MALKA will help MoneyLion, which already offers MoneyLife content, in its mission to become a daily destination by bringing evergreen content to educate, inform, and support customers’ financial decisions. Ultimately, integrating MALKA’s content into MoneyLion will support the digital bank’s marketing and brand-building efforts.

“Through this acquisition, which we anticipate will be accretive and cash flow positive in 2022,” said MoneyLion Co-Founder and CEO Dee Choubey, “we will now be able to fully leverage MALKA’s capabilities so that the MoneyLion brand can truly live wherever our customers are investing their attention.” CMO Bill Davaris added, “This fundamental shift will allow us to own and not rent the relationships we are cultivating with new and existing MoneyLion customers.”

At face value, a tie-up between a digital bank and a content creation company seems a bit odd. The acquisition, however, can be seen as MoneyLion simply buying its own creative marketing and content department. No matter how you look at it, the acquisition is a hat tip to the new creator economy and speaks to how content-driven today’s consumers are.

MALKA will operate independently from MoneyLion and the company’s Founder and CEO Louis Krubich and Co-Founder and President Jeff Frommer will continue to lead daily operations. “This partnership will allow us to exponentially grow our creator network and engage with millions of more fans,” said Krubich.

MoneyLion launched in 2013 and offers a full-service platform that delivers mobile banking, lending, and investment solutions. Earlier this year the company teamed up with Zero Hash to launch the ability for users to buy, sell, and hold cryptocurrencies. The company went public on the New York Stock Exchange in September via a SPAC merger with Fusion Acquisition Corporation.

Photo by Ahmad Odeh on Unsplash

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Upgrade Now Valued at $6 Billion after $280 Million Raise

Upgrade Now Valued at $6 Billion after $280 Million Raise
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Funding

Alternative credit provider and digital bank Upgrade announced a $280 million investment this week. The Series F round brings the company’s total funding to $600 million and boosts its valuation to $6 billion, which is almost double its last valuation of $3.3 billion in August.

The round was led by Coatue Management and DST Global with participation from Dragoneer Investment Group, Gopher Asset Management, G-Squared, Koch Disruptive Technologies, Old Well Partners, Ribbit Capital, Sands Capital, Ventura Capital, and Vy Capital.

Upgrade was founded in 2016 and offers a variety of low-cost personal loans and credit cards that come with rewards ranging from Bitcoin cashback to 3% cashback. Earlier this year the company debuted a checking account with a debit card that pays 2% cashback for common expenses.  

The company differentiates its card, which is issued by Sutton Bank, from traditional credit cards by combining monthly charges into installment plans that the borrower repays over 24 to 60 months. Upgrade structures the repayment this way to get its users into the habit of paying down their balance every month and avoid getting trapped in a continuous cycle of debt.

The funding news comes four months after Upgrade closed its $105 million Series E round. Company CEO Renaud Laplanche said that the round “demonstrates Upgrade’s rapid growth and commitment to delivering innovative financial products that benefit consumers.”

The “rapid growth” Laplanche references has been seen in recent acclamations. Earlier this year the Financial Times selected Upgrade as the fastest growing company in the Americas and the Nilson Report recognized the Upgrade Card as the fastest growing credit card in America, placing Upgrade among the top 50 U.S. credit card issuers.

Since launching its credit card in 2017, Upgrade has delivered $10 billion in total credit to customers via the company’s credit cards and loan products. The majority of this credit has been issued this year alone; the company is on track to deliver $8 billion in credit in 2021.

Upgrade is headquartered in California with an operations center in Arizona and a technology center in Canada. The company is partnered with Cross River Bank and Blue Ridge Bank for credit lines and banking services, NYDIG for Bitcoin rewards, and Sutton Bank for card issuance.

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eBankIT Teams Up with Wise to Enable Banks to Offer Faster, Cheaper Money Transfers

eBankIT Teams Up with Wise to Enable Banks to Offer Faster, Cheaper Money Transfers
By David Penn Posted on
Categories: Alumni News, Daily news, ebankIT, Wise

A pair of long-time Finovate alums have teamed up to give banks and other financial institutions access to faster, more affordable international money transfers.

Bank software innovator ebankIT and worldwide money transfer platform Wise (formerly Transferwise) announced today that Wise’s international money transfer service will be the first solution of its kind to be made available on the ebankIT platform marketplace. Relied upon by financial institutions to build up their digital banking service options, the marketplace will enable these firms to add the money transfer service to their offerings without having to integrate it separately on their own.

“We believe in a better future for banking with true omnichannel capabilities – and international transfers are an essential part of this,” ebankIT CEO Renato Oliveira said. “By bringing together Wise, ebankIT, and our clients, we are changing international transfers for everyday people across the world. We’re delighted to offer Wise platform to our clients, so they can instantly tap into Wise’s world-leading infrastructure.”

Wise Platform has 12 distribution partners and 18 banks in 11 countries using the technology, along with seven enterprises. The company notes that 40% of its transfers are delivered in less than 20 seconds, and Wise charges no hidden fees by way of exchange rate mark-ups or other calculations. On average, Wise’s international money transfers are as much as eight times less expensive than those offered by traditional money service firms and other providers.

“For too long, international transfers have been slow, inconvenient, and blighted by traditional providers charging high, hidden fees,” Wise Head of Product Steve Naudé said. “It’s time for change. We aim to set a new global standard for international transfers across the industry. We’re thrilled to be working with ebankIT, a company that shares our vision. Together, along with ebankIT’s network of banks and financial institutions, we can help drag international transfers into the twenty-first century.”

Rebranding as Wise in February, the company formerly known as Transferwise has been a Finovate alum since its appearance on stage at FinovateEurope in 2013. In the years since, the London-based company has reached more than eight million customers worldwide and transfers more than $7.5 billion in customer funds every month. Wise’s technology currently comes pre-integrated in a number of core banking platforms including those from Temenos, Mambu, and Thought Machine.

The company went public on the London Stock Exchange this summer, earning a market valuation of $11 billion. Last month, Wise announced an integration with The Orchard, a subsidiary of Sony Music that specializes in music distribution and artist services. The partnership offers the company a more streamlined way for music labels to make royalty payments to musicians in multiple countries and currencies.

A Finovate Best of Show winner in 2019, ebankIT was founded in 2014 and is headquartered in Porto, Portugal. The company’s core-agnostic Omnichannel Digital Banking platform was recognized last year in both Gartner’s Market Guide for Multichannel Digital Banking Solutions and its Market Guide for Digital Banking Platforms. In partnership with Celero, a Canada-based solutions integrator for credit unions and other financial institutions, ebankIT’s technology this year has powered digital transformations at institutions such as Swan Valley Credit Union, 1st Choice Savings and Credit Union, and Entegra Credit Union.

Photo by Paul IJsendoorn from Pexels

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Float Lands $30 Million for Spend Management Technology

Float Lands $30 Million for Spend Management Technology
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Funding

Float, a Canada-based startup that offers a corporate card and spend management solution, landed $30 million (C$37 million) in funding this week. The Series A round was led by Tiger Global and brings the company’s total funding to $34 million (C$42 million).

The funding will help Float with its mission to deliver an end-to-end spend management platform for SMBs. “We want this platform to enable businesses and teams to focus on investing in their growth and eliminate the need to use different banking and software tools to make day-to-day payments… Float’s mission is to simplify spending for companies and teams,” the company explained in a blog post.

Float was founded in 2019 to offer Canadian SMBs a high-limit, no personal guarantee corporate card that is available in three business days or less. This turnaround is impressive when compared to the average four+ week wait time most businesses face to receive their corporate spending cards. Businesses can set custom spending limits, assign cards to employees, and review and approve transactions in real time.

In addition to the card capabilities, Float also offers spend management software that natively integrates with accounting software such as QuickBooks and Xero. The dashboard helps employers track real-time spending and provides an overview of individual, departmental, and categorical spending.

The investment comes at a good time for Float, which has seen significant growth since launching to the public in March of this year. The company now has hundreds of small business clients and continues to experience increased engagement. Float’s total payment volume has increased ~20x since June and its average monthly customer spend has increased more than 6x since March.

Float offers a freemium pricing model with varying features. All tiers come with 1% cashback, 0% FX fees, unlimited users, automatic top-ups, and a $100,000 spending limit. The paid tiers provide custom integrations, team management, and more.

Photo by Hello I’m Nik on Unsplash

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BM Technologies Inks Strategic Merger with First Sound Bank for $23 Million

BM Technologies Inks Strategic Merger with First Sound Bank for $23 Million
By David Penn Posted on
Categories: Daily news, Mergers & Acquisitions

BM Technologies (formerly known as Bank Mobile) has agreed to merge with Seattle-based community lender First Sound Bank for $23 million. The combined entity will be called BMTX Bank and will serve customers across the country digitally while maintaining a community banking division that will continue serving customers in the greater Seattle market.

“This is a thrilling milestone for BM Technologies and is a major step forward in executing our vision to create a disruptive FinTech bank that combines the best of financial technology with a strong and compliant FDIC-insured institution,” BM Technologies, Chair, Founder, and CEO Luvleen Sidhu said.

BMTX will pay up to $7.22 in cash for each share of First Sound Bank common stock, which amounts to approximately $23 million. Subject to regulatory approvals and customary closing conditions, the strategic merger is slated to close in the second half of 2022. The deal is expected to add significantly to the combined company’s revenue, EBITDA, and earnings trajectory over the next one to three years. Sidhu said that the strategic merger will enable BMTX Bank to offer a variety of new services including direct to consumer and small business operations, marketplace lending, robo-advisory, and blockchain-based payment systems.

“As one of the largest digital banking platforms in the country with approximately 2 million accounts, this merger allows BMTX to lead a new wave of financial innovation by enhancing its focus on technology, inclusion, easy-to-use products, and customer education with the mission of creating ‘customers for life,'” Sidhu explained.

Sidhu will serve as Chair and CEO of BMTX Bank, and will be directly responsible for digital banking initiatives. First Sound Bank President and CEO Marty Steele will serve as COO of BMTX Bank and will lead the company’s community banking division.

“As a local bank, we remain committed to our community and are excited about the opportunity to leverage BMTX’s innovative digital banking technology, Banking-as-a-Service business model, low-cost deposit funding, and better access to the capital markets in order to scale our SBA, commercial and private banking, mortgage, and other business lines,” Steele said.

Founded in 2004 with the largest initial capital base of any de novo bank in the Pacific Northwest at the time, First Sound Bank provides commercial banking services for SMEs, not-for-profit organizations, entrepreneurs, and professional service firms in the Puget Sound region. Headquartered in Seattle, Washington, First Sound Bank has approximately $150 million in assets.

Formerly known as Bank Mobile, BM Technologies was launched in 2015 with a goal of providing a simple, affordable, and financially empowering, digital-first banking experience. The company went public via SPAC at the beginning of the year, listing on the New York Stock Exchange under the ticker BMTX. BM Technologies currently has a market capitalization of $145 million.

The company’s strategic merger announcement comes on the heels of BM Technologies’ Q3 results. Among the quarter’s highlights, BM Technologies reported that serviced deposits topped $2 billion for the first time. The company also earned recognition in the 2021 Finovate Awards in September, winning Best Fintech Partnership courtesy of its collaboration with T-Mobile.

To learn more about BM Technologies, check out our Fireside Chat with Luvleen Sidhu from FinovateFall 2021 in New York.

Photo by Scott Webb from Pexels

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Stori Raises $200 Million for Financial Services for the Underserved

Stori Raises $200 Million for Financial Services for the Underserved
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Funding

Mexico-based Stori landed $200 million this week in combined debt and equity. The investment, which bring the company’s total funding to almost $250 million, will help the fintech provide financial services to its region’s underserved customers.

The $125 million in equity was co-led by GGV Capital and GIC with contributions from General Catalyst, Goodwater Capital, Tresalia Capital, Lightspeed Venture Partners, Vision Plus Capital, BAI Capital, and Source Code Capital. The $75 million in debt financing comes from Community Investment Management.

The investment echoes Stori’s success in the region. The company has become one of Mexico’s top issuer of new credit cards since February of this year. In fact, more than 2 million Mexicans have applied for a Stori credit card, and that number has grown by more than 10 times in the last twelve months.

And there is still plenty of room for growth. The broader Latin American region has 400 million underserved consumers. “Our mission – empowering financial inclusion for millions of hard-working people – is amazingly meaningful and challenging at the same time,” said Stori CEO and co-founder, Bin Chen. “We are progressing at an unprecedented pace by combining technology, machine learning, data-driven underwriting and an intuitive mobile-based user experience. A lot more will come in our journey to become a top consumer financial franchise in Latin America.”

Stori plans to use today’s funds to triple in size and broaden its product offerings to better suit customer needs, ultimately providing much-needed financial services to Mexico’s underserved citizens. The fresh capital will also help Stori grow its team and double down on training and development opportunities.

While Stori is focused on the Mexico region, the company boasts a global team with offices in Washington D.C., Mexico, and Asia. “Our success since launch is a direct result of having a team who is passionate about our mission to empower upward financial mobility for the underserved population,” said company Co-founder Marlene Garayzar. 

Photo by Andrés Sanz on Unsplash

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Atomic Lands $25 Million for its Investing-as-a-Service Technology

Atomic Lands $25 Million for its Investing-as-a-Service Technology
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Funding

Wealthtech company Atomic announced its company launch along with a $25 million in a Series A funding round today. The round, which was co-led by QED Investors and Anthemis with participation from Softbank and Y Combinator, will help fuel the company’s investing API that allows fintechs and banks to integrate investing into their existing products.

With Atomic’s API, companies can launch investing experiences such as direct indexing, ESG investing, and multi-currency trading across 60 global markets with no account minimums. The “investing-as-a-service” nature of the new offering means that companies can launch investing tools in a matter of weeks without relying on in-house experiences. In fact, Atomic takes care of not only the investing experience, but also the details around regulations, brokerage operations, and compliance.

“What we see is that fintechs and other consumer-facing companies want to offer savings and investment, but most have come to market with very limited product offerings — only single stock trading or only ETF investing,” said QED Investors Partner Amias Gerety. “Atomic provides cutting edge solutions so that their partners can offer both of these products easily, but also offer advanced features like ESG, direct indexing, and tax loss harvesting that are usually only available for accounts with hundreds of thousands of dollars in them.”

Atomic helps companies retain customers by broadening their existing offerings to include investing– a financial tool that generally creates long-term customer loyalty. “Any fintech or bank that wants to become their end-customers’ primary financial relationship will need to offer investing on their platform to remain competitive,” said Atomic CEO David Dindi. “As an accelerant in the rapidly evolving ecosystem of unbundled financial services, Atomic enables these businesses to offer investing in a frictionless way as a means to deepen their relationships with customers.”

Among Atomic’s client base are fintechs such as Upside, a student loan innovator. Upside is leveraging Atomic’s API to build a wealth management offering that allows its users to refinance their student loans and reinvest the savings.

Dindi, along with the company’s CTO Marco Alban are both Stanford graduates and serial entrepreneurs.

Photo by Taylor Peake on Unsplash

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Xspaced Launches Virtual Bank Accounts for Renters

Xspaced Launches Virtual Bank Accounts for Renters
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news

Flexible rent payment platform Xspaced launched its digital bank accounts for tenants today. The bank accounts enable Xspaced’s FlexRent product, a tool that helps tenants split their rent payment into two to three installments over the course of a month.

Today’s launch offers Xspaced an important distinction in the online rental payments space– it doesn’t require landlords to register. Instead, tenants can use the virtual bank account independently and landlords can continue using their preferred online rent collection platform.

“Since launching FlexRent last year, we’ve continuously heard from tenants that they would like to have more flexibility when it comes to paying rent and from landlords that they want to keep their current rent collection system,” said Xspaced Cofounder Alex Pelin. “Tenants can save money towards their next rent payment via smaller payments over the month, landlords can keep collecting rent on their preferred payment portal – it’s a win / win for everyone!”

Aimed at gig workers and others with inconsistent income, FlexRent connects to users’ existing bank accounts. Xspaced sends tenants automated payment reminders to help them save money for their upcoming rent payment two to three times each month. At the beginning of the following month they can used the money they saved to pay their landlord using their landlord’s online rental collection platform.

Modern payments platform Dwolla is powering the money movement piece of FlexRent. “Making expense management simpler for anyone on a variable income has been a challenge for a long time,” said Dwolla CEO Brady Harris. “With Virtual Account Numbers, Xspaced is helping make rent easier by helping tenants align their rent payments with their income schedule. We’re proud to power part of their solution.”

The utility of Xspaced’s new virtual bank account offering seems inflated. FlexRent simply sends a reminder to users to send their rent payment and serves as an account to hold the payment. It is the renter’s responsibility to transfer the funds to the Xspaced account and to pay their landlord using the funds held in the Xspaced account.

This is not much value in exchange for the cost, which ranges from $2.99 per month for two payment installments to $5.99 per month for three or four payment installments. The FlexRent account requires users to have a bank account already, so renters may as well open a savings account at their bank to which they can set up multiple automatic transfers.

That said, Xspaced must offer at least some value, because the California-based company boasts that, “thousands of renters love Xspaced.”

Photo by Bench Accounting on Unsplash

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txtsmarter Inks Partnership with Client Onboarding Software Provider GuideCX

txtsmarter Inks Partnership with Client Onboarding Software Provider GuideCX
By David Penn Posted on
Categories: Alumni News, Daily news, txtsmarter

San Mateo, California-based txtsmarter, an intelligent communications surveillance service for text and social channel communications, has forged a partnership with GuideCX, a client onboarding software company. GuideCX will streamline the onboarding process for txtsmarter customers as the company expands across the country.

“Txtsmarter is growing at such a high rate that transparency and accountability during the onboarding process are a must for their customers,” GuideCX founder and CEO Peter Ord said. “Their one-day onbording has set a new level for GuideCX as we continue to perfect our process and show people everywhere why our technology can make all the difference for their businesses moving forward.”

txtsmarter made its Finovate debut last year at FinovateWest and returned to the Finovate stage this fall for FinovateFall in New York. The company offers a SaaS platform that enables employees and customers in regulated industries to use native communications apps such as iMessage, WhatsApp, Android, and WeChat/WeCom. txtsmarter’s platform provides effective capture, encryption, and archiving of text and social media messages, immediately identifying any inappropriate communication or potentially fraudulent activity.

Founded in 2014, txtsmarter includes one of the largest financial institutions in the world and a major U.S. sports league among its customers. The company began the year with the announcement that it had entered a strategic partnership with compliance technology and data analytics firm, Steeleye. The collaboration will combine txtsmarter’s message capture and archiving service with Steeleye’s advanced communications surveillance solution.

“Via our partnership with SteelEye, we offer our clients a 360-degree archiving and surveillance service, supplying real-time access to previously inaccessible data,” txtsmarter President and CEO Nuri Otus said. “Only txtsmarter can capture native iMessage and Android SMS/MMS messages providing a full view of all communications – which is necessary for full compliance and to avoid huge sanctions. We all know the real conversations happen via text.”

Photo by Alok Sharma from Pexels

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Best of Show Winner Autobooks Helps Small and Micro Businesses Get Paid Faster

Best of Show Winner Autobooks Helps Small and Micro Businesses Get Paid Faster
By David Penn Posted on
Categories: Alumni News, Alumni profile, Autobooks, Daily news

Sometimes at Finovate, the first time is the charm.

Detroit, Michigan-based fintech Autobooks, which helps small businesses send digital invoices and accept online payments via their financial institution partner, took home Best of Show honors in its Finovate debut in September. The company, co-founded by Steve Robert (CEO) and Aaron Schmid (CIO), impressed our audiences with its embedded solution that gives small businesses an e-commerce platform that is fully integrated into their current digital banking system.

Autobooks shared the stage with partner TD Bank, which offers Autobooks’ suite of tools as part of its TD Online Banking solution. TD Bank Head of Corporate Products and Services Jo Jagadish noted that the partnership has “increased relationship depth with our SMBs by 26%” and represented what Jagadish referred to as a complete reimagining of the bank’s small business checking experience.

“Small businesses are an enormous and diverse group with one thing in common,” Robert explained, “how they get paid is in a state of transition. Financial institutions must invest in digital-first experiences to meet SMBs where they, and their customers, are.” One advantage Autobooks provides is the fact that its technology is embedded into the customer’s existing banking channels, helping financial institutions build and fortify their relationships with their small and micro-business customers.

In the weeks since Autobooks’ Best of Show winning demo at FinovateFall, the company has announced a partnership with Central Trust Bank. Headquartered in Jefferson City, Missouri, the $20 billion state-chartered trust company will embed Autobooks’ technology into its digital banking platform. In addition to giving the bank’s business customers the ability to send digital invoices and accept online payments, the integration will also provide cash flow management, accounting, and financial reporting tools.

“We’re dedicated to providing innovative solutions to our customers, and the tools to make banking as easy as possible,” Central Trust Bank SVP of Commercial Banking Services Arlene Vogel said. “We believe partnering with Autobooks will allow for business customers to optimize payments for their business, ultimately helping their business succeed.”

Central Trust Bank has more than 250 locations in 78 communities in Missouri, Kansas, Illinois, Oklahoma, Tennessee, North Carolina, Colorado, and Iowa. The bank was founded in 1902.

Also last month, Autobooks announced that it had expanded its partnership with TD Bank to add invoicing to TD Bank’s TD Business Simple Checking offering. The bank’s business customers will now be able to accept credit card and electronic payments that settle directly into their TD account. This will enhance cash flow and liquidity, and will make it that much easier for small and micro-businesses to get paid faster. The collaboration marks TD Bank as one of the first major financial institutions to offer integrated invoicing as part of its digital banking solution.

“Probably the greatest pain point for small businesses is actually getting paid for the services they provide,” Jagadish said. “The new tool will make things easier, faster, and enable our small business customers to get paid, almost immediately in most instances, when the process previously could take up to a week or longer.”

Previous to co-founding Autobooks, both Robert and Schmid were executives with another Finovate alum, Billhighway. Robert served as Chief Information Officer, while Schmid was Chief Product Officer. The company was acquired by BluePay in 2016.

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Socure Locks in $450 Million in Series E Funding; Earns Valuation of $4.5 Billion

Socure Locks in $450 Million in Series E Funding; Earns Valuation of $4.5 Billion
By David Penn Posted on
Categories: Alumni News, Daily news, Funding, Socure

Digital identity verification and fraud solution provider Socure has scored $450 million in what the company called a “significantly oversubscribed” Series E funding round. The investment comes just seven months after the company’s $100 million Series D round, and boosts Socure’s valuation to $4.5 billion.

“With this additional capital, we will substantially increase our level of commercial velocity and intensity in solving complex customer and societal problems, while maintaining our Day 0 founder’s mentality and continuing to attract the market’s best product, data science, and engineering minds to join our already incredibly talented team,” Socure founder and CEO Johnny Ayers said.

The Series E was led by Accel – along with funds and accounts advised by T. Rowe Price Associates. New investors Bain Capital Ventures and Tiger Global joined existing investors Commerce Ventures, Scale Venture Partners, and Sorenson Ventures in the round, as well. Socure’s total equity funding stands at $647 million.

The investment gives Socure the highest valuation of any private company in the identity verification market. The company’s identity verification and fraud-fighting platform Socure ID+ has gained meaningful traction in the enterprise, with four of the five largest banks and seven of the 10 largest credit card issuers embracing the technology. Add to this a host of major fintechs, Buy Now Pay Later firms, investment management companies, and crypto exchanges. Socure has enjoyed 5x year-over-year bookings growth, more than 2x year-over-year customer growth, and five consecutive quarters of record year-over-year revenue growth.

Additionally, Socure achieved a net retention rate of 179% which the company said was due to “near-zero attrition” as Socure’s enterprise customers deployed multiple Socure solutions across divisions at an increasing rate. The result has been to make Socure an all-in-one platform for fraud prevention, KYC, AML, and document verification in the enterprise.

“When you’re a market leader, you move from attacking and replacing the incumbents repeatedly as you earn your seat at the table to truly being a strategic partner to many of the best companies in the world,” Ayers said.

Socure will use the new capital to further invest in product innovation, enter new markets such as telehealth, gaming, e-commerce marketplaces, and the public sector, and add talent to the Socure team – especially in the areas of product development, data science, and engineering. The company also will use the investment to enhance both its customer consortium data and automated ID+ platform to address payment and first party fraud as effectively as it currently combats third party and synthetic fraud.

Founded in 2012 and making its Finovate debut a year later at FinovateFall, Socure has had a busy autumn in 2021, launching new fraud prevention solutions and adding a new Chief People Officer in September, plus reaching a 750 customer milestone early in October. Also in October, Socure announced a major commitment to deliver identity verification solutions to the public sector market, appointing Matt Thompson as its new General Manager of Public Sector Solutions.

“Many agencies lack the industry experience required to effectively manage identity verification and reduce fraud losses in the midst of accelerated digital transformation due to the pandemic,” Thompson explained. “Furthermore, the gaps within legacy identity solutions were exposed leaving numerous eligible people waiting extended periods of time for their benefits while enabling fraudsters to manipulate these same benefits at an unprecedented level. We are committed to solving this challenge for government agencies.”

Photo by Tara Winstead from Pexels

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