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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Enterprise risk and banking fraud protection NetGuardians landed $19 million (chf 17 million) in funding this week.
The round, which is more than double each of the company’s previous rounds, brings the company’s total funding to $34.5 million (chf 30.6 million). Investors include NetGuardians client the Pictet Group, as well as private investment group ACE & Company.
NetGuardians will use the investment to help it meet rising demand for its fraud-mitigation software. Specifically, the company will strengthen its position in existing markets and further develop its SaaS subscription model.
“Since our first round of funding, we have been able to grow and strengthen our fraud-mitigation platform worldwide, serving institutions in more than 30 countries,” said NetGuardians Chief Strategy Officer Raffael Maio. “This latest round of funding will help us to reach more clients and explore new markets with our Collective AI technology provided as software-as-a-service.”
Founded in 2007 and headquartered in Switzerland, NetGuardians employs 90 people in its offices across Singapore, Kenya, and Poland.
Sweden-based open banking platform Tinkannounced it has closed an extension on the venture round it landed in January. The additional $103 million (€85 million) brings Tink’s total funding to almost $310 million.
According to CNBC, the investment boosts Tink’s valuation to $824 million.
The new round was co-led by new investor Eurazeo Growth and existing investor Dawn Capital. Other existing investors PayPal Ventures, HMI Capital, Heartcore, ABN AMRO Ventures, Poste Italiane, and Opera Tech Ventures also contributed.
Tink will use the new round to fuel its expansion and further develop its payment initiation technology. Company CEO and Co-founder Daniel Kjellén noted that Tink has seen an impressive amount of growth this year. “We significantly built out our bank connections across Europe, increasing coverage from 2,500 to 3,400 banks, and now serve more than 300 world-leading financial institutions,” he said. “We also doubled the fintech users on our platform to 8,000 and increased employees from 250 to 365, in 13 offices across Europe.”
This growth comes after Tink’s recent three key acquisitions, including Swedish credit decisioning firm Instantor, Spanish account aggregation provider Eurobits, and the aggregation platform of U.K. open banking pioneer, OpenWrks.
Founded in 2012 and headquartered in Stockholm, Tink has more than 350 employees and is currently serving its clients out of 13 local offices across Europe. The startup operates in Sweden, U.K., France, Spain, Germany, Italy, Portugal, Denmark, Finland, Norway, Belgium, Austria and the Netherlands. Tink most recently demoed at FinovateEurope 2019 where it showcased its API platform.
Courtesy of a Series B funding round led by Sequoia Capital, API protection platform company Salt Securityhas doubled its total equity capital. The company, which is based in Palo Alto, California, picked up $30 million in new funding this week. Existing investors Tenaya Capital, S Capital VC, and Y Combinator also participated in the investment.
“APIs have become a fundamental unit of software,” Sequoia Partner Carl Eschenbach explained. “Salt Security enables organizations to discover APIs, prevent real-time attacks, and facilitate remediation, so customers can continue to operate and innovate in an increasingly digitized world.”
Salt Security’s Series B comes only a few months after the company completed a $20 million Series A round in June. The firm said that the new capital will help the company invest in product development, sales and marketing, and customer acquisition in 2021. As part of the deal, Eschenbach, as well as representatives from Tenaya Capital and S Capital, will join Salt Security’s board of directors.
“Raising both Series A and B, growing our customer base 200%, and building unmatched technical capabilities – all during this tumultuous year – gives us a formidable lead in the market we created and defined,” Salt Security co-founder and CEO Roey Eliyahu said. “Having someone of Carl’s caliber and experience guiding us will simply accelerate our success in the API security market.”
Salt Security notes that its API Protection Platform is the only patented API security solution designed for each stage of the API lifecycle. The technology learns the behavior of company APIs at a granular level, and uses machine learning and AI to automatically identify and block API attacks. The technology can be deployed in minutes with no configuration or customization required.
Salt’s platform was named a 2020 Cool Vendor in API Strategy by Gartner and a SINET 16 Innovator Winner for 2020. This fall, the company has announced partnerships with Carrefour, a French multi-national retail corporation, and U.S.-based, global colocation data center company Equinix.
Founded in 2016, Salt Security is headquartered in Silicon Valley, California; and in Israel. Forbes featured company co-founder Eliyahu in its 30 Under 30 roster earlier this month.
Yesterday we shared news that EVERFI and Sallie Mae were teaming up to promote financial literacy for high school kids in California. Today we share news on another youth finance-related front. gohenry, which specializes in providing financial education for youth and their families, has secured $40 million in financing. The round was led by Edison Partners, and featured participation from Gaia Capital Partners, Citi Ventures, and Muse Capital.
The funding takes the company’s total capital to more than $56 million.
“For too long, kids have been locked out of the digital economy and parents lacked the tools to help their children gain confidence with money and finances,” gohenry CEO Alex Zivoder said. “gohenry was the first to respond to these needs in 2012 when we launched a groundbreaking financial education app and debit card that truly empowered children. In 2020, we’ve achieved three key milestones: becoming profitable which many B2C fintechs seek, raising $40 million during COVID, and partnering with world leading funds. All three will help us fuel our U.S. expansion.”
gohenry specializes in helping kids aged six to eighteen develop sound money and financial habits. Launched in the U.K. as a financial literacy app and debit card in 2012, the company has grown its offerings to include its Teen and Eco cards – both of which feature built-in parental controls. The company’s solutions enable youth to learn how to manage allowances and other earnings and give parents the opportunity to guide their children as they learn the basics of digital finance. The company noted that young customers on its platform earned “nearly $150 million in allowances” and “contributed more than $140 million back into the global economy.”
As part of the agreement, Edison Partners managing director Chris Sugden will join gohenry’s board of directors.
“gohenry is catering to millions of parents who are looking to raise smart, financially literate children but are currently underserved by existing solutions,” Sugden said. “We’re thrilled to partner with Alex and the gohenry management team on this next milestone in their growth journey and look forward to realizing their ambitions to improve the financial fitness of kids across the globe.”
It’s been a grand week for Finland’s ReceiptHero. The company announced a few days ago that it was teaming up with SEB Kort to have its digital receipt functionality integrated into SEB Kort’s corporate card, Eurocard. Then, we learned that ReceiptHero had inked a deal with fellow Finovate alum ETRONIKA that will enable the launch of the first e-receipt solution in the Baltic region. The new offering will allow ETRONIKA’s business customers to use their KASU retail network management system and ReceiptHero’s technology to issue digital receipts to their customers.
“ETRONIKA has built a truly modern retail chain management and POS product and we are thrilled to be partnering on a wider partnership that allows us the initial steps of building out the Baltic ecosystem.” ReceiptHero CEO Joel Ojala said.
Today comes more news from the Finland-based fintech. Courtesy of an investment from VC Lifeline Ventures, Superhero Capital, and Vidici Ventures of Sweden, ReceiptHero has picked up $2.43 million (€2 million) in seed funding.
“We’re making some real strides now with merchants and potential bank partners,” Ojala said. “We’ve hit an inflection point where banks understand the potential of digital receipts and value for their customers. For merchants they feel safe with ReceiptHero protecting their customer data and payment information.”
Growing interest in ReceiptHero’s technology, which transmits digital receipts from merchants directly to customer banking or account apps, comes as Finland’s government has decreed that digital receipts will be mandatory by 2025. Finland launched a digital receipt pilot project in 2019 that saw more than 50,000 state workers shopping exclusively with merchants using ReceiptHero’s platform.
ReceiptHero made its Finovate debut earlier this year at FinovateEurope in Berlin. Headquartered in Helsinki, the company is also partnered with Nordea, integrating its technology with the bank’s Nordea Wallet offering at the beginning of last year. Other recent ReceiptHero partners include SKJ Systems, Diebold Nixdorf, and global IT system integrator CGI.
Venture investing platform OurCrowd is taking home an investment of its own this week. The Israel-based company announced today it received $60 million in capital from Japan-based ORIX. The investment brings OurCrowd’s total funding to $172 million.
The goal of the funding and strategic partnership is to bring opportunities for Israel-based startups in the Asia region and will strengthen trade between the two regions.
“We are excited about investing in OurCrowd, Israel’s most active venture investor and one of the world’s most innovative venture capital platforms,” said ORIX UK CEO Kiyoshi Habiro. “We intend to be active partners with OurCrowd and help them accelerate their already impressive growth, while bringing the best of Israeli tech to Japan’s large industrial and financial sectors.”
Today’s deal isn’t the first time OurCrowd has made Japanese ties. Last year the company teamed up with Toyota Tsusho Corporation, a Japanese general trading company, to scout for startups that support autonomous driving industry.
OurCrowd was founded in 2013 and offers a platform that allows its 58,000 users to invest in 220+ pre-vetted startups and 23 venture funds. Jonathan Medved is CEO.
Another day, another opportunity for Mastercard to find itself in the fintech headlines. Last week, we highlighted a handful of Finovate alums that earned spots in Mastercard’s Start Path program. Then, yesterday, we covered news that the company had enhanced its Mastercard Track Business Payment Service to help modernize business payments. We also reported on Monday that Mastercard had earned the go-ahead from the U.S. Department of Justice to complete its big acquisition of data aggregation innovator Finicity.
Today’s Mastercard-related performance comes in more of a “Best Supporting” role as the company – along with VC firm MissionOG – announces an investment in payments facilitator-services provider Infinicept. The amount of the funding was not disclosed, but Infinicept’s co-CEO and co-founder Todd Ablowitz highlighted adding engineering talent and investments in product management and customer service as ways Infinicept plans to put the new capital to use. He also said that Infinicept is experiencing a 8x growth rate, as well.
“The opportunity in front of us is enormous, and we’re going to invest intelligently and aggressively to meet the needs of our customers,” added Deana Rich, co-founder and co-CEO of Infinicept. “Our customers need the ability to get payments up and running on their own terms, without having to do all the work themselves. While others try to lock-in customers with templated solutions, Infinicept puts software companies in control of their payments experience – and their payments future.”
Infinicept enables businesses to offer embedded payments to a wide variety of customers, including in health care management and hospitality. Infinicept’s platform offers software providers, financial institutions, marketplaces, and more a payments infrastructure that can help them generate payments revenue, onboard merchants faster, and improve the overall customer experience.
This week’s investment is the latest expression of a partnership between Mastercard and Infinicept that extends back to 2012. Infinicept is an alum of Mastercard’s Start Path accelerator, joining the program as part of the 2019 cohort. Infinicept’s first customers were Stripe and Shopify in 2011.
“Infinicept’s technology now supports acquirers and payment facilitators with the critical tools to help businesses around the world manage payments,” Mastercard EVP of Merchant Solutions and Partnerships Zahir Khoja said. “Mastercard’s technology and scale, with partners such as Infinicept, is helping our larger acquirer ecosystem support businesses around the world to accelerate growth, modernize transactions, and ensure businesses have the tools to succeed.”
Founded in 2011, Infinicept is headquartered in Denver, Colorado.
Embedded finance and payments platform Hydrogen announced a strategic investment today. FINLAB, a new incubator launched by EML Payments, completed what Hydrogen called an “initial investment” that will include a cross-platform integration that will make it easier for firms to offer smart apps linked to both physical and virtual payment cards.
“We are thrilled to be working with EML and have it as a strategic investor in Hydrogen,” company co-founder and CEO Mike Kane said. “Together, we’ll be able to bring innovative card offerings to the masses, making it easy for any organization to offer card capabilities. It’s embedded card services made easy.”
The terms of the investment were not disclosed. Hydrogen currently includes both SixThirty and Route 66 Ventures among its investors.
Hydrogen’s no-code platform enables financial and non-financial companies to offer fintech products and modules without needing to have any development experience. Those organizations with development teams can take advantage of Hydrogen’s low-code API option, which enables developers to build custom apps on top of REST-based APIs. Featuring orchestration, business logic, and data cleansing, the platform enables businesses to leverage a standardized data model that can help keep costs of integration low and the development time short.
“We love cementing deals and investing in payments trailblazers,” EML Managing Director and Group CEO Tom Cregan said. “Hydrogen, with the intensity of energy it has already infused into the industry, is no different. Our commitment is to assist this fast-growing entity in soaring within fintech via EML’s capabilities and FINLAB. It’s heartening to know Hydrogen feel in safe and trusted hands with the might of EML’s global reach.
Making its debut at FinovateEurope two years ago, Hydrogen announced in September that it was one of 20 companies selected to participate in Plug and Play’s 2020 Winter Fintech batch. Also that month, the company unveiled a partnership with fellow Finovate alum Dwolla and teamed up with market data and technology service provider Barchart.
Among its accolades, Hydrogen has been named FinTech Startup of the Year by KPMG Luxembourg and as a World Changing Technology by Fast Company. The company was founded in 2017 and is headquartered in New York City.
Embedded banking-as-a-service platform Wisesecured $12 million in funding this week. The investment is its second one this year – Wise announced a $5.7 million seed round in April – and was led by e.ventures with participation from Grishin Robotics. The company, which made its Finovate debut last year at FinovateFall, said in a statement that the capital will be used to help fuel growth and accelerate partnership-building in a number of verticals. Wise now has raised a total of $18 million in equity financing.
“We built banking so our partners don’t have to,” Wise CEO and co-founder Arjun Thyagarajan said. “By embedding banking, Wise unlocks deep product offerings and better customer experiences for our partners. e.ventures built a thesis on exactly this, and we agree 100%.”
Wise offers an embedded banking experience that gives small businesses a seamless way to bank, as well as make and accept payments. Companies partner with Wise and leverage its all-in-one business banking solution to offer accounts to their own clients such as e-commerce platforms and marketplaces. In addition to providing a fully-hosted and fully-serviced banking experience, Wise helps companies bridge the gap between what they have traditionally received from banking services and what e.ventures partner Brendan Wales called “an Apple-like experience” brought to the world of business banking.
“Business banking has been broken for far too long. Poor user interfaces, payments delays, unnecessary fees, a lack of integrations, the list goes on and on,” Wales said. Now, cloud-based B2B companies can offer banking services in a matter of days with no coding involved and have the entire operation managed and maintained by Wise.
Wise demonstrated its small business-banking-in-a-box solution at FinovateFall 2019. A Techstars NYC company based in San Mateo, California, Wise was founded in 2018. Check out our profile of the company from earlier this year.
U.K.-based payments technology providerIcon Solutions is getting a boost today from U.S. banking giant JP Morgan in the form of a strategic investment.
The amount of the investment, along with specific terms of the deal, remain undisclosed.
“We’re excited to support Icon with this strategic investment as they look to continually build a simplified, collaborative payments ecosystem, driving emerging payments rails and innovation,” said Sara Castelhano, EMEA Head of Payments, Digital, and Solutions at JP Morgan Wholesale Payments.
As part of today’s deal, Icon has added Castelhano, to its Board of Advisors.
Icon will use the funds to expand development of its Instant Payments Framework technology, a collaborative, open source payments platform that helps clients process instant payments.
To facilitate these instant payments for U.S. clients, Icon has teamed up with The Clearing House to offer an accelerated route to accessing The Clearing House’s (TCH) real-time payments system. The company has also partnered with Featurespace to facilitate integration and block fraud attacks at scale and in real time.
“We will directly benefit from the support, scale and insight of a global banking leader and one of the most visionary technology companies in the world, while retaining our flexibility and independence,” the company said in a blog post. “We can now accelerate our strategic roadmap, invest more in our technology and team, and expand our geographic reach.”
The investment comes at a pivotal time in the U.S. payments scene. The U.S. Federal Reserve is lagging behind the rest of the globe in launching a real-time payments and settlement service, anticipating a delay until 2024. As the current speed of payments fails to meet consumer expectations, which have evolved to demand the delivery of everything from messages to groceries in real time, private players are coming to the market with their own solutions.
In a round led by Macquarie Capital Principal Finance, payment and data security technology company Bluefin has raised $25 million in new financing. With total capital now standing at more than $30 million, the company said the funding would “fuel” its product line, help drive growth internationally as well as within the U.S., and support “opportunistic acquisitions.”
In its statement, Bluefin put this week’s investment, and the growth opportunities for the company, in the context of changes taking place as a result of the global health crisis. Noting that the pandemic has increased reliance on mobile point of sale devices, Bluefin warns that this means the number of potential attack entry points for hackers and cybercriminals has also increased. With an estimated 27.7 million mobile POS devices in use by 2021, Bluefin argues that additional security to defend private data will be required for all businesses, regardless of their sales hardware preference.
“Bluefin is dedicated to remaining at the forefront of technology and solution development in the fight against breaches and cyberattacks,” Bluefin CEO John M. Perry said. “Our partnership with Macquarie will enable Bluefin to not only introduce more solutions to protect e-commerce, online and point-of-sale transactions, but also to make these solutions available globally through our extensive partner network and Bluefin’s products. We look forward to leveraging Macquarie’s deep financial and global expertise in this next phase of company growth.”
A specialist in securing Personally Identifiable Information (PII), Protected Health Information (PHI), as well as financial card data, Bluefin leverages PCI-validated point-to-point encryption (P2PE) and tokenization to safeguard information upon entry, in transit, and in storage. Bluefin’s technology enables secure payment acceptance for card present, e-commerce, and mobile transactions, and is available via its network of 130+ integrated partners or directly through the company.
“Bluefin has developed industry-leading data and payment protection technologies, which are crucial in the global climate of rising data breaches and cyberattacks against organizations of all sizes,” Macquarie Capital Principal Finance Managing Director Anand Subramanian said. “We are very pleased to partner with this innovative company to expand their cybersecurity product suite and fuel continued growth in the U.S. and internationally.”
An alum of our developers conference, FinDEVr Silicon Valley, Bluefin announced a partnership with CPA Site Solutions in September, enabling the accounting website provider to offer enhanced online billpay. In August, the company teamed up with electronic bill presentment and payment (EBPP) solutions provider Invoice Cloud.
Brokerage infrastructure API provider DriveWealthbrought in $56.7 million in Series C funding today. The investment is more than double the Series B round of $21 million the company received in 2018. Today’s investment brings the company’s total to $100.8 million.
The round saw participation from existing investors Point72 Ventures– which led the round– as well as Raptor Group, SBI Holdings, and Route 66 Ventures. New investors Mouro Capital and Fidelity International Strategic Ventures also participated.
DriveWealth will use the funds to strengthen its technology, make strategic acquisitions, and grow the organization to scale its business.
The New York-based company offers a suite of APIs that allows its partners to embed investment experiences of U.S. securities within their own apps. Among DriveWealth’s products are tools for advisors, fractional share investing, and purchase round-up investment capabilities.
“DriveWealth saw its partners open more accounts in 2Q than E*Trade, Schwab and TD Ameritrade combined, and 3Q saw a 33% increase over 2Q,” said DriveWealth Founder and CEO Bob Cortright. “This type of activity speaks to the power of making it simple for consumers to start investing immediately. The new funding from our great investors will only help us improve our technology capabilities to democratize investing.”
Since it was founded in 2012, DriveWealth has already scaled its business to serve a range of geographies and now reaches investors in 153 countries. The company has formed partnerships with firms on six continents, including Asia, where it collaborated with Singapore-based Bambu on the launch of a white-label roboadvisory platform for U.S. wealth managers; and Africa, where the company teamed up with Sigma Securities and Trove Technologies to launch a digital U.S. equities trading product for retail investors in Nigeria.
Among DriveWealth’s clients are Hatch, Revolut, Stake, and Moneylion. The company recently partnered with Access Softek to help community banks and credit unions offer their members access to investing tools.
