Lendio Lands $55 Million to Match Small Businesses with Lenders

Online marketplace for small business loans Lendio landed $55 million in combined debt and equity funding today. The investment more than doubles the company’s previous funding, bringing its total to $108.5 million.

The equity portion of the Series E round was led by Mercato Partners’ Traverse Fund, which contributed $31 million, and included contributions from existing investors Napier Park Financial Partners, Comcast Ventures, Blumberg Capital, Stereo Capital, and Runa Capital. Signature Bank led the debt facility with $24 million.

Founded in 2011, Lendio serves as a matchmaker that connects small businesses seeking funding with its network of over 75 lenders. Since Lendio launched at FinovateSpring in 2011, the Utah-based company has funded more than 100,000 loans totaling $2 billion. Over the past two years, Lendio has seen an average year-over-year growth rate of 75%.

CEO Brock Blake called today’s investment a “significant milestone” for the company. “With these funds, we are strongly positioned to grow our existing platform as a trusted loan facilitator that supports both lenders and borrowers, while building out a range of new integrated lending services that get the right loans into the right hands at the right time.”

Lendio will use today’s investment to increase the scope and precision of its flagship loan marketplace; expand lender services functions, which provide lenders access to a white-labeled online loan application; and enhance its small business bookkeeping platform, Sunrise by Lendio. The company launched Sunrise last year after acquiring online bookkeeping startup Billy. The new service aims to help Lendio’s small business clients manage their cash flow and monitor their overall financial health.

“Lendio’s ability to combine data analytics with the human touch to connect small businesses quickly and precisely with ideal lending partners has made all the difference in its success,” said Ryan Sanders, senior investor at Mercato Partners Traverse Fund. “Lendio uniquely solves the problem of inefficient capital for small businesses by bridging lenders and borrowers. They are able to connect both sides and facilitate loans faster and more effectively between small business owners and lending institutions. Lendio’s impressive growth is a result of its technology-backed personalized service which has created a loyal and growing following in the industry.”

London’s B-Social Raises $10 Million in Seed Funding Ahead of Bank Rebrand

Continental challenger banks like N26 may be pulling away from the U.K. market. But that is only creating room for newcomers like London’s social payments app B-Social which has raised $10 million (£7.8 million) en route to its transformation into Kroo, a fully-licensed bank.

The funding, part of a seed round, brings the company’s total capital to more than $17.8 million (£13.25 million). Participating in the round was Karlani Capital’s Rudy Karsan, along with additional undisclosed investors.

“Our seed 2 funding round is another key milestone towards building the greatest social bank on the planet and changing the relationship people have with money for good,” B-Social CEO Nazim Valimahomed wrote on the company’s blog. He noted that B-Social has signed up more than 9,000 users and will soon introduce functionality to enable account funding via bank transfer. Valimahomed also added that the company plans to double the size of its team at its headquarters in Holborn.

Most significantly, the investment will help B-Social as it transitions into becoming a bank, to be called Kroo. Valimahomed said that the company is currently in the final, pre-application phase for obtaining a U.K. banking license and hopes to finish the application process “in the very near future.” He referred to the rebrand as a change to an “exciting new brand that fully embodies who we are – intuitive, talented, empowering, social, and collaborative.”

Founded in 2016, B-Social helps users manage shared expenses. The company’s app, available in both iOS and Android, supports bill splitting and group expense tracking, and instant payments between B-Social account holders. The solution also comes with a contactless debit Mastercard that can be used, fee free, both at home and abroad wherever Mastercard is accepted.

Revolut’s $500 Million Round Boosts Valuation to $5.5 Billion

Global financial platform Revolut has secured its place as the U.K.’s most valuable fintech. The London-based company secured a $500 million investment, bringing its total funding to $836 million.

With this, Revolut’s valuation tripled, escalating to $5.5 billion. As a comparison, digital bank Monzo was valued at $2.6 billion last year. Revolut’s funding was led by U.S. investor Technology Crossover Ventures while a handful of undisclosed existing investors also contributed.

The funding will be used to enhance Revolut’s customer experience, grow its workforce, and create new products that entice users to log into their accounts more frequently. As a part of this, Revolut will use the funds to enhance Premium and Metal subscription account offerings. These paid products are not only a significant part of Revolut’s business model, they also show huge promise, growing by 154% last year alone.

“We’re on a mission to build a global financial platform – a single app where our customers can manage all of their daily finances, and this investment demonstrates investor confidence in our business model,” said Revolut CEO and founder Nik Storonsky. “Going forward, our focus is on rolling-out banking operations in Europe, increasing the number of people who use Revolut as their daily account, and striving towards profitability.”

Revolut employs 2,000 people across 23 global offices. The company counts more than 10 million customers and has processed one billion transactions worth $130 billion since it was founded in 2013.

The company has seen significant success since its early days. Just last year Revolut increased customer growth by 169%, boosted the number of daily active customers by 380%, and saw year-over-year financial revenues grow by 354%. The company aims to continue this growth by launching lending services for retail and business customers, extending high interest savings accounts beyond the U.K., improving customer service, and rolling out banking operations across Europe.

Self Raises $20 Million to Help Americans Improve Their Credit

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For consumers with credit scores below 600, options for securing financing can be a major challenge. A new company on the scene, Self, has locked in $20 million in new funding to help make those financial hurdles a little easier for Americans with poor credit histories to overcome.

In a Series C round led by Altos Ventures and Conductive Ventures, Self has added $20 million to its total capital, which now stands at $37 million. The Austin, Texas-based company, founded in 2015, offers a Credit Builder Account in which borrowers apply for a modest loan with a Self bank partner that is held on a certificate of deposit. Borrowers make monthly payments, which are reported to the major credit agencies to help establish a credit history. Once the term is complete, the CD matures and the principal amount comes back to the customer.

“Our goal from the beginning was to create a mission-driven company that gives the power back to consumers and helps them achieve their financial goals,” company founder and CEO James Garvey said.

Since inception, Self has worked with 500,000+ customers and provided $400 million in CD-secured loan originations. The company recently launched its Self Visa Credit Card, a secured card that does not require a credit check. The card allows holders to build their security deposit in installments rather than with one large deposit upfront. The card has an annual fee of $25, average for secured cards, but features a higher than average minimum APR for secured cards at 23.74% based on a review by U.S. News.

Named one of the best fintech places to work in 2020 by Ariznet Brands – publishers of American Banker – Self rebranded itself from Self Lender last August and reincorporated as Self Financial. The fintech has partnered with firms including Atlantic Capital Bank, an Atlanta, Georgia-based bank holding company with assets of $2.9 billion, income optimization platform Steady, and nonprofit social enterprise Neighborhood Trust Financial Partners.

“Self inspires us with their dedication to helping consumers take control of their financial future,” Conductive Ventures’ Paul Yeh said. “Today, it’s imperative to be aligned with partners with a shared vision that is meaningful and delivers change for the greater good.”

Flywire Closes $120 Million Investment, Acquires Healthcare Payments Platform

It’s a big week for Flywire. The global payments platform made a dual announcement yesterday that it closed a round of funding and sealed the deal on an acquisition.

The $120 million in funding brings Flywire’s total raised to $260 million. Goldman Sachs led the Series E round. The Massachusetts-based company will use the funding to digitize payments across education, healthcare, and travel.

“We are thrilled to lead the Series E round for Flywire”, said Ashwin Gupta, Managing Director at Goldman Sachs’ Merchant Banking Division. “They bring together a unique blend of a payments network, platform and vertical-specific solutions to completely digitize the payments experience for their clients across industries. We look forward to continuing to help accelerate Flywire’s growth.”

Along with the investment news, Flywire unveiled that it has acquired healthcare billing and payment solutions company Simplee for an undisclosed amount. The acquisition blends Flywire’s tech platform with Simplee’s solution that focuses on patients and providers. The combined companies power four of the top ten U.S. healthcare systems and together process $10 billion+ in payments per year.

“Flywire is uniquely built on a global payments network, which is the cornerstone of how we move billions of dollars across 200+ countries and 150 currencies, and an industry-leading payments platform” said Flywire CEO Mike Massaro. “This digital foundation enables us to develop vertical-specific applications that make payments more efficient and cost-effective for our global clients. The Simplee acquisition improves patient engagement and healthcare affordability and extends these capabilities to a broader customer base.”

Flywire, which originally launched has peerTransfer in 2009, has processed $12 billion+ in payments for 2,000 clients. The company has office locations at its headquarters in Boston, as well as Chicago, London, Manchester, Valencia, Shanghai, Singapore, Tokyo, Cluj, and Sydney. 

Fenergo Raises $80 Million from ABN AMRO Ventures and DXC Technology

Digital banking and client lifecycle management solutions provider Fenergo brought in $80 million in funding today, bringing its total raised to $155 million and boosting its valuation to $800 million.

The funds come from new investor ABN AMRO Ventures and existing investor DXC Technology, which have taken a 10% stake in Fenergo. “We are very happy to add Fenergo to our investment portfolio,” said Hugo Bongers, Director at ABN AMRO Ventures. “This investment will contribute to ABN AMRO’s strategic priority to build a future proof bank and fight financial crime. We are impressed with the management team and solution Fenergo offers. In addition, this gives us additional exposure to a group of tier one investors.”

Fenergo will use the funds to bolster its products and hinted that the money will also fuel future company and product acquisitions.

Founded in 2009, Fenergo aims to help financial institutions revamp their client onboarding process by creating a seamless user experience while maintaining regulatory compliance. Demand for the company’s modern onboarding tools can be seen in the growth of its bottom line; last year, Fenergo grew its revenue by 21%.

The Dublin-based company boasts 70 clients, including two of its investors, ABN AMRO and BNP Paribas. Also on the list are ANZ, PNC, Banc of California, National Australia Bank, Canadian Imperial Bank of Commerce, UBS Asset Management, Anglo Gulf Trading Bank, Royal Bank of Canada, First Abu Dhabi Bank, Tricor, Exos Financial and Mizuho.

Starling Bank Flies with $77.5 Million in New Funding

Top U.K.-based challenger bank Starling Bank raised $77.5 million (£60 million) from existing investors Merian Global Investors and JTC.

Today’s investment brings Starling’s total funding to $417 million (£323 million).

“The support of our existing investors represents a huge endorsement of our business strategy, as we continue to ramp up our growth,” said Anne Boden, Starling Bank founder and CEO. “We’re constantly innovating and have big ambitions to turn Starling into a world-leading digital bank.”

Starling will use the funding to support “rapid expansion” efforts and to create products and services that compete with traditional financial institutions. Helping motivate its employees to push for this expansion, the bank is awarding shares to its staff.

“We could not do this without the support of our 800 employees, who work so hard to provide a better banking experience for our customers, giving them more control over their finances. So I’m thrilled to be giving shares to them,” said Boden.

Since launching its banking app in 2017, Starling has amassed 1.25 million accounts and holds $1.61 billion (£1.25 billion) in assets under management. The bank was founded in 2014 and is headquartered in London with offices in Southampton, Cardiff, and Dublin.

Currencycloud Raises $80 Million in New Funding

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B2B cross border payments innovator Currencycloud has locked in $80 million in new funding.

Visa, the International Finance Corporation, BNP Paribas, SBI Group, and Siam Commercial Bank participated in the Series E. Existing investors Sapphire Ventures, Notion Capital, GV, Accomplice, and Anthemis were also involved in the round.

“Currencycloud is re-imagining how money flows around the global economy and embedding it into (the) platforms of the future,” company CEO Mike Laven said. “Transfer of value is fast becoming the newest layer in the modern technology stack, and Currencycloud is positioned to provide the infrastructure to make this happen.” He added that the funding makes Currencycloud “the go-to provider for the next wave of fintech innovation.”

This week’s investment takes Currencycloud’s total capital to more than $140 million. In its statement, the company said that it plans to use the new funds to grow its portfolio of payment methods and further develop its partner ecosystem.”

A global payments platform, Currencycloud offers 85 different APIs across four modules – collect, convert, manage, and pay – that support the entire B2B cross-border payments workflow. The London-based company, founded in 2012, demonstrated its Global Collections offering at FinovateSpring in 2018. Global Collections makes it easier for firms to collect payments from overseas customers by setting up local, virtual bank accounts in their names. This helps keep payment costs low and ensures that payments arrive promptly and in-full with as little, cross-border hassle as possible.

Earlier this month, Currencycloud announced a partnership with TransferGo that will help it launch in 14 new markets in the first quarter of this year. Named to the 2020 Fintech Power 50 in December, Currencycloud previewed its multi-currency accounts solution, Currencycloud Spark, last fall. The technology enables firms to offer their business customers multi-currency accounts that allow them to collect, store, convert, and make payments in 35+ currencies.

Currencycloud has processed more than $50 billion in cross-border payments processed since its inception. The company includes fellow Finovate alums Revolut, Klarna, and Dwolla among its partners.

AvidXchange Secures $260 Million in New Capital, Earns $2 Billion Valuation

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Does fintech have its first “double unicorn” of 2020?

Leading accounts payable and payments automation solution provider AvidXchange has secured $260 million in equity funding in a round involving TPG Sixth Street Partners as well as other investors. The funding will power the company’s continued growth and takes AvidXchange’s total capital to more than $800 million. The investment also likely boosts the company’s valuation to more than $2 billion.

“We’re shaping the future of the B2B payments industry by fundamentally changing the way businesses pay their bills,” AvidXchange CEO and co-founder Michael Praeger said. “(We) provide a single platform for AP and payments with the largest payments network for the middle market.”

Praeger noted that even in 2019 more than 60% of businesses in the U.S. relied on paper checks to pay bills, generating $2.7 trillion in annual administrative costs. AvidXchange enables mid-market businesses to avoid this expense by automating invoice and payment processing in a single platform. the company processes 9.5 million payments a year via its network of more than 500,000 suppliers.

The funding announcement comes as the company reports that new acquisition BankTEL has secured its first partnership leveraging AvidXchange’s AvidPay solution. BankTEL will collaborate with Studio Bank, a Nashville, Tennessee-based boutique bank, which will use the platform to automate and streamline their AP to payment process.

AvidXchange was named to the Inc. 5000 list in November and earned a spot on the Forbes Cloud 100 list in October. Last year, the company also added 175 new workers, taking its total workforce to 1,400+ across seven offices. Headquartered in Charlotte, North Carolina, AvidXchange was founded in 2000.

FinovateEurope Alums Reel in $940 Million in 2019

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With FinovateEurope less than a month away, we thought we’d take a look at some of the fundraising success the conference’s alums had in 2019.

From companies that demoed at our very first FinovateEurope in 2012 to some of FinovateEurope’s newest players, alums of our European conference raised more than $940 million in funding last year. We’ve listed the companies below in alphabetic order, along with a link to their demo so you can learn more about the company and its work.

Looking to showcase your latest fintech innovation on stage? Send us an email at heather@finovate.com to find out how to become one of our demoing companies next month at FinovateEurope in Berlin, Germany, on February 11 through 13.

And if you haven’t picked up your ticket yet, run, don’t walk, to our registration page and save your spot today! Take advantage of big savings by signing up before January 31.

24sessions: $1.1 million – postFEU19 demo

Aire: $11 million – postFEU15 demo

Bitbond: $2.3 million – postFEU15 demo

Capitalise: $4.5 million – postFEU16 demo

Currencycloud: $12.2 million – postFEU14 demo

Dashlane: $110 million – postFEU13 demo

DataSine: $5 million – postFEU18 demo

Featurespace: $32.2 million – postFEU16 demo

Fintech OS: $1.2 million – postFEU18 demo

Flybits: $35 million – postFEU19 demo

Kantox: $5.7 million – postFEU13 demo

Minna Technologies: $6.3 million – postFEU19 demo

nCino: $80 million – postFEU17 demo

Nutmeg: $58 million – postFEU12 demo

Onfido: $50 million – postFEU18 demo

Passport: $65 million – postFEU16 demo

PaySend: $10.6 million – post – and $5.3 million –postEU16 demo

Scalable Capital: $28 million – postFEU16 demo

Tink: $11.2 million – post – and $63 million – postFEU19 demo

Token: $16.5 million – postFEU17 demo

TransferWise: $292 million – postFEU13 demo

Twisto: $15 million – post – and $15.7 million – postFEU18 demo

YellowDog: $3.3 million – postFEU19 demo

How Trusona Stops the Funding of Evil

If you’ve ever been hacked, having either money or personal credentials stolen, did you stop to think about what type of person, organization, or agenda you were inadvertently supporting?

“Let’s talk about the funding of evil,” said Trusona founder and CEO Ori Eisen during his first Finovate demo. “When a bank loses $10 million, it’s not a good day for the bank. But where the money goes and what it’s being spent on is not good either.” Eisen then turned to the audience to suggest their responsibility in the matter. “You can help stop or curb the funding of evil,” he added.

At first I thought he was joking. Discussion of the “funding of evil” and “stopping the bad guys” sounded like something straight out of a kid’s TV program. However, it’s no joke and it’s unnerving to think of what these “bad guy” fraudsters do with their stolen cash.

In the demo, Eisen went on to explain that one way to curb funding these fraudsters is to make user’s accounts more secure. And in Trusona’s opinion, the best way to do that is to get rid of passwords entirely. The Arizona-based company just raised $20 million this month in support of this concept– getting rid of the password. The investment brought Trusona’s total funding to $38 million.

So what does web authentication look like without a password? The 30 second process requires the user to have their smartphone with them, but doesn’t require access to a cellular network. Upon logging in, the user clicks Login with Trusona. The web interface shows a unique QR code, and the user then opens the Trusona app on their smartphone, scans the QR code, and taps to accept. Once complete, the user can enter the website without the need for a username or password.

In addition to simple authentication, Trusona also offers solutions for ID scanning and proofing, multi-factor authentication, and VPNs.

The need for such a solution stems from faulty password management skills common among consumers and employees today. In fact, last year Trace Security reported that 81% of company data breaches were caused by poor passwords. Trusona offers an SDK that businesses can integrate into their own app to simplify logins for both employees and end customers.

With its recent funding, Trusona said it will focus on expanding its customer base as well as begin working on new product offerings.

Trusona was founded in 2015 and counts Aetna, Kleiner Perkins, and Bain Capital among its clients. The company has demoed at Finovate twice and won Best of Show awards at both of its appearances. Check out Trusona’s most recent demo below.

French Fintech Lydia Locks in $45 Million

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TechCrunch reported this morning that French mobile payment app Lydia has raised $45 million (€40 million) in a round led by Tencent. With existing investors CNP Assurances, XAnge, and New Alpha also participating in the Series B, Lydia adds significantly to the more than $16 million (€13 million) the company raised in 2018. The funding will help propel the firm toward its self-described goal of being the “PayPal of the new mobile generation.”

Lydia is used to make P2P payments, link and share accounts, as well as access a marketplace of additional financial offerings such as lending products and insurance. Available as a free app with other premium services available, Lydia can also set up recurring payments and enable users to pay with their smartphone via Apple Pay, Google Pay, Samsung Pay, or QR code. Company co-founder and CEO Cyril Chiche pointed to the growing numbers of French consumers who are using the app for a variety of money management functions, highlighting the fact that 25% of French consumers between the ages of 18 and 30 have a Lydia account. Chiche added that the technology has three million users across Europe.

Lydia, which was founded in 2013, will use the funding to fuel its continued expansion in Europe. Lydia is particularly keen on opportunities to reach millennial Europeans in markets like the U.K., Ireland, Spain, and Portugal – where its app was deployed in the second half of 2017.

Compared to other countries in Europe, the fintech industry in France is often overlooked. This is not wholly without foundation. According to the recent report on European fintech by Dealroom, the share of fintech related VC spending in France in recent years was 12% compared to 20% in Europe overall, 21% in Germany, and 30% in the U.K. Born2Invest noted in December that French fintech startups had raised $700 million in 2019, and suggested that this year would likely see “a lot of talk about assuretech” also known as insurech, where technologies like digitization and automation are able to make dramatic differences in data management.

Lydia was featured in Silicon Canals last spring in its look at “10 exciting French fintech startups to work for in 2019.” For more on the French fintech industry, check out this infographic from BlackFin Tech which depicts the five main ecosystems in French fintech – regtech, assurtech, financial services, banking/PFM, and payment services – as well as some of the major players.