Funding

Western Union Takes Strategic Stake in Walletron

Western Union Takes Strategic Stake in Walletron
By David Penn Posted on
Categories: Funding, Fundings, Walletron

walletron_homepage_december2016

Walletron, the company that hopes to make accessing your mobile wallets as easy as using your digital boarding pass at the airport, has just won a strategic investment from Western Union. Khalid Fellahi, SVP and GM for Western Union Digital, said his firm’s partnership with Walletron helps reinforce Western Union’s commitment to the mobile channel, which he calls “our priority customer-engagement channel” for both money transfer and payments.

Walletron’s technology is an SaaS platform that manages the content and appearance of digital cards in a mobile wallet such as Wallet and Android Pay. The company’s moBills solution enables billers to put a payment and presentment channel on customers’ smartphones to provide for faster payment, important reminders and notifications, and more.

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Walletron CEO Garrett Baird demonstrated moBills at FinovateFall 2015.

The strategic investment—amount undisclosed—comes just a few months after the two companies announced a commercial alliance between Walletron and Western Union’s billpay service, Speedway. The alliance enables Western Union biller clients to add Walletron’s moBills solution to take advantage of personalized notifications, bill information, and other features using their smartphones.

Nasdaq.com reported that Western Union’s investment in Walletron is part of an effort to expand its presence in the mobile payments space. The company’s own research indicates that 27% of all consumers and 48% of Gen Y consumers expect to pay more bills by a mobile device. Mobile World Live compared the Walletron investment to Western Union’s partnership with messaging app WeChat back in November 2015, and noted the company’s competition from mobile remittance/money transfer startups such as Azimo and Xendpay.

Founded in 2013 and headquartered in Philadelphia, Pennsylvania, Walletron demonstrated its moBills solution at FinovateFall 2015. Check out our Finovate Debut profile of the company from this summer.

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Tradeshift Earns Undisclosed Investment from Santander

Tradeshift Earns Undisclosed Investment from Santander
By David Penn Posted on
Categories: Funding, Fundings, Tradeshift

tradeshift_homepage_december2016

Tradeshift is the latest company to pick up an investment from Santander InnoVentures, the fintech-based venture capital fund run by Santander Group. The new capital will help Tradeshift develop its supply-chain finance platform and add to the company’s B2B marketplace.

Terms of the investment were not disclosed. Tradeshift had raised more than $190 million in total capital ahead of this week’s investment, with its latest infusion of capital a $75 million funding round led by Data Collective from this summer.

Calling Santander “a natural fit,” Tradeshift CEO and Chairman Christian Lanng praised the Spanish bank for its history of collaborating and partnering with its portfolio companies. “We are excited by the opportunities this investment will create to explore new offerings and different geographies around the world,” Lanng said. Santander InnoVentures’ managing partner Mariano Belinky said Tradeshift is “at the forefront of tackling a very real business need” and using innovative technology to do so.

“Tradeshift has built an open business network on a scalable cloud-first platform that is extensible by third-party applications,” Belinky explained. “This architecture is a key differentiator. As a result, the potential to provide complimentary and added-value services around the Tradeshift platform is particularly powerful.

The investment news comes just days after Tradeshift announced the launch of a pair of new joint ventures in China. The initiatives are designed to help meet the country’s growing demand for supply-chain digitalization and feature partnerships with Shenzhen XunLian Technology Development Company in Chongqing, and Chinese tax-related services provider, Baiwang. “Our platform vision puts both buyers and their suppliers at the center of our value proposition,” Tradeshift SVP of Asia Pacific, Mikkel Hippe Brun said during the joint venture announcement. “(It) is proving to be a natural fit in China’s trade ecosystem as it is everywhere else,” Brun said. Earlier this fall, the company announced expansion to Australia and New Zealand, and was named to Battery Ventures/Glassdoor’s 50 Highest Rated Private Cloud Companies to Work For. In June, Tradeshift introduced its B2B virtual assistant for managing business and travel expenses, Go.

Founded in 2010 and headquartered in San Francisco, Tradeshift demonstrated the Instant Payments feature of its platform at FinovateEurope 2012. Tradeshift’s platform links 800,000 companies across 190 countries.

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Seattle-based Finagraph Completes $5 Million Financing

Seattle-based Finagraph Completes $5 Million Financing
By David Penn Posted on
Categories: Finagraph, Funding, Fundings

finagraph_homepage_november2016

In a round led by Moody’s Corporation, financial business data specialist Finagraph has raised $5 million in funding. The company, which demoed at FinovateSpring 2013 as BBC Easy, will use the fresh capital for both product development as well as increasing its market reach in North America.

“Finagraph streamlines the data collection process by replacing weeks of back-and-forth emails and phone calls with the click of a button, instantly transferring financial and credit information,” Finagraph CEO James Walter explained. “Harnessing the power of technology to automate the exchange of financial information between parties is transformative,” he said.

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From left: Finagraph co-founders James Walter, CEO, and Corey Ross, VP sales, demonstrated BBC Easy at FinovateSpring 2013.

This is not the first time Moody’s has expressed interest in the company. Earlier this year, we reported that Moody’s had taken a minority stake in Finagraph, though the amount of the investment was not disclosed. At the time, Mark Almeida, president of Moody’s Analytics, said Finagraph’s technology would help “bankers make better, faster lending decisions for the growing SME market.” The current $5 million investment from Moody’s includes that funding from this spring, as well as recent contributions from other investors.

Finagraph’s flagship technology is its Finagraph Engine, which gathers, processes, and analyzes SME financial data quickly with 100% accuracy. Lenders can add the Finagraph Engine to their loan-origination system or app to better collect key business data as well as compare performance against various benchmarks as well as varying time periods. Finagraph also provides its BBC Easy solution, which automates the borrowing base certificate process for lenders and SMEs, and Finagraph Academy, a collection of webinars and seminars for bankers and business owners that provide guidance on building client relationships, managing business finances, and more.

Founded in 2010 as BBC Easy and rebranding as Finagraph in 2013, the Seattle-based company demonstrated its Base Borrowing Certificate technology at FinovateSpring. In September, Finagraph’s technology was leveraged by Moody’s Analytics to build its MARQ portal, which automates the exchange of financial data between borrowers and lenders, generating the MARQ small business score in the process.

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Five Degrees Raises $10 Million in New Funding

Five Degrees Raises $10 Million in New Funding
By David Penn Posted on
Categories: Five Degrees, Funding, Fundings

fivedegrees_homepage_november2016

A new investment of more than $10 million (€10 million) will help core banking technology provider Five Degrees focus on both product development and global expansion. The funding comes courtesy of new investor Karmijn Kapitaal and existing investors, 5Square and Velocity Capital.

Calling Karmijn Kapitaal “more than just a new shareholder,” Five Degrees CEO Martijn Hohmann said the investment was a “sign of trust in our belief that delivering top technology is about people and creating an environment that is about unconventional thinking brought to perfection.” Karmijn Kapitaal partner Hadewych Cels added that the investment in Five Degrees represented a “unique opportunity to broaden” his firm’s portfolio. “We see Five Degrees as a winner in FinTech,” Cels said.

Five Degrees’ Matrix digital banking platform provides retail and private banks with a fully automated solution that supports any product or channel via a web-based, mid-office environment connected to either the client’s legacy back-office or Matrix’s. The technology can be deployed in a variety of pre-set configurations ranging from retail and SME banking to micro finance. The Matrix platform was recently deployed by LeasePlan Bank.

Five Degrees demonstrated its back-office solution, Matrix Accounts, at FinovateEurope 2016. This past spring, Five Degrees was named to FintechCity’s Fintech50 2016 and won the Banking & IT category at the Dutch Fintech Awards. Last summer, Five Degrees announced the addition of new chief commercial officer, Peter-Jan van de Venn. Five degrees was founded in 2009 and is headquartered in Breukelen, The Netherlands.

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Germany’s figo Picks Up $7 Million in Series B Funding

Germany’s figo Picks Up $7 Million in Series B Funding
By David Penn Posted on
Categories: Figo, Funding, Fundings

figo_homepage_november2016

Banking service provider figo has picked up an investment from strategic partner DB1 Ventures, the VC wing of Deutsche Börse Group. The “seven digit” investment gives Deutsche Börse a sizable minority stake in figo, and is designed to help fuel the company’s international expansion. Also participating in the round were “reputable business angels from Germany.” With the completed series B, figo raised more than $7 million (€ 6.8 million), and now has total capital of more than $12 million.

“In a changing financial landscape, figo has established itself as a reliable partner and has built up a fantastic fintech ecosystem around itself,” Deutsche Börse Managing Director Ankur Kamalia said. “We look forward to supporting their growth and also learning from the innovation they are driving.” Calling Deutsche Börse a “perfect partner” for his company, figo CEO André M. Bajorat (pictured) said the investment and strategic partnership will enable figo to “gain new enhanced visibility in the industry.”

figo_andrebajoratFounded in 2012 and headquartered in Germany, figo demonstrated its cloud banking API at FinovateEurope 2013. Europe’s first banking service provider, figo provides a banking API that enables third parties to connect apps and services to more than 3,000 FIs and financial service organizations. Operating in Germany and Austria, figo specializes in solutions to help companies with their Payments Services Directive strategies (PSD2). This, according to some, has been key to renewed investment interest in the company and was highlighted by Deutsche Börse’s Kamalia. “The figo team led by André Bajorat has made clear the opportunities that exist for virtually every player in the financial sector and the enormous potential that PSD2 implementation offers to European industry,” Kamalia said.

Last month, figo organized Hamburg FinTech Week, bringing together 85 programmers and product developers to focus on the latest innovations and trends in the German fintech scene. The event also featured a hackathon called Bankathon 2016 designed to promote development and create solutions based on PSD2 and XS2A (“access to account”). Access to account is a key component of PSD2, which encourages third parties to participate more directly in financial services, specifically in the areas of enabling financial data to be read and deployed in third-party services and solutions, as well as bank transfers using third-party apps. Writing about figo—the company’s recent funding and PSD2—Finance Magnates noted that figo’s embrace of PSD2 has “strategically placed itself at a key point in the payments realm, helping build a new banking infrastructure in a world hamstrung by open APIs.”

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Sezzle Raises Seed Funding Ahead of Shopify Debut

Sezzle Raises Seed Funding Ahead of Shopify Debut
By David Penn Posted on
Categories: Funding, Fundings, Sezzle

sezzle_homepage_november2016

It’s a good time to be Sezzle.

The alternative payments company that made its Finovate Debut earlier this year at FinovateSpring has just completed a seed round of funding, raising $1.85 million. The funding surpassed expectations, according to Sezzle founder and CEO Charlie Youakim, who stated that the company has seen continued interest from investors, oversubscribing their round. “Our ultimate goal is to be successful, even if the founding team ends up owning a little less,” he said. Participating in the seed round were Belgium’s E-Merge and China’s CSC Upshot, as well as “angels, superangels, friends and family.”

The funding for Sezzle accompanies news that the company will launch on Shopify with its first set of merchants. Sezzle is in final testing with clients now and expects to be able to announce the names of its merchant partners in mid-December. Merchants are expected to roll out the integration over the next couple of weeks, Youakim said.

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CEO and founder Charlie Youakim demonstrated Sezzle at FinovateSpring 2016.

Founded in January 2016 and headquartered in Minneapolis, Minnesota, Sezzle introduced its payment solution at FinovateSpring 2016. Sezzle is a payment platform that leverages bank sign-on technology and ACH rails to give merchants a cheaper option—fees of 1.5% and 15 cents for transactions—that is half the cost of credit cards and PayPal. At the same time, consumers using Sezzle benefit from rewards—currently 1% cash back—on purchases that are essentially debit-card transactions. “Typically, people convert to credit cards because of rewards,” Youakim explains, “but there are issues and anxieties for young people [when it comes to credit cards and debt].” For these consumers, debit payments are much more familiar. Youakim also points out that Sezzle is a cardless option, which also appeals to younger consumers.

Going forward, Youakim hopes to add merchant-backed rewards as well as potentially increasing the cash-back amount as adoption of Sezzle increases. “We are getting more attention from users and merchants,” he said, pointing out that some merchants who are planning to deploy the technology are waiting until after the Christmas season. “We are definitely getting some interest out there from merchants,” Youakim added, “a few ‘not yets,’ but not very many [saying] ‘No.'”

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True Link Financial Lands $3.6 Million Investment

True Link Financial Lands $3.6 Million Investment
By David Penn Posted on
Categories: Funding, Fundings, TrueLink Financial

truelink_homepage_november2016

With an investment of $3.6 million, True Link Financial has more than doubled its total capital, which now stands at more than $7 million in combined equity and debt financing. The company’s latest investment comes courtesy of a quartet of investors: Kapor Capital, Initialized Capital, Symmetrical Ventures, and the Ziegler Link-Age Longevity Fund.

While much of the fintech world remains mesmerized by the millennial market, True Link Financial CEO and co-founder Kai Stinchcombe believes that baby boomers—and increasingly genX-ers—are where it’s at. “We think seniors are the most exciting market in financial services today,” Stinchcombe said. “Half of the wealth in the U.S. is owned by people 59 years and over, and as baby boomers retire, the tidal wave is only growing.”

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Fom left: Kai Stinchcombe, CEO, and Claire McDonnell, COO, demonstrating the True Link Card at FinovateSpring 2014.

True Link Financial said that the funding will help the company’s sales and marketing in support of its key products; namely, the True Link Card and a suite of solutions to help administrators manage trusts and benefit eligibility. The additional capital will also help the company as it launches its new online advisory service, True Link Financial Advisors, which emerged from private beta this week after spending the past year serving “several hundred” of the company’s existing customers.

Founded in 2013 and headquartered in San Francisco, California, True Link Financial demonstrated its True Link Card at FinovateSpring 2014. The company provides a variety of financial planning and management services, specializing in retirees, including both free online portfolio planning and construction as well as fee-based, ongoing advisory services. True Link provides a hybrid investment planning solution, combining online planning technology and customized investment plans with human advisors to give clients the best of both worlds in terms of convenience and support.

“We want our customers to feel confident that investment decisions are always made in their best interest,” the True Link CEO said. Saying that “trust” is often the missing ingredient in the relationships between financial services companies and their customers, Stinchcombe added that True Link advisers do not work on commission and do not sell proprietary products. “Our broad-based approach is delivered for one simple, transparent fee,” he said.

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P2Binvestor Scoops Up More Than $7 Million in New Funding

P2Binvestor Scoops Up More Than $7 Million in New Funding
By David Penn Posted on
Categories: Funding, Fundings, P2BInvestor

p2binvestor_homepage_november2016

Small business marketplace lender P2Binvestor announced $7.7 million in new funding, courtesy of a Series A round led by Rockies Venture Club (RVC). Also participating in the Series A was Japanese venture capital firm, Future Venture Capital Co. (FVC). The investment in P2Binvestor was FVC’s first direct investment outside Japan.

P2Binvestor founder and CEO Krista Morgan said that her company was filling a significant niche for SMEs seeking financing to grow. “We’re seeing more interest in our model as venture funding hits a two-year low and more entrepreneurs are looking for ways to grow their business—while preserving their equity—by using good-quality, flexible debt,” Morgan said. She added that the new capital will be invested in technology as well as sales and marketing “as we scale to meet market demand.”

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P2Binvestor founder and CEO Krista Morgan demoed her company’s technology at FinovateFall 2014.

Headquartered in Denver, Colorado, and founded in 2012, P2Binvestor demonstrated its new borrower app and loan-management dashboard at FinovateFall 2014. The company specializes in providing asset-backed lines of credit, using the crowdlending format to connect both accredited and institutional investors with small businesses needing funding, and using the latest in technology to streamline the underwriting process and provide due diligence for investors. In September, P2Binvestor won the finance and banking PowerBook award from the Denver Business Journal, and extended a $10 million credit facility with Urban Settlement Solutions.

P2Binvestor has funded more than $350 million in revolving credit to more than 80 SME borrowers since the spring of 2014. The company hopes its crowd of 150 accredited retail and institutional investors will help P2Binvestor fund an additional 112 new borrowers by March 2017. P2Binvestor anticipates more than $8 million in revenue this year and expects to be cash-flow positive in 2017. The company’s average line of credit is $1 million.

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Nutmeg Spices Things Up with New $37 Million Investment

Nutmeg Spices Things Up with New $37 Million Investment
By Julie Muhn (@julieschicktanz) Posted on
Categories: Funding, Nutmeg

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U.K.-based robo-advisory pioneer Nutmeg scored $37 million (£30 million) in a Series C funding round this week. Convoy, Hong Kong’s largest firm of independent financial advisers, led the round, while existing investors Schroders, Balderton Capital, Pentech, Armada Investment Group, and Nigel Wray also participated.

The new investment brings the company’s total funding to $75 million and makes it the largest raise for an E.U.-based digital wealth advisor. Also, as Nutmeg said in its press release, “This is also the largest fintech fundraise since the U.K. voted to leave the European Union.”

Nutmeg will use the funds to offer more products and services and to accelerate growth. The company is currently managing $625 million (£500 million) for more than 20,000 clients. Since launching in 2011, Nutmeg has delivered returns between 6.5% and 47% for specific savings goals, ISAs, and pensions.

screen-shot-2016-11-14-at-2-51-18-pmNutmeg’s Nick Hungerford, former CEO, and Jono Hey, head of UX, demoed at FinovateEurope 2012 in London.

Nutmeg debuted its digital wealth-investment technology—before the term robo-advisor had even been coined—at FinovateEurope 2012 in London. In early 2016 the company was recognized on the European Top 100 List at the European Fintech Awards, and the company’s former CEO and founder Nick Hungerford was named one of the U.K.’s coolest people in fintech. In May of 2016, Martin Stead, Nutmeg’s former chief revenue officer, assumed the role of CEO.

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Andreessen Horowitz Leads $25 Million Investment in Quantopian

Andreessen Horowitz Leads $25 Million Investment in Quantopian
By David Penn Posted on
Categories: Funding, Fundings, Quantopian

quantopian_homepage_november2016

With an investment of $25 million led by Andreessen Horowitz, quantitative investment crowdfunding platform Quantopian adds a successful Series C to a year that featured winning the endorsement of billionaire investor, Stephen Cohen. This summer, Cohen invested $250 million in a fund that uses algorithms generated by Quantopian members.

Also participating in Quantopian’s funding round were Bessemer Venture Partners, Point72 Ventures, Khosla Ventures, and Spark Capital—all existing investors. The Series C takes Quantopian’s total capital to nearly $50 million.

“Quantopian has a chance to really disrupt this industry by bringing a distributed-contributor approach to finance, harnessing technology to educate and empower the greatest minds around the world,” says Alex Rampell, Andreessen Horowitz general partner. Rampell, who will join the company’s board of directors, called Quantopian “the next-generation BlackRock”

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Quantopian co-founders, CEO John Fawcett and CTO Jean Breech demonstrated Quantopian Live Trading at FinovateSpring 2013.

Founded in 2011 and headquartered in Boston, Massachusetts, Quantopian demonstrated its technology at FinovateSpring 2013. With more than 300,000 algorithms on its platform, Quantopian gives quantitative-based investment and trading system-developers the capital, data, and R&D environment to build, test, and profit from their trading strategies. The company’s community of developers has more than 90,000 members, and includes everyone from financial professionals and data scientists to students and entrepreneurs.

In addition to funding and investment, Quantopian made 2016 headlines with a set of major C-level hires. In July, the company added Dragan Skoko as its new Head of Trading, and in June, Quantopian brought onboard Jonathan Larkin as chief investment officer and Derek Meisner as general counsel and chief compliance officer.

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$500 Million Raised by 30 Alums in Q3 2016

$500 Million Raised by 30 Alums in Q3 2016
By David Penn Posted on
Categories: Funding, Fundings

moneybag_goldcoinsFinovate/FinDEVr alums raised more than $490 million in the third quarter of 2016, essentially matching the investment haul from the previous quarter. The Q3 performance in 2016 fell short of the eye-popping third quarter from 2015, during which more than one billion was invested in our alums. But 2016’s third quarter still dwarfed previous third quarters in 2014 and 2013 by a large margin.

Previous quarterly comparisons

  • Q3 2016: More than $500 million raised by 29 alums
  • Q3 2015: More than $1 billion raised by 40 alums
  • Q3 2014: More than $194 million raised by 17 alums
  • Q3 2013: More than $171 million raised by 23 alums

The biggest equity deal of the third quarter was the $72 million raised by OurCrowd in September. Also notable were the $50+ million in funding scored by Interactions, Ripple, and Finova Financial. The top 10 overall investments for the third quarter of 2016 totaled $380 million or more than 76% of the quarter’s total alum funding.

Top 10 overall investments (equity only)

  1. OurCrowd: $72 million
  2. Interactions: $56 million
  3. Ripple: $55 million
  4. Finova Financial: 52.5 million
  5. LendUp: $47 million
  6. Behalf: $27 million
  7. Capriza: $23 million
  8. Signifyd: $19 million
  9. Jumio: $15 million
  10. Juvo: $14 million

Here is our detailed alum funding report for Q3 2016.

July 2016: More than $55 million raised by eight alums

August 2016: More than $256 million raised by twelve alums

September 2016: More than $182 million raised by nine alums

If you are a Finovate/FinDEVr alum that raised money in the third quarter of 2016, and do not see your company listed, please drop us a note at research@finovate.com. We would love to share the good news! Funding received prior to becoming an alum not included.

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DemystData Lands New $7 Million Round

DemystData Lands New $7 Million Round
By Julie Muhn (@julieschicktanz) Posted on
Categories: DemystData, Funding

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Data-as-a-service company DemystData this week announced it closed a $7 million Series B round led by MissionOG. Notion Capital and Singtel Innov8 also contributed to the round, which boosted the New York-based company’s total funding to $16 million.

To meet increased demand in the U.S. and Asia, DemystData will use the funds to build its team and expand data partnerships. The company leverages big data pulled from in-house and online sources to help banks make informed decisions, improve the user experience, and decrease risk. DemystData counts as customers some of the world’s largest banks and insurance companies across 10 countries.

“We provide the key to accessing valuable data 10 times faster while adhering to increasing privacy constraints,” CEO Mark Hookey is quoted in a press release. He noted the company helps clients “cut risk by up to 60% and increase acceptance and straight-through processing rates to convert more customers.”

DemystData also this week released the Atlantic Platform, an API that aims to “assess consumer and small-business risk on the back of massive streams of data, text, images, and log files, while improving compliance with emerging privacy law.”

At FinovateAsia 2012, DemystData debuted Credit-in-a-Box, a suite of tools that help banks leverage big data to make better lending decisions. The API aggregates publicly sourced consumer data in real-time to help lenders measure risk and assess customer value. Founded in 2010, the company recently earned a spot in the FinTech20 Hong Kong. In April 2015, DemystData was recognized as a top 100 private company in AlwaysOn’s OnFinance Top 100.

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