Funding

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

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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

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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

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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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Nanopay Raises $10 Million Series A

Nanopay Raises $10 Million Series A
By David Penn Posted on
Categories: Funding, Fundings, nanoPay

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With support from Goldman Sachs, Canadian payments innovator nanoPay has raised $10 million in new funding. The Series A also featured the participation of APAGM Services, Jarnac Capital Management, and Rohatton. nanoPay said the investment will help it develop business partnerships in advance of a larger rollout of its MintChip digital currency technology. The funding will also help nanoPay build additional complimentary services for both the B2B and B2C markets.

nanoPay CEO Laurence Cooke elaborated on this point, saying that in the wake of MintChip’s successful deployment in Canada this summer “our focus is now on expanding the platform beyond digital cash to a broad range of B2B uses-cases that have global applications.” Cooke referred to both B2C disbursements and cross-border payments as examples.

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Laurence Cooke, nanoPay founder and CEO, demonstrated MintChip at FinovateFall 2016 in New York.

Developed by the Royal Canadian Mint and purchased by nanoPay in 2015, MintChip is a cloud-based currency that can be used to securely store and transfer digital value instantly, without third-party intervention. The technology provides for final, irrevocable transactions in real-time that are cryptographically secured. For consumers, MintChip provides a faster checkout process that combines both loyalty programs and payments, and works online as well as in-person. With its open API platform, MintChip has potential applications beyond commerce, including in telecommunications, central bank operations, and for acquirers.

Founded in 2011 and headquartered in Toronto, Ontario, Canada, nanoPay demonstrated MintChip at FinovateFall 2016. Earlier this month, the company announced that Liberty Village would serve as a “working lab” for its digital currency. In July, nanoPay added Tracy Molino as general counsel and chief compliance officer and, in June, the company partnered with Ingenico Group to enable merchants to accept MintChip via their Ingenico Group smart terminals.

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Lendio Closes $20 Million Funding Round

Lendio Closes $20 Million Funding Round
By Julie Muhn (@julieschicktanz) Posted on
Categories: Funding, Lendio

lendio_homepage_october2016

Small-business loan-marketplace Lendio today reeled in $20 million in Series D funding. Leading the round were Comcast Ventures and Stereo Capital. Existing investors Napier Park, Blumberg Capital, Tribeca Venture Partners and North Hill Ventures also contributed, bringing Lendio’s total funding to $31 million.

The Utah-based company will use the funds to boost Lendio’s growth via marketing, sales, and brand awareness, which should augment its YOY growth, which already sits at 100%. Other growth figures include:

  • In Q3, Lendio funded $63+ million in loans, up 14% from Q2 2016
  • In Q3, Lendio funded more than 2,900 businesses, up 22% from Q2 2016
  • Lendio saw a record number of repeat customers in Q3, up 33% over Q2 2016

Regarding the company’s growth, Lendio founder and CEO Brock Blake said, “Even though we’ve helped facilitate funding for more than 13,000 small business owners, we’re just scratching the surface as to the number of business owners that we can help; our goal is to help fuel the American Dream for the millions of SMBs that make up the backbone of our U.S. economy.”

Lendio seeks to decrease the time it takes for small businesses to secure loans. The company works on behalf of small business borrowers to match them with the right loan, helping the 75 lenders on its platform reach qualified borrowers. Lendio partnered with American Express in April to power its merchant-financing offering. In 2015, the company facilitated $128+ million in financing to more than 5,100 businesses. Lendio debuted at FinovateSpring 2011.

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PaySimple Pulls in $115 Million

PaySimple Pulls in $115 Million
By Julie Muhn (@julieschicktanz) Posted on
Categories: Funding, PaySimple

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Colorado-based service commerce solution PaySimple just closed its second round of funding since its founding in 2006. The $115 million round amounts to 7X more than the first round the company closed in 2011. PaySimple’s funding now totals $131 million.

The company anticipates the investment from Providence Strategic Growth will fuel efforts to market services online, automate payment acceptance, and deliver the solution to its customers. Mark Hastings, managing director and head of Providence Strategic Growth, will join PaySimple’s board of directors.

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At FinovateFall 2012, PaySimple CEO Eric Remer (pictured right) demonstrated how the company uses early payment incentives to help small businesses get paid faster. Earlier this month, PaySimple began focusing on helping service-based businesses improve the customer experience by offering tools such as online appointment scheduling, payment and registration forms, and an online store, as well as a variety of ways to collect payment, such as in-person, online, over the phone, via invoice, and by recurring billing. Remer said, “The service-business model is centered around customers.” He added, “Business owners have to build trust and create lasting and ongoing relationships with people. Our service-commerce platform connects business owners and their staff to the people they do business with, instead of just the transactions or products sold.”

The company serves 17,000 clients in a range of industries, from fitness to professional services. In May, PaySimple partnered with small business loan marketplace Fundera to offer its clients a new way to procure working capital via the Fundera-empowered Loan Center.

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SecureKey Raises $20 Million in New Funding

SecureKey Raises $20 Million in New Funding
By David Penn Posted on
Categories: Funding, Fundings, SecureKey

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Q. If you are Toronto-based identity and authentication specialist, SecureKey Technologies, what’s a nine-letter word for Canadian FIs commited to improving online security?

A. Investors.

SecureKey announced this week that it picked up $20.6 million ($27 million CAD) in new capital from BMO Bank of Montreal, Bank of Nova Scotia, CIBC, Desjardins, Royal Bank of Canada, and TD. The investment brings SecureKey’s total funding to $89 million and serves as growth capital to support the introduction of SecureKey’s digital identity network.

Greg Wolfond, SecureKey founder and chairman, said the support from “Canada’s largest financial institutions” would help his firm “develop and deliver a national ecosystem that puts consumers first.” Rizwan Khalfan, EVP and chief digital officer for TD, echoed this point and credited SecureKey for leading the way in making it easier for customers to manage their digital assets, as well as for the company’s willingness to work with and receive “substantial input from TD and other banks.” Khalfan added that TD was “uniquely positioned to help shape [SecureKey’s] offering” due to TD’s commitment to security and privacy.

Along with its collaborators, SecureKey anticipates launching its digital identity network in 2017. And with Wolfhound’s return as CEO, the company plans to further drive development of its SecureKey Concierge service, as well. “We want to help put the consumer back in the middle and let them take control of their digital assets, to share what they want, with whom they want, and always with informed consent,” Wolfond said.

Founded in 2008, SecureKey last demoed its technology at FinovateFall 2012. A Best of Show winner from its demo at FinovateFall 2010, SecureKey announced in September that CBIC had joined its authentication service, SecureKey Concierge. In 2015, SecureKey was named to KPMG and H2 Ventures’ Fintech 100.

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Financeit’s Fresh $17 Million to Fund TD Financing Acquisition

Financeit’s Fresh $17 Million to Fund TD Financing Acquisition
By Julie Muhn (@julieschicktanz) Posted on
Categories: FinanceIt, Funding

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Today, Financeit pulled in a $17 million venture funding round that was led by new investors Pritzker family business interests advised by The Pritzker Organization and DNS Capital. Existing investors also contributed. The new installment boosts the Canada-based company’s total funding to more than $38 million since it was established in 2011.

This comes less than a month after Financeit announced the acquisition of TD Bank Group’s indirect home improvement financing assets. Today’s installment will be used to fund the $339 million transaction, which included the purchase of more than 800 merchant dealer agreements. Once things have settled from the deal, Financeit will be servicing 45,000 existing TD consumer loans.

The secondary purpose of today’s round will be to “support the ongoing needs of the company as it continues its rapid growth.” In a press release, Michael Garrity, founder and CEO of Financeit, said, “As more merchants embrace the benefits of offering cloud and mobile-based financing options to their customers, Financeit expects to increase its sizable signature in this market. We continue to focus on innovation for our merchant partners and market growth through both organic tactics and acquisition.” The company has already increased its lending activity in the home improvement industry by almost 2X since 2015.

Last month, Financeit made headlines when it recruited Ian Hanning, the CFO from Capital One Canada. Earlier this fall the company debuted its direct-to-consumer financing platform, Financeit Direct, which enables consumers to apply for funds via their mobile device. At FinovateFall 2014, Financeit made its U.S. debut in conjunction with FIS.

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