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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Rocket Companies, the parent company of tech-driven real estate, mortgage, and financial services businesses, acquired personal finance app TrueBill today. The deal is expected to close by the end of the year for $1.28 billion in cash.
“We are very impressed with what Truebill has created – providing a simple, intuitive client experience to help its users save significant money,” said Rocket Companies CEO Jay Farner. “The company is a perfect fit for the Rocket platform. Truebill’s work helping Americans keep track of their finances and providing guidance that leads to better financial outcomes follows the same philosophy as Rocket Companies – leveraging the power of technology to remove the friction from complex transactions – and applies it to everyday life.”
Founded in 2015, TrueBill helps its 2.5 million members manage subscriptions, improve credit scores, track spending and renegotiate bills. The company analyzes $50 billion in transactions each month and has saved consumers a total of $100 million.
For Rocket Companies, the purchase will push the subsidiaries toward their goal of creating a centralized destination for consumers to manage their entire financial lives. Rocket Companies will also benefit from Truebill’s recurring revenue, which is on track to generate $100 million each year. This figure is more than double the annual revenue the company generated in 2020.
As for its own operations, Rocket Companies generates $1.3 billion each year from the monthly payments made by the organization’s 2.5 million clients for mortgage servicing.
Narrative Science reported on Wednesday that its acquisition by Salesforce – and integration into Saleforce’s Tableau team is complete. First announced last month, the closing of the acquisition this week will combine Narrative Science’s automated data storytelling capabilities with Tableau’s analytics platform.
“Bringing the Narrative Science award-winning, world-leading AI in analytics team and their innovations to Tableau will help us reach millions more people who are underserved with data,” Tableau President and CEO Mark Nelson wrote on the company’s blog this week. “It will help close the data literacy gap, reimagine an entirely new analytics experience, and set people up for success in this digital-first world.”
Salesforce acquired Tableau Software in 2019 in a deal that combined “the world’s #1 CRM with the world’s #1 analytics platform” Tableau announced in a press release that August. The goal of the acquisition was to enable Salesforce customers to “unlock even greater value from their data” using Tableau’s combination of diverse visualization, analytics, and AI. By adding Narrative Science’s data storytelling technology, Tableau and Narrative Science move closer to their shared goal of “making data more available to everyone, everywhere.”
A Finovate alum since 2013, Narrative Science is a leading provider of automated business analytics and natural language communication technology. Founded in 2010 and headquartered in Chicago, Illinois, the company is an innovator in the field of data storytelling. As a strategy for delivering business intelligence, data storytelling transcends both data visualization and static dashboards by translating insights into easy-to-understand stories and giving business users a personalized data digest. The company’s Lexio solution, its latest iteration unveiled in the fall of 2020, serves both businesspeople who require data insights in order to do their jobs, but do not have the time or skills to become data analysts, as well as leaders of analytics teams who need to ensure that insights are accessible to and understandable by employees who can translate them into action.
“Unlike today’s typical BI tools, Lexio anticipates what employees need to know so they can make faster and better data-driven decisions,” Narrative Science co-founder and CEO Stuart Frankel said. “Data without context is useless, and Lexio brings that context and understanding to every single employee in plain language and in a consumer-like experience.”
As of this fall, Narrative Science has raised nearly $43 million in funding from investors including Jump Capital, Sapphire, and Battery Ventures. In October, the company earned a #1 ranking in Crain’s Chicago Business Most Innovative Companies 2021 roster. Over the summer, Narrative Science’s Lexio won the “AI-Based Analytics Innovation Award” at the AI Breakthrough Awards.
Cryptocurrency exchange platform Coinbaseacquired Israel-based security company Unbound Security today. Terms of the deal, which Coinbase calls the next phase of its security journey, were not disclosed. Coinbase expects the deal to close in the coming months.
Unbound specializes in cryptographic security technologies, including secure multi-party computation (MPC), an emerging subfield of cryptography that allows parties to jointly compute a function over their inputs while protecting their data. Essentially, MPC enables crypto assets to be stored, transferred, and deployed more securely, easily and flexibly.
Today’s deal will give Coinbase access to cryptographic security experts, including Unbound Co-founders Guy Peer and Yehuda Lindell, who is considered a world leader in MPC. Coinbase will also gain a presence in Israel and plans to establish a tech center in the country. The company states that this global reach will “add an additional powerful prong” to its global talent acquisition strategy.
“We’ve long recognized Israel as a hot bed of strong technology and cryptography talent, and are excited to continue to grow our team with some of the best and brightest minds in these fields,” the company said in its blog post announcement. “The Unbound Security team will form the nucleus of this new research facility, which we plan to grow over time.”
The purchase of Unbound marks Coinbase’s twentieth acquisition since the company was founded in 2012. Coinbase has acquired six companies this year alone, including financial software company BRD, voice AI startup Agra, crypto wallet API provider Zabo, financial infrastructure company Skew, and blockchain security firm Bison Trails.
Coinbase, which demoed at FinovateSpring 2014, went public earlier this year and now trades on the NASDAQ under the ticker COIN. The company has a current market capitalization of $67 billion. Earlier this fall the company announced plans to launch its own NFT marketplace, Coinbase NFT, to help users mint, purchase, showcase, and discover NFTs.
Ohio-based KeyBank made its sixth acquisition today. The bank purchased Banking-as-a-Service company XUP, a platform that helps banks take control of the merchant experience. Terms of the deal were not disclosed.
Founded in 2018, XUP connects merchants, third party financial service providers, and acquirers across channels to help banks offer a more integrated and seamless payments experience. KeyBank will use XUP’s technology to improve its embedded banking strategy and improve the user experience for its commercial users. The bank describes the move as the “next step in providing digital innovation at scale.”
Today’s news is only the latest development in the relationship between KeyBank and XUP. The bank contributed to XUP’s $3 million Seed round closed in February and the two were strategic partners. According to KeyBank, XUP helped accelerate the volume growth of its merchant payments capabilities. The bank now counts 150 million card transactions each year, accounting for $13.6 billion in annual card volume.
“We’ve long embraced the software innovation that’s sweeping through the financial services industry, and the acquisition of XUP allows us to continue to be a leader in this space,” said KeyBank’s Head of Enterprise Payments & Analytics Ken Gavrity. “XUP’s highly experienced team has accelerated us on the journey to build connectivity across our systems, our partners, and our customers, to make it easy to do business with Key.”
XUP will continue to operate as its own entity and support its customer base. “Our end-to-end software solutions, combined with Key’s scale and deep financial services expertise, will perfectly blend to provide clients a best-in-class payment experience,” said XUP President Chris May.
KeyBank was founded in 1825, has $187 billion in assets under management, is headquartered in Cleveland, Ohio, and has 1,000 branches across the U.S. The bank’s other acquisitions include AQN Strategies, Finovate alum HelloWallet, First Niagara Financial Group, EverTrust Financial Group, and Leasetec. Among the company’s strategic partners are AvidXchange, BillTrust, and Bill.com.
U.S. Bank has agreed to acquire San Francisco, California-based expense and travel management company TravelBank. Financial terms of the transaction were not disclosed, but one outlet, Skift, has said that the deal was valued at $200 million.
“We are focused on giving businesses more confidence, control, and convenience in managing payments and expenses,” U.S. Bank Vice Chair of Payment Services Shailesh Kotwal said. “TravelBank will help us accelerate these efforts.”
Founded in 2016, TravelBank offers an all-in-one solution for expense and travel management. Relying on a single platform, reporting model, and subscription price, TravelBank helps employees and businesses control and track expenses, automate traditionally manual processes, streamline both approvals and reporting, and remain compliant. With more than 20,000 customers, TravelBank claims to have reduced business travel spending by its clients by 30% on average, while simultaneously boosting employee morale with a user-friendly design and a travel rewards program. Ahead of this week’s acquisition, the company had raised $35 million in funding from investors including Dreamers VC and DCM Ventures.
“We created TravelBank to provide a single experience for expense reporting and travel management,” co-founder and CEO of TravelBank Duke Chung explained. “Our combined offering with U.S. Bank will be the most comprehensive expense, travel, and payment management solution in the industry.”
Skift further reported that Chung will “move over to the bank” post-acquisition, while TravelBank will continue to support its existing clients.
The acquisition is the fruit of a partnership between the two companies that extends back to September of 2020. In the fall of last year, U.S. Bank integrated TravelBank’s travel and expense management platform into its U.S. Bank Instant Card. The collaboration enabled program administrators to issue Instant Cards directly from their expense management platforms.
With nearly 70,000 employees and $567 billon in assets, U.S. Bancorp is the parent company of U.S. Bank National Association. Headquartered in Minneapolis, the bank serves millions of customers, both in the U.S. and around the world, with a variety of services including consumer and business banking, payments, corporate and commercial banking, wealth management, and investments.
U.S. Bank demonstrated its Card-as-a-Service (CaaS) solution at FinovateFall 2021 in September. The technology enables companies to leverage API integration to extend corporate credit digitally and create a custom virtual payment experience in their ecosystem.
MoneyLion made a move today that will help it catch the eye of prospective customers and retain its existing ones. The digital bank acquired MALKA, a creator network and content platform, to help it better engage with consumers and connect with communities.
MALKA was founded in 2012 and works with creators to develop content across digital mediums including advertising campaigns, original branded content, e-gaming livestreams, podcast series, feature length documentaries, sports representation, and marketing. One of MALKA’s differentiating factors is that it maintains a talent base of 170 employees in-house in order to maintain relationships instead of working with different freelancers on different projects.
MALKA will help MoneyLion, which already offers MoneyLife content, in its mission to become a daily destination by bringing evergreen content to educate, inform, and support customers’ financial decisions. Ultimately, integrating MALKA’s content into MoneyLion will support the digital bank’s marketing and brand-building efforts.
“Through this acquisition, which we anticipate will be accretive and cash flow positive in 2022,” said MoneyLion Co-Founder and CEO Dee Choubey, “we will now be able to fully leverage MALKA’s capabilities so that the MoneyLion brand can truly live wherever our customers are investing their attention.” CMO Bill Davaris added, “This fundamental shift will allow us to own and not rent the relationships we are cultivating with new and existing MoneyLion customers.”
At face value, a tie-up between a digital bank and a content creation company seems a bit odd. The acquisition, however, can be seen as MoneyLion simply buying its own creative marketing and content department. No matter how you look at it, the acquisition is a hat tip to the new creator economy and speaks to how content-driven today’s consumers are.
MALKA will operate independently from MoneyLion and the company’s Founder and CEO Louis Krubich and Co-Founder and President Jeff Frommer will continue to lead daily operations. “This partnership will allow us to exponentially grow our creator network and engage with millions of more fans,” said Krubich.
MoneyLion launched in 2013 and offers a full-service platform that delivers mobile banking, lending, and investment solutions. Earlier this year the company teamed up with Zero Hash to launch the ability for users to buy, sell, and hold cryptocurrencies. The company went public on the New York Stock Exchange in September via a SPAC merger with Fusion Acquisition Corporation.
BM Technologies (formerly known as Bank Mobile) has agreed to merge with Seattle-based community lender First Sound Bank for $23 million. The combined entity will be called BMTX Bank and will serve customers across the country digitally while maintaining a community banking division that will continue serving customers in the greater Seattle market.
“This is a thrilling milestone for BM Technologies and is a major step forward in executing our vision to create a disruptive FinTech bank that combines the best of financial technology with a strong and compliant FDIC-insured institution,” BM Technologies, Chair, Founder, and CEO Luvleen Sidhu said.
BMTX will pay up to $7.22 in cash for each share of First Sound Bank common stock, which amounts to approximately $23 million. Subject to regulatory approvals and customary closing conditions, the strategic merger is slated to close in the second half of 2022. The deal is expected to add significantly to the combined company’s revenue, EBITDA, and earnings trajectory over the next one to three years. Sidhu said that the strategic merger will enable BMTX Bank to offer a variety of new services including direct to consumer and small business operations, marketplace lending, robo-advisory, and blockchain-based payment systems.
“As one of the largest digital banking platforms in the country with approximately 2 million accounts, this merger allows BMTX to lead a new wave of financial innovation by enhancing its focus on technology, inclusion, easy-to-use products, and customer education with the mission of creating ‘customers for life,'” Sidhu explained.
Sidhu will serve as Chair and CEO of BMTX Bank, and will be directly responsible for digital banking initiatives. First Sound Bank President and CEO Marty Steele will serve as COO of BMTX Bank and will lead the company’s community banking division.
“As a local bank, we remain committed to our community and are excited about the opportunity to leverage BMTX’s innovative digital banking technology, Banking-as-a-Service business model, low-cost deposit funding, and better access to the capital markets in order to scale our SBA, commercial and private banking, mortgage, and other business lines,” Steele said.
Founded in 2004 with the largest initial capital base of any de novo bank in the Pacific Northwest at the time, First Sound Bank provides commercial banking services for SMEs, not-for-profit organizations, entrepreneurs, and professional service firms in the Puget Sound region. Headquartered in Seattle, Washington, First Sound Bank has approximately $150 million in assets.
Formerly known as Bank Mobile, BM Technologies was launched in 2015 with a goal of providing a simple, affordable, and financially empowering, digital-first banking experience. The company went public via SPAC at the beginning of the year, listing on the New York Stock Exchange under the ticker BMTX. BM Technologies currently has a market capitalization of $145 million.
The company’s strategic merger announcement comes on the heels of BM Technologies’ Q3 results. Among the quarter’s highlights, BM Technologies reported that serviced deposits topped $2 billion for the first time. The company also earned recognition in the 2021 Finovate Awards in September, winning Best Fintech Partnership courtesy of its collaboration with T-Mobile.
To learn more about BM Technologies, check out our Fireside Chat with Luvleen Sidhu from FinovateFall 2021 in New York.
Announced earlier this year, the merger between cross-border payments marketplace CurrencyFair and payment workflow automation platform Assembly Payments has secured regulatory approval. The merged company has also rebranded as Zai as part of a new focus on providing a wider set of integrated financial services to mid-market businesses and enterprise-level customers within and beyond the Australian market. The CurrencyFair brand will remain intact to serve consumers and small businesses with the kind of fast, affordable foreign exchange the company has offered for nearly a decade.
Paul Byrne, who served as CEO and President of Currencyfair for more than five years, will now serve as CEO and President of the new entity Zai. “Our vision with Zai is to boldly transform the future of financial services,” Byrne said in a statement. “The Australian market is very close to our hearts – both Assembly Payments and CurrencyFair were founded by Australian innovators.”
To underscore this point Byrne added that Zai was first to market with NPP, Australia’s New Payments Platform, and that the company planned to launch its new, real-time digital payments solution, PayTo, in the middle of next year. PayTo will enable merchants and businesses to initiate real-time payments from their customers’ bank accounts.
“Zai will continue our tradition of being customer-centric, solving problems and adding value around our five core capabilities,” Byrne said. These areas – payments, global payment accounts, partner ecosystem, lending and settlement, and services – represent major growth opportunities according to Byrne, in what he described as a “$2 trillion revenue market for payments.” In addition to expanding its presence in Australia, Zai plans to launch in the U.K., the U.S., and Asia in 2022 and to grow its workforce from 170 to 450 by 2025.
“We are already seeing the benefits of expansion as we forecast a second successive year of 60% growth in processing volume to $6.5 billion in 2021,” Byrne said.
Headquartered in Dublin, Ireland and launched in 2009, CurrencyFair has been a Finovate alum since 2012. Ahead of the merger with Assembly Payments, the company had securely exchanged the equivalent of €10 billion, enabling its customers to send money to more than 150 countries. The company had raised more than $24 million in funding before acquiring Assembly Payments, picking up an additional $35 million in funding from Standard Chartered afterward.
“By bringing together the complementary strengths of CurrencyFair and Assembly, we are supporting the merged company in offering the full range of payment services,” Standard Chartered group chief executive Bill Winters said earlier this year, “providing retail and corporate clients access to fast, high-volume domestic and cross-border payments.”
Does COVID have you dreaming up your long-awaited vacation? Consumer payment services firm Klarna’s latest acquisition may be of help.
The Sweden-based company snapped up Inspirock, an online trip planning service, for an undisclosed amount. Klarna CEO and Co-Founder Sebastian Siemiatkowski described the addition of travel planning “a natural extension of the benefits Klarna brings to payments and shopping.”
Founded in 2012, Inspirock leverages AI to help its customers explore a destination’s offerings and create personalized itineraries utilizing local expertise. On an annual basis, the California-based company sees 25+ million customers each year.
The integration will allow Klarna’s 90 million customers to use the Klarna app to pay for a trip in installments. In addition to the payment aspect, Klarna will also help users plan for their trip. Inspirock matches travelers’ preferences with over 230 million data points to optimize their travel itinerary and discover hidden gems.
“For customers, this makes the whole journey from inspiration to planning and preparing for a trip simpler, less stressful, and more fun, while enabling our retail partners to better reach and engage with their audiences by offering more personalized content,” said Siemiatkowski.
Combining travel planning with its existing payment capabilities inches Klarna towards becoming more like a super app. Founded in 2005 and with $3.7 billion in funding, Klarna offers buy now, pay later options to help users avoid credit cards while enjoying payment flexibility. Klarna also offers a shopping app to provide users with a holistic shopping experience– from payments to shipment tracking– and a rewards club it describes as the “vibeyest community in shopping.”
Just days after relaunching its online store and appointing a new CEO for its European operations, point of sale (POS) technology provider SumUpannounced the acquisition of customer loyalty startup Fivestars for $317 million. The purchase marks SumUp’s sixth overall acquisition but its first in the U.S.
“Our global community of merchants has battled through lockdowns and volatility and we’re confident that this acquisition will further energize the U.S.’s recovering small business economy,” said SumUp Co-founder Marc-Alexander Christ. “Now is the time to make sure our presence is as strong in the U.S. as it is in Europe and, by acquiring Fivestars, SumUp will deliver for U.S.-based merchants as it has in other international markets.”
SumUp launched in 2011 and now helps three million merchants across the globe get paid. The company offers card reader, QR code and POS payment technologies, along with management and reporting tools and invoicing capabilities. Lacking in this product lineup, however, are loyalty and rewards offerings. This is where the integration of Fivestars’ technology comes in. Providing small business clients a way to reward their customers and build loyalty will help SumUp compete with other POS technology providers such as Square, Shopify, PayPal and Zettle.
Founded in 2010, Fivestars helps businesses set up a digital rewards program that gives customers points and gifts for their purchases. The technology automatically sends campaigns to welcome new customers, celebrate their birthdays, and bring back customers who haven’t visited recently. Fivestars also offers enterprise loyalty programs for larger franchises; clients include brands such as Play it Again Sports, Super Cuts, and Orange Leaf.
The acquisition will also help SumUp launch operations in a new geographical market. The U.K.-based company will now have access to Fivestars’ 70 million consumer members and 12,000 small businesses; a network which drives $3 billion in sales and 100 million transactions each year. Fivestars’ San-Francisco-based team, along with its CEO, Victor Ho, will remain in their roles and continue to operate Fivestars.
SumUp raised $869 million (€750 million) earlier this year, bringing its total funding to $1.4 billion. The company supports over three million merchant users in 34 markets.
Accounts receivable automation firm Billtrust made its first acquisition since going public via a SPAC merger a year ago. The New Jersey-based company purchased collections management company iController for $58 million.
Belgium-based iController was founded in 2017 and offers a SaaS product that provides credit and collections professionals visibility into cash flow management. Billtrust will acquire the iController team, along with the company’s 566 Europe-based clients. iController employees will continue working in the company’s offices in Belgium The Netherlands.
“Acquiring a great company like iController is consistent with our growth plan of strategic global expansion in targeted ways to broaden our customer footprint and provide extended value to our current customers,” added Billtrust Founder and CEO Flint Lane.
Billtrust was founded in 2001 and today’s deal marks the company’s eighth acquisition.
Billtrust offers a wide variety of products, including credit, ecommerce, invoicing, payments, managed services, training, and more. The company also offers a collections tool, which will be enhanced with iController’s collections product. Billtrust President Steve Pinado described iController as “a strong strategic fit,” saying that the company will help Billtrust not only expand its physical presence in the European market but also enhance its collections capabilities.
In 2013, Billtrust launched its Business Payments Network, a service that connects suppliers to accounts payable automation platforms buyers are using to pay, as well as to a network of third-party banks and ERPs. Earlier this year, the company updated the platform to now support bi-directional exchange of transactional data and documents. The new release now enables invoice presentment to accounts payable portals.
U.K. bank NatWestacquired children’s allowance-tracking app RoosterMoney this week. Financial terms of the deal are undisclosed.
NatWest plans to integrate RoosterMoney’s Star Chart, Virtual Money Tracker, and Chore Manager into its own offerings in order to provide tools for families and children to learn to manage their allowance money and other funds.
“We want NatWest to be the easiest and most useful bank for families and young people,” said Head of Youth, Retail Banking at NatWest Group Simon Watson. “We know that the world of money is changing, and we want to help parents, carers, and young people feel confident and capable – Rooster helps us do just that.”
Rooster was founded in 2016 and helps its 130,000 U.K. users to learn the basics about money– earning, spending, saving, and giving. In addition to a digital chore chart, RoosterMoney offers a debit card that pairs with the app to offer parental control such as turning the card on and off, blocking certain merchants, and real-time spending notifications.
“At RoosterMoney we believe that if you build financial capability early on, you’re better prepared to take on the challenges that life throws at you,” said RoosterMoney CEO Will Carmichael. “That’s totally aligned with the bank’s purpose and we’re very excited about working together to help more parents and kids to build their financial confidence.”
NatWet said that it will allow RoosterMoney’s existing customers to continue to use the app as usual.
This isn’t NatWest’s first entrance into the youth banking products market. The bank has offered its MoneySense financial education program, that targets kids ages five to 18, for 25 years. Additionally, NatWest recently launched HouseMate, a bill-splitting app for renters, and Island Saver, a game to help young customers learn about money management.
