Mergers & Acquisitions

Q2 Acquires ClickSWITCH for Digital Account Switching Service

Q2 Acquires ClickSWITCH for Digital Account Switching Service
By Julie Muhn (@julieschicktanz) Posted on
Categories: ClickSWITCH, Mergers & Acquisitions, Q2

Digital banking services company Q2 is getting a boost today. The Texas-based company announced it has acquired Minnesota-based ClickSWITCH.

As part of the agreement, Q2 will integrate ClickSWITCH’s account switching software-as-a-service solution into its product offerings. Terms of the deal were not disclosed.

Founded in 2014, ClickSWITCH offers its 450 financial institution clients an account switching solution for their end customers. The company leverages direct integrations with thousands of employers, payroll providers, and financial institutions to help users switch their direct deposits and automatic payments to new accounts. The client onboarding process, as a result, is simplified significantly.

Q2 anticipates the purchase will help its bank clients attract and retain new primary account holders. “We also believe that with ClickSWITCH we can help our customers provide their account holders with a more streamlined, frictionless experience, by offering an end-to-end digital customer acquisition, onboarding, and account switching solution,” added Q2 CEO Matt Flake.

Q2 will not only benefit from exposure to ClickSWITCH’s client base, but will also offer its existing banking-as-a-service clients more deposits, decreased client acquisition cost, and the potential for growth from an increase in cross-selling.

“As a combined force, we look forward to solving a fundamental issue that banks, credit unions, and fintech companies face – managing the complexity and administrative burden of account switching – by providing the most comprehensive and differentiated digital account switching solution in the market,” said ClickSWITCH Founder and CEO Cale Johnston. “We are delighted to be joining the Q2 team and look forward to delivering best-in-class financial solutions.”

Both Q2 and ClickSWITCH are Finovate alums, having demoed most recently at FinovateWest 2020 and FinovateSpring 2019, respectively.

Photo by Bench Accounting on Unsplash

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Paysafe’s Public Debut on the NYSE

Paysafe’s Public Debut on the NYSE
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Mergers & Acquisitions

Global payments platform Paysafe is making the move to the New York Stock Exchange this week. The London-based company is going public via a merger with Foley Trasimene Acquisition Corp. II, a special purpose acquisition company (SPAC) set up by billionaire business executive Bill Foley.

After the deal, which values Paysafe at around $9 billion, was approved on March 25, Paysafe began trading on the New York Stock Exchange today under the ticker symbols “PSFE” and “PSFE.WS.” The combined company now operates as Paysafe Limited.

“The closing of this transaction and our listing on the New York Stock Exchange is a huge milestone for Paysafe and getting to this point today is testament to the hard work and dedication of our team around the world,” said Paysafe CEO Philip McHugh. “We’re excited to be embarking on the next stage of our growth journey as a public company.”

Founded in 1996, Paysafe enables businesses and consumers to connect and transact using its payment processing, digital wallet, card issuing, and online cash solutions. The company has completed 11 acquisitions, most recently purchasing Openbucks last July.

Paysafe’s suite of brands includes Income Access, Paysafecard, Skrill, and Neteller. In an interview with CNBC, Foley described Paysafe’s solutions as “ubiquitous,” adding, “It’s just everywhere in terms of the gaming world and digital wallets, e-cash solutions.”

With 3,400 employees in more than 12 offices across the globe, Paysafe helps businesses and consumers transact across 70 payment types in 40+ currencies.

Photo by Gemma Evans on Unsplash

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Fiserv Buys Pineapple Payments

Fiserv Buys Pineapple Payments
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Fiserv, Mergers & Acquisitions

Financial services technology provider Fiserv made its latest acquisition this week. The Wisconsin-based company has agreed to purchase payment processing and payment acceptance startup Pineapple Payments.

Financial terms of the deal, which is expected to close next quarter, were not disclosed.

Under the agreement, Fiserv will continue to provide processing services to Pineapple’s 25,000 merchants. Fiserv anticipates the purchase will expand the reach of its own payment solutions, including the CoPilot partner platform, Clover, and Clover Connect.

“With Pineapple Payments already operating as a key distribution partner of Fiserv, we expect to accelerate the delivery of new and innovative capabilities to a host of new merchant clients,” said Fiserv President and CEO Frank Bisignano. “Together, we will provide omni-channel payments technology and services to enable merchants to maximize the potential of electronic payment processing. We look forward to welcoming Pineapple Payments to the Fiserv family and continuing to provide the best-in-class solutions and service that merchants and their customers expect.”

Headquartered in Wisconsin and founded in 2016, Pineapple Payments provides payment processing and omni-channel payment acceptance solutions for integrated software vendors and SMBs.

Today’s deal is Fiserv’s 35th acquisition. Prior to today, the company most recently bought up digital card services platform Ondot in a deal announced last December.

Photo by Any Lane from Pexels

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Pindrop to Buy NextCaller

Pindrop to Buy NextCaller
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Mergers & Acquisitions, Pindrop Security

Phone-based fraud prevention company Pindrop acquired Next Caller this week. Terms of the deal were undisclosed.

Pindrop anticipates the purchase of NextCaller, a call verification and fraud detection solution for contact centers, will position the company for growth, expand its client base, and position it as an industry leader.

“Our two companies will now be able to service the market in its entirety with the right solution for whatever stage of voice security and authentication they are in,” said Next Caller Co-founder and CEO Ian Roncoroni.

The deal comes at a time when demand for call centers is expanding. In a recent report, Forrester found that 42% of brands surveyed saw an increase in year-over-year call center call volume since the pandemic began. Additionally, 65% of companies reported they struggle to manage the high call volume and 80% of firms reported that fraud is a very serious issue in the call center.

Given this, Pindrop CEO Vijay Balasubramaniyan has a positive outlook for the fraud prevention industry. “We couldn’t be more bullish about the future,” he said, “The need for our combined solutions will only continue to grow as brands across multiple industries not only look to better secure their voice channel, but also improve the customer experience. Understanding who you are speaking to is the most effective way to build a better relationship with customers, resulting in a higher NPS and subsequently more profitable exchanges.”

As for what’s next, Next Caller will operate as a wholly-owned subsidiary under Pindrop.

Founded in 2011, Pindrop debuted an IVR solution as well as the availability of its voice authentication technology for use in OTT streaming devices. Headquartered in Alabama, Pindrop is privately held and has raised a total of $213 million from investors including Andreessen Horowitz and Citi Ventures.

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Blend to Acquire Title365 from Mr. Cooper

Blend to Acquire Title365 from Mr. Cooper
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Blend, Daily news, Mergers & Acquisitions, Mr. Cooper

Digital lending platform Blend has agreed to acquire Mr. Cooper-owned Title365 for $422 million.

Blend will leverage Title365 for its title, escrow, and settlement services. Integrating this technology into Blend’s platform will allow the company to automate title commitment upon loan application submission, digitally reconcile settlement fees in real time, and streamline communication among parties. Ultimately, Blend anticipates that Title365’s industry expertise will help minimize costs by integrating title and settlement into the loan process.

Title365 was founded in 2009 and is headquartered in California. The company fits nicely with Blend’s approach of offering a modern experience with its mission “to be the most technologically advanced title insurance and settlement services provider.”

Title365 will be part of Blend’s title marketplace that allows lenders and consumers to choose their preferred title and escrow partner. The tool will be similar to Blend’s insurance marketplace that allows consumers to shop for competitive rates from more than 25 insurance carriers.

“We’re really excited about the agreement to add Title365 to our team as we continue our work to build the full consumer homebuying journey into our platform,” said CEO Nima Ghamsari. “With Title365, we will be able to expand our ability to put lenders at the center of a vastly improved homebuying journey that delivers new levels of efficiency, speed, convenience, and cost savings to everyone.”

Founded in 2012, Blend recently received $300 million in new funding, bringing its total funding to $665 million and boosting its valuation to $3.3 billion. The company facilitated $1.4 trillion in loans last year and counts 285+ lender partners, which together are responsible for around 30% of all mortgage volume in the U.S.

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eToro To Go Public in $10 Billion SPAC

eToro To Go Public in $10 Billion SPAC
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, eToro, Mergers & Acquisitions

Social trading and investment marketplace eToro announced today that it is making the leap to go public. In true 2021 style, however, the Israel-based company isn’t pursuing an IPO. Instead, eToro is merging with FinTech Acquisition Corp. V, a publicly-traded special purpose acquisition company (SPAC), in a deal worth $10 billion.

When the deal is finalized, the combined company will operate as eToro Group Ltd. and is expected to be listed on the NASDAQ.

The move to go public comes after a period of growth for the Israel-based company. Last year, eToro added more than five million new users and brought in $605 million in revenue, 147% higher than the revenue it saw in 2019. Additionally, average monthly registrations have grown from 192,000 in 2019 to 440,000 in 2020. In January 2021 alone, eToro added more than 1.2 million new registered users. Similarly, the number of trades executed on its platform has grown– from eight million average trades per month in 2019, to 27 million in 2020, and 75 million in January 2021 alone.

“We founded eToro with the vision of opening the global market for everyone to trade and invest in a simple and transparent way,” said eToro CEO Yoni Assia. “Today, eToro is the world’s leading social investment network. Our users come to eToro to invest, but also to communicate with each other; to see, follow, and automatically copy successful investors from all around the world. We created a new category of wealth management – social investing – and we are dominating the market as evidenced by our rapid expansion.”

eToro is the seventh fintech to use a SPAC to go public in the past few months, joining SoFi, BankMobile, Payoneer, MoneyLion, Apex, and OppFi.

eToro was founded in 2007 and has offices in Cyprus, the U.K., Australia, and the U.S. The company is among Finovate’s earliest alums, demoing at the very first FinovateEurope conference in 2011.

Photo by Quino Al on Unsplash

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Betterment Acquires Wealthsimple’s U.S. Investment Advisory Business

Betterment Acquires Wealthsimple’s U.S. Investment Advisory Business
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Betterment, Daily news, Mergers & Acquisitions

U.S. wealthtech player Betterment is building up its assets under management. That’s because the company acquired the U.S. investment advisory business of Canada-based Wealthsimple this week.

Terms of the deal– which notably does not include Wealthsimple’s technology, employees, or operations– were not disclosed.

“As we shift our focus to our Canadian business for the time being, finding a partner for our U.S. business that shared our commitment to putting clients first was our top priority,” said Wealthsimple Co-founder and CEO Michael Katchen. “It’s been a privilege to serve our U.S. clients, and we’re confident that their investments will continue to be in good hands with Betterment.”

To find a suitable home for its U.S. accounts, Wealthsimple selected Betterment in a competitive bidding process for its strong reputation and customer-first mentality. Wealthsimple’s U.S. clients will be moved over to Betterment in June of this year.

“This was an excellent opportunity for us to grow our customer base, and we’ll continue to be aggressive in opportunities that accelerate our business goals,” said Betterment’s newly-appointed CEO Sarah Levy.

Photo by Gabby K from Pexels

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Apex Clearing Chooses SPAC to Go Public

Apex Clearing Chooses SPAC to Go Public
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Apex Clearing Corporation, Daily news, Mergers & Acquisitions

Apex Clearing Holdings, a digital clearing and custody engine, announced formal plans to publicly list on the New York Stock Exchange under the ticker “APX.”

The Texas-based company is eschewing the traditional IPO route to a public launch, and instead pursuing the listing via a merger with Northern Star Investment Corporation, a special purpose acquisition company (SPAC). The deal values Apex at $4.7 billion.

Apex is the sixth fintech to use a SPAC to go public in the past few months, joining SoFi, BankMobile, Payoneer, MoneyLion, and OppFi.

“We are in the first inning of the digital revolution in financial services, and our merger with Northern Star will provide Apex with the resources and flexibility to accelerate our growth, scale our platform, and expand our offerings and market share alongside our clients,” said Apex Clearing CEO William Capuzzi.

Capuzzi, along with Apex President Tricia Rothschild, will continue to serve the company in their current roles. Northern Star Chairwoman and CEO Joanna Coles will join the combined company’s Board of Directors.

Apex was founded in 2012 and helps online brokerages, traditional wealth managers, wealthtechs, professional traders, and consumer brands with account opening and funding, execution of trades, digital asset movements, trade settlement, and the safekeeping of customer assets.

Apex has provided custody for $14 billion in new assets year-to-date and currently serves 200+ clients representing more than 13 million customer accounts. The company has already recorded impressive growth so far this year, seeing 3.2 million customer accounts and more than one million new crypto accounts opened in the past two months.

Photo by Arisa Chattasa on Unsplash

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Moody’s to Acquire Cortera

Moody’s to Acquire Cortera
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Cortera, Daily news, Mergers & Acquisitions

Data analytics firm Moody’s announced plans to acquire data insights company Cortera this week. Terms of the deal, which is expected to close in the first quarter of this year, are undisclosed.

Moody’s anticipates the purchase will enhance its risk assessment capabilities. The move will also significantly extend Moody’s coverage in the SME market– the segment that serves as Cortera’s focus.

“Cortera plays an important role in helping businesses understand each other,” said President of Moody’s Analytics Stephen Tulenko. “Our customers will be able to leverage Cortera’s extensive information on small businesses with Moody’s proprietary analytic tools to make better decisions.”

Cortera was founded in 1993 and provides credit data and workflow solutions on North America-based public and private organizations. The Florida-based company maintains a database of credit information on more than 36 million businesses across the continent.

Cortera sources this data from thousands of resources and scrubs it using AI. As a result, the company is able to provide analytics, reports, and monitoring services to help inform businesses’ decisions.

Specifically, the acquisition will augment Moody’s Orbis database of private company information and enhance its KYC, commercial lending, and supply chain solutions.

Moody’s was founded in 1900 and provides data, analytical solutions, and insights to help businesses identify opportunities and manage risk. The company employs more than 11,000 people across 40+ countries. Headquartered in New York City, Moody’s is publicly traded on the NYSE under the ticker MCO. The company has a market capitalization of $52 billion.

Photo by Hunter Harritt on Unsplash

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NCR Acquires Terafina to Expand Digital Banking Platform

NCR Acquires Terafina to Expand Digital Banking Platform
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Mergers & Acquisitions, NCR Corporation

Two weeks after announcing its purchase of Cardtronics, fintech hardware giant NCR is acquiring Terafina, a company known for its digital account opening and onboarding tools.

Financial terms of the agreement were not disclosed.

NCR will tap Terafina’s expertise to expand NCR’s sales and marketing capabilities in its Digital First Banking Platform. The offering, which can be tailored to fit institutions ranging in size from large banks to community banks and credit unions, provides an API-led approach to digital banking that can be hosted or deployed on-premise to help banks lower costs and speed up their innovation cycle.

Last year increased the urgency for financial services companies of all kinds to improve their digital customer experiences. Founded in 2014, Terafina suits this need. The company offers a software-as-a-service solution that offers digital onboarding tools and helps banks and credit unions synchronize their branch, call center, and digital operations to provide a consistent user experience across channels.

At FinovateSpring 2019, Terafina Founder and CEO Meheriar Hasan showcased the company’s digital sales platform that helps banks address the needs of their small business clients.

“Digital Banking is a key aspect of the NCR-as-a-Service strategy we laid out at Investor Day in December,” said NCR CEO Michael D. Hayford. “Terafina has been a partner of ours and is already up and running, integrated with our Digital Banking platform. We know this adds value for our clients by making digital account sales, marketing and onboarding easier, so they can provide a superior experience for customers.”

Today’s deal marks NCR’s 29th acquisition since it was founded in 1884. NCR’s purchase of Terafina fits with the company’s strategy to purchase early stage companies to boost its product capabilities and enhance its leadership.

NCR is headquartered in Atlanta, Georgia, and counts 36,000 employees across the globe. The company is listed on the New York Stock Exchange under the ticker NCR and has a market capitalization of $4.81 billion.


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Payoneer To Go Public Via SPAC, Now Valued at $3.3 Billion

Payoneer To Go Public Via SPAC, Now Valued at $3.3 Billion
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Mergers & Acquisitions, Payoneer, SPAC

Cross-border payments expert Payoneer is the latest fintech to go public via SPAC merger. The New York-based company has agreed to merge with FTAC Olympus Acquisition Corp.

The transaction is expected to close during the first half of this year.

Once the reorganization is complete, the newly created holding company will be renamed Payoneer Global Inc. and the combined company will operate as Payoneer, a U.S. publicly listed entity. After the deal is finalized, Payoneer will have an estimated value of $3.3 billion.

Payoneer was founded in 2005 and offers multi-currency accounts to marketplaces, sellers, freelancers, gig workers, manufacturers, banks, suppliers, and buyers. With a mission to “democratize access to financial services and drive growth for digital businesses of all sizes from around the world,” Payoneer helps users pay and get paid globally as easily as they do locally.

“Payoneer is at the forefront of the rapid, global shift to digital commerce across all sectors,” said Betsy Z. Cohen, Chairman of the Board of Directors of FTAC Olympus Acquisition Corp. “Its innovative and unique high-tech, high-touch platform positions Payoneer at the epicenter of some of the most powerful and enduring trends driving global commerce today. Its proven ability to facilitate the overall growth of e-commerce through capabilities such as B2B payment digitization, global risk and compliance infrastructure, and the enablement for SMBs to rapidly grow and scale sets Payoneer apart.”

Payoneer has raised $270 million from 18 investors including CBC Capital and 83North. Scott Galit is CEO.

Today’s news of Payoneer opting to go public via a SPAC merger echoes a larger trend. Lately, we’ve seen a rising number of tech companies, including Bank Mobile and SoFi, use SPAC mergers to go public. Benefits of the IPO alternative include a faster and cheaper process, no qualification threshold, and no IPO window.

Photo by NastyaSensei from Pexels

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January’s M&A Fintech Landscape

January’s M&A Fintech Landscape
By Julie Muhn (@julieschicktanz) Posted on
Categories: Mergers & Acquisitions

When analysts predicted what would happen in the fintech sector after the pandemic hit last year, one of the top forecasts was that the industry would consolidate. That is, companies that had an adaptable business model and were fierce enough to fight would get bigger, while other companies would seek exits or sometimes fold altogether.

The economic crunch from the pandemic isn’t the only thing boosting M&A activity. We’ve seen a rising popularity of using a special purpose acquisition company (SPAC) instead of an IPO to go public. With these two forces boosting deal flow, we saw seven mergers and acquisitions announced last month:

This is quite a boost compared to last January when we saw only four M&A deals. In the next couple of months before the summer slowdown occurs, we can expect to see more M&A deals in the headlines. Keep an eye out specifically for two types of deals. First, SPACs are becoming a more legitimate option for a company to make a public debut. Second, digital bank acquisitions will increase as last year’s explosion of players in the digital banking space begins to deflate to a more sustainable level.

I would be remiss if I didn’t mention Visa’s attempted acquisition of Plaid. Visa formally announced its intentions to take over Plaid for $5.3 billion. The acquisition fell through, however, after the U.S. Department of Justice filed a civil antitrust lawsuit to block the deal.

Photo by Sora Shimazaki from Pexels

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