Mergers & Acquisitions

DoubleNet Pay Acquired by Benefits Provider Purchasing Power

DoubleNet Pay Acquired by Benefits Provider Purchasing Power
By Julie Muhn (@julieschicktanz) Posted on
Categories: DoubleNet Pay, Mergers & Acquisitions

Financial wellness platform DoubleNet Pay announced this week it has agreed to be acquired by Purchasing Power, an Atlanta-based voluntary benefit provider for employers. The financial terms of the deal, which closed on September 28, were not disclosed.

DoubleNet Pay was founded in 2013 on the principle of paying yourself first. The company’s platform helped users account for bills and savings goals before using their income on discretionary spending. Every time its users received a paycheck, DoubleNet Pay automatically separated the funds into three different accounts– savings, bills, and spending– to help users achieve financial freedom.

Purchasing Power, however, was most interested in DoubleNet Pay’s Workplace offering, a feature for businesses to help their employees gain financial security. As Richard Carrano, Purchasing Power CEO, explained, “This investment enables us to take a significant next step in our mission to provide expanded financial wellness products and services that will fill gaps not addressed by traditional employee benefit providers.” Purchasing Power will rebrand the service to fit into its existing offerings.

“We are excited that the DoubleNet Pay platform will be able to help Purchasing Power’s millions of eligible employees set proactive short-term savings goals and take care of monthly bill obligations automatically,” said Brian Cosgray, founder and CEO of DoubleNet Pay. “We have known the Purchasing Power leadership team for many years and are impressed with its passion for helping to improve the financial well-being of their customers.”

At FinovateSpring 2015, DoubleNetPay showed off how it takes the stress out of personal financial management. Last year, the Georgia-based company partnered with T. Rowe Price to integrate its online cash flow management tool into T. Rowe Price’s Retire With Confidence Program. Before its exit, the company had raised $4 million from Fuqua Investments and TTV Capital.

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Cryptocurrency Firm Circle to Acquire SeedInvest

Cryptocurrency Firm Circle to Acquire SeedInvest
By David Penn Posted on
Categories: Mergers & Acquisitions, SeedInvest

Goldman Sachs-backed cryptocurrency start-up Circle will acquire SeedInvest, an equity crowdfunding platform and broker-dealer, reports Antony Peyton of Fintech Futures (Finovate’s sister publication).

The firm said this acquisition will accelerate its plans for a token marketplace that enables businesses and individuals to raise capital and interact with investors using open crypto rails and infrastructure.

This acquisition and planned new offerings are subject to the U.S. Financial Industry Regulatory Authority (FINRA) approval. Financial details have not been disclosed.

Headquartered in New York City, SeedInvest has the “largest” equity crowdfunding platform in the country. To date, SeedInvest has helped hundreds of start-ups raise capital online and has a network of over 200,000 investors.

In addition, the company has generated triple-digit annual revenue growth while reaching profitability.

Circle said the SeedInvest product includes capabilities needed for executing regulated crowdfunding, such as start-up due diligence, securities issuance, investor accreditation, payments, and securities custody.

With the merger and approval from regulators, these capabilities will be expanded to support crypto-denominated investments including using fiat stablecoins such as USDC, as well as issuing and offering tokenised securities.

SeedInvest will add 30 team members to Circle’s New York location.

Founded in 2012 by Ryan Feit and James Han, SeedInvest demonstrated its equity-based, crowdfunding platform at FinovateSpring 2013. During the demo, Feit and Han highlighted a number of key features of the platform, including its due diligence dashboard, virtual boardroom, and its Simple Invest technology which provides an instant identity check, legal document execution, and streamlined funds transfer.

Prior to the company’s acquisition, SeedInvest had raised $11.4 million in capital. Avenue A Ventures, Great Oaks Venture Capital, Scout Ventures, and Jumpstart New Jersey Angel Network are among the firm’s previous investors.

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Infosys to Acquire Fluido for $76 Million

Infosys to Acquire Fluido for $76 Million
By Julie Muhn (@julieschicktanz) Posted on
Categories: Infosys, Mergers & Acquisitions

International technology firm Infosys announced this week it has acquired cloud advisory and consulting services company Fluido for $76 million. This marks Infosys’ second acquisition this year, following its purchase of WONGDOODY in April.

Fluido’s excels as one of the largest and oldest platinum consulting partners for Salesforce in Europe and is also an authorized Salesforce training delivery partner in the Nordic region. India-based Infosys anticipates the buy will boost its reputation as a Salesforce enterprise cloud services provider.

Infosys will benefit from more than just Fluido’s Salesforce expertise, however. The company will also receive more recognition across the Nordic region, given Fluido’s offices in Finland, Denmark, Sweden, Norway, and Slovakia, as well as tap into Fluido’s established client base across the region.

In the press release Ravi Kumar, president and deputy COO at Infosys, said, “Fluido will be an important addition to the Infosys family, bringing a unique combination of market presence, deep salesforce expertise, agile delivery, and training, that combined with our existing capabilities will help companies reimagine and transform their businesses. This acquisition also aligns to our efforts to invest in local capabilities in the regions in which we operate.”

Fluido’s clients will also benefit from the deal. As the company’s founder and CEO, Kai Mäkelä explained, “With Infosys we will now be able to provide truly global scalable services while maintaining the close relationship with our customers. With digital experience playing a key role in customer success, we are excited to have the opportunity to work with Infosys to help Fluido customers change the way they connect with their customers.”

The acquisition is expected to close in the third quarter of 2019.

Finacle, part of EdgeVerve Systems, a subsidiary of Infosys, showcased EdgeVerve Blockchain Framework for Financial Services at FinovateEurope 2017. At the start of 2018 Infosys teamed up with Tradeshift to help clients digitize supply chain management. Last month, the Australian Military Bank became the first bank in Australia to go live with Infosys’ Finacle solution.

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Chain Rebrands to Interstellar Following Acquisition

Chain Rebrands to Interstellar Following Acquisition
By Julie Muhn (@julieschicktanz) Posted on
Categories: Chain.com, Mergers & Acquisitions

Earlier this year, we reported that cryptographic ledger company Chain was in talks to be acquired by blockchain technology platform Stellar. Today, Chain announced that the deal has been finalized, and that it is retiring the Chain brand and rebranding to Interstellar.

Interstellar brings Chain together with Lightyear, which Stellar launched in 2017 to design and develop the Stellar protocol and create an open source reference for the Stellar network. Interstellar leverages Lightyear’s functionality and blends it with Chain’s enterprise products and customer base. Combined the two companies offer a platform that makes it easier for large enterprises to build on Stellar.

Adam Ludwin, who has served as CEO of Chain since the company’s launch in 2014, will transition to the role of Interstellar CEO. “Chain has admired Stellar for years, and from day one we’ve shared their goal of enabling financial assets to move seamlessly over the internet,” said Ludwin. “Chain has worked from inside the enterprise while Stellar has focused on the network between organizations. As a single team we will have a complete view and set of capabilities to make value-over-IP a reality.”

Chain’s product offerings will become part of Interstellar’s product portfolio. The portfolio will also include StellarX, a marketplace where users can trade assets on Stellar.

Interstellar will be headquartered in San Francisco with offices in New York and San Francisco. The new organization will employ 60 people. Jed McCaleb, founder of Stellar, will serve as Interstellar CTO.

Ludwin showcased at FinDEVr San Francisco 2015, where he gave a presentation titled, The Blockchain Is Eating Financial Services. Earlier this year, Forbes listed Chain on its Fintech 50 roster that highlights the top private fintechs that have operations, customers, or impact in the U.S. Before its acquisition, Chain had raised more than $43 million from notable investors including Khosla Ventures, RRE Ventures, Nasdaq, Visa, Citi Ventures, and Thrive Capital.

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Shoeboxed Acquired by Earth Class Mail

Shoeboxed Acquired by Earth Class Mail
By Julie Muhn (@julieschicktanz) Posted on
Categories: Mergers & Acquisitions, Shoeboxed

Receipt and business card digitization company Shoeboxed unboxed some major news today. The North Carolina-based company sold to Earth Class Mail, after having raised $2.5 million since it was founded in 2007. The terms of the deal were not disclosed.

Founded in 2004, Earth Class Mail offers a postal mail scanning and forwarding service to help businesses and frequent travelers clear paper clutter. The Texas-based company receives, processes, and digitizes clients’ paper mail. It then enables users to view, access, search, and share the cloud-hosted, digitized versions. After processing the paper copies, Earth Class Mail either stores physical copies on premise or shreds the paper, if the client prefers. Additionally, Earth Class Mail leverages integrations with third parties to automate actions required. For example, if the piece of mail is an invoice, it will send it to Bill.com or sync it to cloud storage. The company will even deposit a check on the user’s behalf.

https://www.youtube.com/watch?time_continue=38&v=ASi6EAJNzi0

With the acquisition of Shoeboxed, Earth Class Mail will help users get rid of another source of pesky paper– receipts.  Another benefit Earth Class Mail gains with the acquisition are Shoeboxed one million customers in 90 countries, half of which are small businesses in the U.S.

In an interview with TechCrunch, Shoeboxed CEO and co-founder Tobias Walter said, “The combined power of our two companies will be a massive shift for small businesses to finally become paperless and say goodbye to old workflows that cost them hours of their productivity. I could not be happier with the new home we found for the company, the team and our customers!”

At FinovateSpring 2015, Shoeboxed won Best of Show for demonstrating how banks can leverage the company’s receipt capture platform. In the demo, Walter showcased how banks can use Shoeboxed to help clients view line item data from email receipts, receive reminders about product return deadlines, product recall information, and more. Last August, the company launched Fetch, an “expense-report-free” expense reporting solution for small businesses.

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Credit Karma Buys Mortgage Platform Company

Credit Karma Buys Mortgage Platform Company
By Julie Muhn (@julieschicktanz) Posted on
Categories: Credit Karma, Mergers & Acquisitions

Consumer credit monitoring and financial health company Credit Karma is furthering its reach into the real estate sector this week with the acquisition of mortgagetech startup Approved.

In a blog post yesterday, Approved Founder and CEO Andy Taylor announced that Credit Karma had acquired the three-year-old startup for an undisclosed amount. “Working with Credit Karma gives us the resources and immediate scale to accelerate our mission-driven work, reaching significantly more homebuyers than we could have imagined when we started,” Taylor said.

Credit Karma, which previously offered a basic mortgage comparison tool, is bolstering its capabilities with Approved at a time when many Millennials are beginning to purchase their own homes. As the company’s Chief Product Officer Nikhyl Singhal explained in an interview with TechCrunch, “As we’ve expanded, you’ve seen us move from credit cards as a way to help members with that part of their life to first personal loans to auto — meaning auto loans, auto insurance,” he said. “Today, we’re really talking more publicly about mortgage. Mortgage being for many of our members the most important financial decision they’ll make.”

Having facilitated almost $5 billion in loan originations, Approved was launched in 2015 by Taylor and co-founder Navtej Sadhal. The two met while working at RedFin, where they realized a need for disruption in the back-end of the mortgage process, where inefficiencies such as fax machines are still prevalent. Taylor vowed to stay true to Approve’s humble roots, adding, “We can’t wait to reveal what we’re working on next.”

Credit Karma already hosts many financial tools such as credit monitoring, tax filing, and credit card comparisons. By adding a more robust mortgage platform to this list, the company is creating a more sticky ecosystem with which to hook its 80 million users, half of which are Millennials.

At FinovateSpring 2009, Credit Karma CEO Ken Lin demonstrated the company’s platform, which offers free credit reports from Equifax and TransUnion, and seeks to serve as a hub for users to monitor their financial health. The company has facilitated the origination of more than $40 billion in credit products since it was founded in 2007. Earlier this year, the company teamed up with SpyCloud to help users determine if their data is being used on the dark web. Check out our recent interview with Colleen McCreary, Credit Karma’s first Chief People Officer.

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Xero Buys Paperless Accounting Firm Hubdoc

Xero Buys Paperless Accounting Firm Hubdoc
By Julie Muhn (@julieschicktanz) Posted on
Categories: Mergers & Acquisitions, Xero

Cloud accounting platform Xero claimed today that “business has never been so beautiful.” That’s because the New Zealand-based company made its second acquisition, purchasing Hubdoc, an application that helps accountants and bookkeepers capture and maintain documents online.

Xero, which has always sought to improve the lives of accountants and bookkeepers, said the purchase helps them “focus their efforts on making sense of a small business’ financial data – not collecting it.” Hubdoc will help Xero bolster its machine learning models, serve customers who have no direct data connection, and increase its presence in Canada via Hubdoc’s Toronto roots.

Here’s how the integration of the two technologies works: first, Hubdoc automatically gathers financial documents from 700+ billers, extracts the financial data, and syncs the data into Xero. Then, Xero automatically matches data imported from Hubdoc with bank feed transactions to keep clients’ books up-to-date. All of this data is verified with the source document, which clients and accountants can easily search.

The Hubdoc team, which is located in offices across Australia, the U.K., and Canada, will work independently on a standalone basis until Xero forms an integration plan. The terms of the acquisition were undisclosed.

Xero most recently presented at FinDEVr San Francisco 2014 when the company’s Head of U.S. Partnerships David Pollock spoke about building an API-driven ecosystem for small businesses. At FinovateSpring 2011, CEO Rod Drury debuted the company’s Business Identification solution. Last month, Xero signed a strategic alliance with fellow Finovate alum Gusto, allowing Xero to provide full-service payroll in the U.S. And earlier this spring, Xero launched Connected Accounting, a set of new features designed to automate daily business tasks.

Founded in 2006, Xero listed on the New Zealand Stock Exchange in 2007 and the Australian Securities Exchange in 2012. The company has raised more than $319 million (NZ$470 million) in funding, including $1.4 million pre-IPO; $10.2 million at its IPO; and follow-on rounds from investors including Peter Thiel, Matrix Capital Management, and Accel Partners. More than 1 million subscribers in 180+ countries use Xero.

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Entrust Datacard Acquires SMS Passcode

Entrust Datacard Acquires SMS Passcode
By Julie Muhn (@julieschicktanz) Posted on
Categories: Entrust Datacard, Mergers & Acquisitions

Identity authentication and secure card issuance company Entrust Datacard announced it purchased SMS Passcode from CensorNet, a cloud security company. Additionally, Entrust Datacard made a strategic investment of an undisclosed amount in CensorNet. Terms of both the investment and the acquisition remain undisclosed.

With the acquisition of Copenhagen-based SMS Passcode, an adaptive multi-factor authentication technology solution, Entrust Datacard hopes to further establish itself in the authentication space while expanding its global footprint throughout DACH/Benelux and The Nordics. The company will integrate the new technology with its IntelliTrust SaaS authentication tool, a solution launched last year that removes friction for users and provides strong protection for data, apps, and networks.

Regarding the purchase, Ed Macnair, CensorNet CEO said, “The acquisition of SMS Passcode will benefit the broader IAM market as well as SMS Passcode customers, and this new relationship will continue serving customers as Entrust Datacard builds upon existing partnerships and enhances our USS offering.”

Collaborating with CensorNet on its USS platform, which offers a cloud access security broker, multi-factor authentication, and web and email security, will help Entrust Datacard bolster new offerings across authentication, PKI and SSL. Specifically, Entrust Datacard will leverage the strategic partnership to enhance its Authentication Insight Engine by providing faster authentication decisioning.

“Identity-centric data analysis is in CensorNet’s DNA, and identity assurance capabilities in ours,” said Todd Wilkinson, president and CEO for Entrust Datacard. “This new relationship and investment in CensorNet presents opportunities for collaboration to enhance both companies’ offerings and re-shape the market together.”

Entrust Datacard was founded in 1969 and presented at FinDEVr Silicon Valley 2016. Jason Soroko, Security Technologies Manager, and Matt Rose, Technical Sales Consultant, spoke to the audience of developers on Safeguarding Your Banking Applications. Earlier this week, Entrust Datacard unveiled TruCredential 7.5, software that enables tablet and mobile-based capture and issuance of ID cards.

With 2,200 employees in 34 locations across the globe, Entrust Datacard is a privately held company headquartered in Shakopee, Minnesota. The company issues 10 million+ identity and payment credentials daily and manages billions of transactions on an annual basis.

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Five Degrees Acquires Icelandic IT Software Company Libra

Five Degrees Acquires Icelandic IT Software Company Libra
By Julie Muhn (@julieschicktanz) Posted on
Categories: Five Degrees, Mergers & Acquisitions

Banking technology company Five Degrees is expanding its geographic footprint today with the acquisition of Iceland-based Libra, a core banking technology firm.

The purchase is expected to boost Amsterdam-based Five Degrees’ global footprint and will bring additional expertise in securities and loans to Five Degrees’ clients, ultimately offering a more robust digital transformation experience. The integration of Libra into Five Degrees helps the company offer banks a more efficient, less expensive way to replace their outdated core system.

Martijn Hohmann, CEO of Five Degrees, described Libra as “a very strong player” in Iceland’s financial market. He added that the integration of the two companies will help banks “transfer smoothly to ‘digital’ and to benefit from increased flexibility and reduced costs.”

Libra’s 40 employees will work alongside and collaborate with the Five Degrees workforce. The company’s CEO, Thordur Gislason, said that the acquisition enables the company to support clients with new technology, products and services. “Besides,” he added, “it creates opportunities to utilize our knowledge and experience in a larger market. We believe that our future plans have a great fit with the vision and strategy of Five Degrees.”

Founded in 2009, Five Degrees has raised a total of $11.6 million. At FinovateEurope earlier this year, the company showcased Prospery, its digital wealth management solution. Among Five Degrees’ partners are KPMG, Lexis Nexis, and Microsoft. Earlier this year, the company collaborated with BillPro to launch a cross-border banking service.

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Zooz Acquired by PayU in Deal Valued at More than $80 Million

Zooz Acquired by PayU in Deal Valued at More than $80 Million
By David Penn Posted on
Categories: Mergers & Acquisitions, Zooz

In an extended post at the Zooz blog, company CEO Oren Levy announced that the eight-year old global payments platform he co-founded had agreed to be acquired by PayU. Financial terms were not disclosed, but Reuters reported that the deal was valued between $80 million and $100 million.

“Although it wasn’t entirely out of the blue, I can honestly say that PayU is a natural buyer for Zooz,” Levy wrote. “It simply makes sense.” He explained that given the options of continuing to raise capital and remain independent or seek the opportunity to grow “under the umbrella of PayU. The choice was clear.”

PayU will use Zooz’s technology to provide more payment options for its merchants, and help the company expand into cross border payments markets in developing, high-growth areas. This includes building a payment infrastructure with fraud management and smart routing. With a strong presence in India, Netherlands-based PayU currently has operations in 17 markets around the world.

The acquisition of Zooz also represents a win for the company’s open platform approach that gives merchants the ability to connect with a variety of payment providers. “In the choice between building a closed walled garden and an open platform, we decided to go with the second model,” PayU CEO Laurent le Moal told The Indian Wire. “The reality is that you need to be neutral and work with everyone.”

Levy and Zooz CTO Ronen Morecki will join PayU’s leadership team. The company’s 70 employees will also become a part of PayU.

“While Zooz will continue to innovate and further disrupt the payments world,” Levy wrote,” the scale that will be introduced through the sheer number of merchants using the PayU payment solution, coupled with the huge trove of data that can accelerate our analytics and machine learning capabilities, make this an exciting opportunity that we’re eager to explore.”

Zooz demonstrated its Transforming Checkout solution at FinovateFall 2013. Based in Raanana, Israel, Zooz announced a partnership with PayU last year that combined its cross border payment expertise with PayU’s presence in emerging markets. This spring, the company launched its open-payments-platform-as-a-service solution, PaymentsOS.

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FundAmerica Acquired by Prime Trust

FundAmerica Acquired by Prime Trust
By David Penn Posted on
Categories: FundAmerica, Mergers & Acquisitions

From “key vendor” to acquirer, Prime Trust has just purchased crowdfunding regtech specialist FundAmerica. Terms of the deal were not disclosed.

In an email, FundAmerica CEO Scott Purcell emphasized the deep relationship between the two companies (Purcell is CEO of both firms and is Chief Trust Officer of Prime Trust). He wrote “Prime Trust (is) developing a massive amount of proprietary software on top of FundAmerica’s code-base, so the acquisition is symbiotic for everyone involved.”

FundAmerica builds SEC-compliant solutions for technology-based securities offerings. The company’s platform provides AML screening and bad actor checks, payment acceptance solutions for both fiat and cryptocurrencies, online investing, escrow management, and broker-dealer compliance and syndication tools. To date, FundAmerica has raised more than $750 million from 150,000 investors in more than 1,000 offerings.

Prime Trust is a blockchain-driven trust company that sees itself disrupting the traditional trust industry in the same way PayPal disrupted merchant processing. The firm serves as a custodian and trustee for personal and corporate trusts, as well as for crowdfunding platforms. It holds cash and non-cash assets including stocks, bonds, and cryptocurrencies.

Combining the two companies provides capital markets participants with a one-stop-shop in terms of both regulatory and custodial services. And Purcell pledged that there would be no disruption for clients and partners of FundAmerica or Prime Trust. “The APIs, the technology, and the services all continue without interruption,” Purcell wrote. “They will just get better and better.”

He added, “The important thing is that Prime Trust and FundAmerica are now unified and even better positioned to deliver best-in-class technology, compliance, trust, and custodial services to everyone involved in online capital markets; including ICOs and SCOs.”

Based in Las Vegas, Nevada, FundAmerica demonstrated its API for crowdfunding platform compliance at FinovateSpring 2015. Previous to its acquisition, the company had raised $2.3 million in funding.

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Equifax Acquires DataX to Promote Financial Inclusion

Equifax Acquires DataX to Promote Financial Inclusion
By Julie Muhn (@julieschicktanz) Posted on
Categories: Equifax, Mergers & Acquisitions

Consumer insights and credit scoring company Equifax made its 18th acquisition this week. The Georgia-based firm purchased credit reporting agency and alternative data provider DataX.

The move is expected to promote financial inclusion for underbanked consumers by helping lenders expand access to credit. DataX’s alternative data stores complement Equifax’s core credit database, as well as specific services such as The Work Number, Equifax’s centralized repository of payroll data. Equifax will also benefit from DataX’s analytics and identity solutions, as well as credit reporting, ID verification, bank account verification, and custom risk services.

“Giving consumers fair access to credit has always been a key economic driver for upward mobility, and this acquisition will help more consumers gain access to credit and capital,” said Trey Loughran, president of United States Information Solutions at Equifax. “The combination of DataX’s data with Equifax’s unique and robust data assets will add more depth to consumer’s profiles and will help lenders expand borrowing options.”

As a part of the transition, the DataX brand and its 18 employees have been integrated into Equifax’s Banking and Lending Division. Other recent acquisitions in Equifax’s portfolio include ID Watchdog and Veda Advantage.

At FinovateFall 2011, Equifax showcased the benefits of the Equifax Complete features of its mobile app. Last week, the company teamed up with Thinking Capital to launch BillMarket, a solution that helps small businesses in Canada extend payment terms and increase their purchasing power. Earlier this year, Equifax appointed a new CTO, launched NeuroDecision technology for neural network modeling, and unveiled Lock & Alert, a service that helps consumers quickly lock and unlock their Equifax credit report.

Founded in 1899, Equifax is publicly traded on the NYSE under the ticker EFX. The company’s market cap sits at $15.2 billion.

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