Mergers & Acquisitions

Nexmo Acquired by Vonage for $230 Million

Nexmo Acquired by Vonage for $230 Million
By Julie Muhn (@julieschicktanz) Posted on
Categories: Mergers & Acquisitions, Nexmo

NexmoHomepage

Cloud communications startup Nexmo is now Nexmo, a Vonage company, after being acquired by communications giant Vonage for $230 million.

The company’s CEO Tony Jamous is now president of the newly acquired entity. CTO Eric Nadalin and Nexmo’s 170-person team are also moving over to Vonage.

Nexmo brings 350 enterprise customers from across the globe, which marks Vonage’s first expansion outside of the United States.

Vonage CEO Alan Masarek comments on the acquisition, “By combining Vonage’s rapidly growing, unified communications-as-a-service business with Nexmo, we are creating the future of cloud communications. These companies represent a set of strategic, technology and human resources assets that deliver the broadest services offering in our industry.”

Nexmo demoed its Verify SDK at FinovateEurope 2016 and presented on using the crowd to decrease fraud at FinDEVr New York 2016.

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SumUp Announces Merger with Payleven

SumUp Announces Merger with Payleven
By David Penn Posted on
Categories: Mergers & Acquisitions, SumUp

SumUp_homepage_April2016

The merger between mPOS innovators SumUp and payleven announced this week will create a new giant in the industry that processes more than €1 billion a year in 15 countries.

Founder and CEO of SumUp Daniel Klein called the deal a “game-changer for the mobile payments industry” and a major move toward his vision of building the “first ever global card acceptance brand.” payleven co-founder Konstantin Wolff referred to SumUP and payleven as “two complimentary teams sharing the same vision” and said the merger would produce a company that is “larger and more powerful than the sum of its parts.” The combined entity will operate as SumUp.

SumUp_stage_FEU2013c

Pictured (left to right): Stefan Jeschonnek, CMO and co-founder, and Florian Richter, country manager, U.K., demonstrated SumUp at FinovateEurope 2013 in London.

SumUp’s proprietary end-to-end EMV technology, hardware terminal, and mobile apps enable merchants to accept both credit and debit card transactions with a smartphone or tablet. Certification with Europay, MasterCard, and Visa ensures a high level of payment security and has enabled the company to serve merchants in 15 countries such as Brazil, Sweden and, as of last October, the U.S. SumUp’s investors include American Express, BBVA Ventures, Groupon, Venture Incubator AG—all participants of the company’s most recent fundraising last August. Founded in August 2011 and headquartered in Dublin, Ireland, SumUp demonstrated its technology at FinovateEurope 2013.

payleven’s Bluetooth-powered card readers help SMEs process credit and debit card payments. Founded in 2012, the Berlin-based company raised more than $25 million in funding, including a $10 million Series D round in February.

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TIO Networks Closes Purchase of Softgate Systems

TIO Networks Closes Purchase of Softgate Systems
By Julie Muhn (@julieschicktanz) Posted on
Categories: Mergers & Acquisitions, TIO Networks

TIOHomepage

Cloud-based bill payment processor TIO Networks today announced it closed on the acquisition of Softgate Systems. The acquisition of the New Jersey-based bill payment services provider makes TIO the largest walk-in bill payment network in North America.

In a press release, TIO CEO Hamed Shahbazi says the deal “provides a unique opportunity for TIO to scale its business substantially and represents an important corporate milestone as we continue to grow and evolve to meet the needs of our customers.” He continues, “TIO has enjoyed an eight-year relationship with Softgate. …We expect to be able to expand and extend services towards our customer base across North America, with a strong focus on servicing the underbanked and unbanked population.”

Along with the news, TIO cited recent metrics about the combined companies:

  • The two generated 12-month historical revenues of more than $83 million (CAD$105 million)
  • In the last year, the two processed  about 80 million consumer transactions worth over $9 billion
  • The addition of Softgate adds $5 million in incremental EBITDA per year (providing TIO with $30 million in net operating losses)
  • TIO’s geographical footprint has expanded from 15 U.S. states to 46 states.

The financial terms of the deal, for which TIO secured a $5.7 million loan, were divided into three aspects:

  1. $4.6 million in cash
  2. 25 million TIO Network shares issued to Softgate shareholders
  3. $4 million issuance in vendor take-back promissory notes

TIO was founded in 1997 under the name Infotouch Technologies. At FinovateSpring 2012, the company launched TIO Mobile Pay, a mobile app that empowers consumers by allowing them to pay telecom, utility, financial services, and insurance bills using their Visa or MasterCard credit cards, or their debit card. Since then, the Vancouver, B.C.-based company garnered $1.7 million through the issuance of a secondary stock offering, and was awarded second place in the top-10 companies on the 2016 TSX Venture 50. It was also named one of Canada’s 20 hottest and most innovative public tech companies.

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Ally Financial Acquires TradeKing for $275 Million

Ally Financial Acquires TradeKing for $275 Million
By Julie Muhn (@julieschicktanz) Posted on
Categories: Mergers & Acquisitions, TradeKing

TradeKingHomepage

TradeKing, an online brokerage firm that prides itself on straightforward, low pricing, has been acquired by Detroit-based Ally Financial (NYSE: ALLY), a publicly traded financial services company primarily known for auto-lending. The purchase price paid in cash is $275 million.

Ally is purchasing the Florida-based company for its online broker/dealer, digital portfolio-management platform; educational content; and social collaboration channels. According the the Wall Street Journal, the acquisition will serve as a stepping stone to help Ally expand its services into wealth management, mortgages, and credit cards. Ally CEO Jeffrey Brown says, “The addition of wealth management is the next key step in Ally’s digital product evolution and will create a powerful combination of segment-leading direct banking and innovative investment services in a single integrated customer experience.”

The deal is expected to close in Q3 of this year. Once it does, TradeKing’s 180 employees will join Ally Financial. TradeKing, with $4.5 billion in assets under management, will operate under the branding of Ally Financial.

In the early days of Finovate, TradeKing presented the TradeKing Community at FinovateSpring 2008. TradeKing Community is one of the first brokerages to create a social network that enables investors to share their online trades with others.

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BBVA Acquires Holvi for Undisclosed Sum

BBVA Acquires Holvi for Undisclosed Sum
By David Penn Posted on
Categories: Holvi, Mergers & Acquisitions

Holvi_homepage_Mar2016

Described by Wired magazine as one of the “hottest startups in Finland,” Holvi has just been acquired by Spanish bank BBVA, a fellow Finovate alum.

“We’re excited about Holvi as we share a vision about the benefit of technology for the customer,” BBVA’s Teppo Paavola said. Paavola, chief development officer and GM of new digital business for BBVA, also praised the way Holvi leveraged technology “to bring a new approach to small business banking, where services essential to a business’s future, such as invoicing, are built into their core offer.”

Holvi_stage_FEU2013

Pictured: Holvi co-founder Tuomas Toivonen demonstrating his company’s platform at FinovateEurope 2013 in London.

“We found the ideal owner in BBVA,” Holvi CEO Johan Lorenzen added in a statement on the Holvi blog. “A bank with the understanding of the digital world to give us the necessary room to grow, and then the scale and expertise to underpin that growth with sound foundations.”

Terms of the acquisition were not immediately available.

Calling itself “Banking for Makers and Doers,” Holvi provides SMEs, freelancers, and entrepreneurs with a business current account that features its own international bank account number (IBAN), as well as a suite of banking, accounting, and invoicing tools to make it easier to manage company finances. Holvi accounts provide automatic financial statements, including a real-time update of VAT balance, and can be used to send invoices and even set up an online store. As of April 2016, Holvi customers in Germany, Austria, and Finland will also get access to a Holvi Business MasterCard.

Last December, Holvi was featured in TheNextWeb’s look at “10 Finnish startups to watch in 2016.” That same month, Let’s Talk Payments included Holvi in a roundup of top Nordic fintech startups. Business Insider also recognized the company last fall, naming it among the “12 hottest” fintech startups in the region. And in September, Holvi launched its Supercharge feature to make it easier for customers to add money to their Holvi accounts.

Founded in 2011 and headquartered in Helsinki, Finland, Holvi demoed its technology at FinovateEurope 2013. The company is an authorized payment institution licensed and regulated by FIN-FSA (the Financial Supervisory Authority of Finland.)

 

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United Capital Acquires FlexScore

United Capital Acquires FlexScore
By Julie Muhn (@julieschicktanz) Posted on
Categories: FlexScore, Mergers & Acquisitions

FlexScoreHomepage

FlexScore, a platform that gamifies financial planning, was purchased by California-based advisory firm United Capital this week. Terms of the deal were not disclosed.

United Capital, which holds $15 billion in assets under management, plans to use FlexScore as a tool to help its advisers engage clients.

The FlexScore platform assesses and scores the user’s financial health and assigns action steps (as seen below) to improve their score. The goal is to reach a top score of 1000, which signifies financial independence.

flexscoremystepsUnited Capital CEO Joe Duran commented to Investment News that FlexScore fits the “missing piece” from the company’s digital suite for clients and advisers. Additionally, Duran stated, “The right intersection is not technology alone, or people alone, but when you have an interactive engaging experience that is powered by people.”

In the future, Duran plans to implement the scoring tool within retirement plans to stimulate engagement. The company is in talks with potential partners for this use case.

United Capital began its relationship with FlexScore in 2014 when it purchased FlexScore’s parent company, Valley Wealth, in a deal that excluded FlexScore.

FlexScore co-founders Jason Gordo and Jeff Burrow launched the startup at FinovateSpring 2013. Since then the San Francisco-based company has raised $4.7 million and created a mobile version of the app (launched at FinovateFall 2014 in New York).

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BluePay Acquires Billhighway

BluePay Acquires Billhighway
By David Penn Posted on
Categories: Billhighway, Mergers & Acquisitions

Billhighway_homepage_Feb2016

Billhighway, developer of cloud-based financial management solutions for non-profit and member-based organizations, has been acquired by card processor and gateway provider, BluePay.

John Rante, BluePay CEO, highlighted Billhighway’s “innovative technology, a strong annual growth rate, and incredible customer satisfaction.” Rante said Billhighway’s nonprofit vertical was a “great fit” for BluePay and sees the acquisition as an opportunity to grow BluePay’s integrated merchant base.

Billhighway Chairman and Founder Vince Thomas added that the merger will help “improve the level of products and services” the company provides its member-based association and not-for-profit clients.

Terms of the acquisition were not disclosed.

The announcement comes less than a month after Billhighway was again recognized as one of the “Best and Brightest” companies to work for. Billhighway offers a range of products, from its enterprise-grade financial management platform to its prepaid card (which won the “Head of the Class” PayBefore Award in 2014), to the mobile-fundraising solution the company demoed at FinovateFall 2012.

Last fall, Billhighway earned a spot on Deloittes 2015 Technology Fast 500 for North America for the third year in a row. That summer, the company adopted the SnapApp platform to enable development and publishing of interactive content. In March, Billhighway picked up a Silver Stevie Award for Innovation in Customer Service in the Financial Services Industry category, its second win at the Stevies since 2013.

Founded in 1999, Billhighway is headquartered in Troy, Michigan.

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Wipro Inks Agreement to Acquire Viteos Group

Wipro Inks Agreement to Acquire Viteos Group
By David Penn Posted on
Categories: Mergers & Acquisitions, wipro

Wipro_homepage_Dec2015

In a bid to grow its fund accounting and business process services and capabilities, Bangalore-based IT consultancy Wipro has agreed to acquire Viteos Group. The Times of India reports a purchase price of $130 million.

Viteos Group provides a proprietary platform built for cross-border, any asset class, any currency, post-trade operations for the U.S. alternative investment-management industry. The company has offices in New York, New Jersey, London, and the Cayman Islands.

Nagendra Bandaru, SVP and head of business process services for Wipro, says Viteos “brings with it experienced leadership, domain expertise, and unique BPaaS capability.” Speaking for Viteos, company founder and CEO Shankar Iyer referred to the acquisition as the “culmination” of his company’s “search for a global partner.”

Wipro_stage_FEU2015

From left: Wipro General Manager Mukund Kalmanker, Wipro general manager, and Sudhakar Babu Tamminedi, Wipro practice head, demonstrated ngGenie myAdvisor at FinovateEurope 2015 in London.

Terms of the acquisition were not immediately available, and the deal is still subject to regulatory review. The acquisition is scheduled to be complete by the end of March 2016.

The deal combines Viteos Group’s buy-side expertise with Wipro’s sell-side credentials in areas such as reconciliation, settlements, and KYC, among others. President of Wipro, CEO Shaji Farooq explained that the trend of IT services moving toward the “as-a-service” model made a deal like this one with Viteos a priority. “Our strategy is to invest in industry vertical platforms which will provide platform-based services to our clients in a transaction/outcome-based pricing model,” Farooq explained. “Viteos will further our strategy in the capital markets domain.”

Viteos Group is Wipro’s second acquisition of the month. The company announced plans to acquire IT consultancy Cellent AG for €73.5 million early in December and, in June, Wipro launched its e-KYC solution which leverages its AI platform, Wipro HOLMES. The company began the year with a major, multiyear, IT outsourcing contract with Allied Irish Banks (AIB).

Founded in 1945 as Western India Palm Refined Oils Limited, Wipro is headquartered in Bangalore, India. A multinational IT consulting and systems-integration firm, Wipro demonstrated its Wipro ngGenie myAdvisor technology at FinovateEurope 2015.

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2015: A Year in Finovate Alumni Mergers and Acquisitions

2015: A Year in Finovate Alumni Mergers and Acquisitions
By David Penn Posted on
Categories: Akimbo Financial, Aurora Financial Systems, Authentify, Blockstack.io, eMoney Advisor, Finicity, FIS, Funding, Fundings, FutureAdvisor, GoNow, Guide Financial, Kofax, Kontomatik, Kreditech, LearnVest, Mergers & Acquisitions, Q2, ReadyForZero, Red Zebra, Social Money, Stratos, Toopher, Urban FT, Wipit, Yodlee

Handshake_graphic

2015 was another big year for mergers and acquisitions in the fintech industry. And whether they were the acquirer or the acquired, Finovate alums were very much a part of the M&A action.

Because terms of many deals were undisclosed, it is difficult to get a precise number on how much money was spent acquiring some of fintech’s most promising startups this year. But looking just at those acquisitions for which figures were available, we can see that 2015 was a banner year in M&A (more than $7 billion) — and that’s just counting alums.

So from the $5 billion deal between FIS and Sungard to the “alum-acquires-alum” mergers of September 2015, let’s take a closer look at some of the major unions of the year that featured Finovate alums.

December

October

September

August

July

May

April

March

February

January

If you’re a Finovate alum whose merger we’ve missed or acquisition we’ve overlooked, let us know. Send us an email at research@finovate.com.

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Finicity Acquires Aurora Financial Systems

Finicity Acquires Aurora Financial Systems
By David Penn Posted on
Categories: Aurora Financial Systems, Finicity, Funding, Mergers & Acquisitions

Aurora_Note_logo_Sep2015As we were about to publish the Finovate debut feature for Aurora Financial Systems, we were asked to hold off by Chris Melendez, vice president for corporate partnerships. “There may be some big news coming,” he said.

Finicity_logo_FinDEVr2015This week, the big news arrived: Aurora Financial Systems has agreed to be acquired by fellow Finovate alum, Finicity.

In a statement released earlier this week, Finicity announced it had acquired “substantially all the assets” of Aurora Financial Systems. Aurora will become part of Finicity’s Data Services Division and will be led by Melendez and Aurora co-founder Michael Ciberey. The terms of the acquisition were not disclosed.

A division of Finicity Corporation, Finicity Data Services provides API services for fintech developers building account aggregation, cash-flow verification, and account-ownership-verification solutions. With the acquisition of Aurora Financial Systems, Finicity will add transaction processing and card program management to its developer stack.

With the acquisition, Finicity is intensifying its promotion of its TxPUSH real-time financial data delivery. Finicity co-founder Nick Thomas highlighted Aurora’s TxPUSH Event Management API and Event PUSH Delivery engine as “standards-based solutions” for delivering card transaction data “immediately, not three days from now.”

“Real-time transaction data opens many new doors for fintech innovators,” Thomas said.

FinDEVr2015LogoV2DateFounded in 1999 and headquartered in Salt Lake City, Utah, Finicity’s Data Services division launched its TxPUSH API for fintech apps at FinovateSpring 2015. The company will make its FinDEVr debut next month at FinDEVr 2015 San Francisco (early bird ticket sales end this Friday) where it will demonstrate real-time data delivery via its TxPUSH API.

Aurora Financial Systems made its Finovate debut at FinovateSpring 2015 in San Jose, Calif., with the debut of Note, a vertically integrated budgeting solution for FIs. But the Purchase, New York-based company’s pedigree is as a debit processor and program manager specializing in incentive, payroll, and reloadable, prepaid solutions. Aurora has processed millions of dollars of transactions within these categories since its founding in 2009.

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Early Warning Acquires Authentify

Early Warning Acquires Authentify
By Julie Muhn (@julieschicktanz) Posted on
Categories: Authentify, Mergers & Acquisitions, Payfone

EWSAuthentifyAcquisition

Authentify, a company that offers phone-based, multifactor authentication to more than 1,200 financial institutions and e-commerce companies, today announced it will soon be acquired.

The acquirer is Chicago-based Early Warning, a company owned and governed by the largest banks in the U.S. and which provides risk-management solutions to 1,100 banks, government entities, and companies. Once the Authentify acquisition is under its belt, Early Warning will bolster its current offering with a multifactor authentication solution that integrates multiple channels and authentication methods.

The terms of the acquisition were not disclosed.

AuthentifyHomepage

This is not Early Warning’s first move to broaden its offerings. In 2013, the Arizona-based company partnered with Payfone to combine device and customer-identity authentication with transaction data to ensure security. Early Warning has an equity stake in Payfone.

Authentify was founded in 1999 and Peter Tapling is CEO. The company demonstrated 2CHK at FinovateFall 2011.

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Printer Giant Lexmark to Acquire Kofax for $1 Billion

Printer Giant Lexmark to Acquire Kofax for $1 Billion
By Julie Muhn (@julieschicktanz) Posted on
Categories: Kofax, Mergers & Acquisitions

KofaxHomepage

Kofax creates mobile and web solutions made to simplify customer interactions. The California-based company announced today it has been acquired by Kentucky-based Lexmark International, a global corporation with approximately $3.8 billion in revenue.

Kofax’s Board of Directors, which accounts for 25% of the company’s shareholders, unanimously voted in favor of the merger. Lexmark will pay $11 per share in cash for all outstanding shares of Kofax, for a total value of $1 billion (net of cash acquired).

Lexmark is well-known for its hardware, such as printers, copiers, and fax machines. The company also distributes document imaging and electronic form software, under the brand Perceptive Software, that competes with Kofax’s offerings. Scott Coons, Perceptive Software president and CEO and Lexmark VP states:

“The combination of Perceptive Software and Kofax solutions strengthens the breadth and depth of our offering, giving us an… ability to help customers… connect unstructured information to their systems of record.”

Additionally, Lexmark anticipates the acquisition will expand its reach to mid-market business customers. Kofax has 20,000 customers and 850 channel partners across the globe.

LexmarkHomepage

When the acquisition closes in Q2 of 2015, Lexmark will double the size of the software branch of its business.

Kofax was founded in 1985. Reynolds Bish is CEO. The company last demoed at FinovateSpring 2014 where it debuted its Mobile Capture Platform. Kofax won Best of Show at FinovateAsia 2013 in Singapore.

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