Finovate Alumni Raise $825 Million in 2013, Up 79%

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Cheers to a new year! After ringing in 2014, we wanted take a look back at the capital raised by Finovate alumni in 2013. It was quite a year, with alums pulling in $825 million, $365 million more than in 2012 for an increase of about 80%.
2013 funding summary:
    • 62 companies raised $825 million
    • Q4 had the most capital, with a total of $294 million raised by 17 companies (more than half by Xero, which landed $150 million). 
    • October was the busiest month, with $177 million raised (mostly Xero’s $150 million)
    • May was second highest with $91 million raised by 7 companies
2012 comparison
Last year Finovate alums took in almost twice as much as 2012, when 44 Finovate alums collectively raised $460 million. The chart below shows the quarter-by-quarter comparison for both years.
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Quarter 1 — blog post
More than $155 million raised by 14 companies
January — $57 million raised by 6 companies
February — $56 million raised by 5 companies

March — $42 million raised by 4 companies


Quarter 2 — blog post
More than $205 million raised by 15 companies
June — $81.7 million raised by 6 companies
May — $91.5 million raised by 7 companies
April — $32 million raised by 2 companies

Quarter 3 — blog post
More than $171 million raised by 22 companies

July — More than $63 million raised by 8 companies
August — More than $26 million raised by 6 companies
September — $82 million raised by 9 companies
Quarter 4
More than $294 million raised by 17 companies

October— $177 raised by 6 companies
November — More than $87 million raised by 7 companies
December — More than $30 million raised by 6 companies

Note: Funding that companies received before they first appeared at Finovate was not counted. Questions? Comments? Email us at julie@finovate.com or david@finovate.com.

SEC’s Recent Vote May Ease Operating Restrictions for Nine Finovate Alums

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The U.S. Securities and Exchange Commission (SEC) this week unanimously voted to approve the proposed rules that will govern online crowdfunding. Under these provisions, companies will be allowed to offer and sell securities through crowdfunding.

Some of these companies have been waiting since early 2012, when Obama signed the JOBS Act, for the SEC to create the regulation, which is intended to protect private, non-accredited investors. 

Investors who earn under $100,000 per year will be limited to $2,000 per year investment, or 5% of their income, and those who make over that amount will be limited to invest 10% of their income annually. However, in order to reduce burdens on the companies raising the funds, and the funding portals, the new regulation does not explicitly require them to verify the income of the individual investors.

According to the SEC’s press release, its proposed rules would require SEC-registered intermediaries (broker-dealers, funding portals) to:

    • Educate investors
    • Manage the risk of fraud
    • Provide information about the issuer and the offering
    • Furnish communication channels
    • Facilitate the offer and sale of crowdfunded investments
The proposed rules would prohibit them from:
    • Offering investment advice or making recommendations
    • Soliciting purchases, sales or offers to buy securities 
    • Restricting compensation for solicitations
    • Holding, possessing, or handling investor funds or securities

Before the rules are passed, they must go through a 90-day comment period, after which, they may be altered to reflect the comments. Once the final rules have been decided, the nine Finovate alums below will be able to solicit to non-accredited investors, subject to the SEC’s final ruling.

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Founded: 2011

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Founded: 2012

LendStreetLogo.jpg

Founded: 2010

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Founded: 2010

P2BiLogo.jpg

Founded: 2012

RealtyMogulLogo.jpg

Founded: 2012

Rebirth_Financial.jpg

Founded: 2010

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Founded: 2012

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Founded: 2011
FinovateSpring 2012 demo

From an operational standpoint, life for these startups will be a bit easier after the SEC passes the provisions, since it will increase the number of investors on their platforms. They will, however, be faced with increased regulation, which Forbes estimates will cost more than $100,000 annually. This estimate includes procuring and offering disclosure documents, enlisting a funding portal, running background checks, and filing an annual report with the SEC.

The first provision of the JOBS Act, which allows companies to advertise to accredited investors, went into effect September 23.

Four Finovate Alumni Featured in OBR Crowdfunding Report

Four Finovate alumni were featured in the latest publication from Online Banking Report (OBR).

Bolstr

  • Thumbnail image for BolstrLogo.jpgDebt-based / Crowdlending
  • Headquartered in New York, New York
  • Presented at FinovateFall 2012
  • Demo Video

P2Binvestor

  • Thumbnail image for P2BiLogo.jpgReceivables-based / Crowdfactoring
  • Headquartered in Louisville, Colorado
  • Presented at FinovateSpring 2013
  • Demo Video
  • Thumbnail image for RealtyMogulLogo.jpgDebt-based / Crowdlending
  • Headquartered in Los Angeles, California
  • Presented at FinovateSpring 2013
  • Demo Video
  • Thumbnail image for SoMoLendLogo.jpgDebt-based / Crowdlending
  • Headquartered in Cincinnati, Ohio
  • Presented at FinovateSpring 2012
  • Demo Video

The report is an in-depth look at the emerging trends in crowdfunding and features a look at 18 up-and-coming platforms. OBR Subscribers can access the report here. It can also be purchased for US$495 here.

Finovate Alumni News– May 8, 2013

  • Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Thumbnail image for Finovate-F-Logo.jpgThe Wall Street Journal takes a look at “bitcoin startups” including OpenCoin. Come meet them at FinovateSpring in San Francisco.
  • Currensee announces launch of Trade Leaders managed fund.
  • US Bankcard Services now providing AuthenticID service to its merchants.  See AuthenticID demo at FinovateSpring next week.
  • Check Point introduces 600 Series security appliances for SMBs.
  • Forbes lists SoMoLend as 1 of 10 top crowdfunding sites for fundraising.
  • Investor Junkie reviews Jemstep. Come see what’s new at Jemstep at FinovateSpring next week.
  • MoneyDesktop honored with Bronze award in the Telly Awards, which recognize the finest video, film, & web commercials. See them demo at FinovateSpring.
  • Business Insider names BillGuard as 1 of the 20 hottest startups from Israel.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alumni News– April 15, 2013

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  • INTJ Capital compares and contrasts Quantopian and QuantConnect. Join Quantopian in San Francisco for FinovateSpring.
  • MicroStrategy launches mobile app Usher, e-wallet for digital I.Ds, keys. See them demo at FinovateSpring in May.
  • Paybefore takes a look at the TSYS‘s acquisition of NetSpend and ponders “prepaid’s end game.”
  • Monitise Group Strategy Director Richard Johnson talks about trends in mobile money.
  • BancVue chooses MicroStrategy platform for business analytics.
  • CPA Practice Advisor takes a look at the new, updated iPad app from Kashoo.
  • This is Money blog looks at Zopa’s growth.
  • Yodlee awarded 50th patent for financial gadgets.
  • SoMoLend travels nationwide to teach small businesses & investors about crowdfunding.
  • Austin Business Journal considers BancVue’s inverted sales pitch.
  • Newfination hosts SoMoLend CEO, Candace Klein, who explains how the platform’s  crowdfunding capability.
  • Intelligent HQ interviews The Currency Cloud’s CEO, Michael Laven.
  • Pando Daily profiles crowdfunding pioneers like SeedInvest and SoMoLend. Join SeedInvest in May for FinovateSpring.
  • The Next Web interviews TipRanks‘s CEO and co-founder Uri Gruenbaun.
  • Chevron teams up with WattzOn to launch The Capacity Project for sustainable growth.
  • Refundo launches free iPhone app. Check out Refundo’s live demo at FinovateSpring.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

First Quarter 2013 Funding for Finovate Alumni– More Than $150 Million Raised

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This quarter, both January and Feburary funding exceeded $50 million. Most of February’s funding can be attributed to On Deck Capital’s $42 million round.

Over three months, 15 companies raised more than $155 million, This is very similar to last year’s first quarter funding* when we saw a total of 11 companies raise more than $150 million.

Here’s the Q1 summary for 2013:

January — $57 million raised by 6 companies
February — $56 million raised by 5 companies

March — $42 million raised by 4 companies

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*While the funding over last year has increased, so has the number of Finovate alums. We’re tracking more than 100 additional companies this year compared to last year.

Note: Funding that companies received before they demonstrated at Finovate was not counted. Questions? Comments? Email us at julie@finovate.com or david@finovate.com.

Finovate Alumni News– April 8, 2013

  • Finovate-F-Logo.jpgInvestors Business Daily interviews Barry Silbert, SecondMarket CEO, who says the stock market is broken.
  • Xero opening new LA office for Southern California team.
  • Bank Innovation reports: Fiserv Tops 1 Million Mobile Deposit Capture Users, 7 Million Mobile Users.
  • Radio New Zealand reports: Xero to launch fully into U.S. market in July.
  • Candace Klein, SoMoLend CEO, discusses the hardship that the SEC’s delay of the JOBS Act has caused.
  • Dwolla updates Magneto extension.
  • Yodlee receives 2013 Honorable Mention in Industry Partner category for the Barlow Research Associates’ Monarch Innovation Awards.
  • Virtual Piggy integrates with Oracle ATG Web Commerce, expands reach of network to more than 390,000 brands.
  • Mitek’s Mobile Deposit solution receives top award for Overall Most Innovative from Barlow Research Associates.
  • Management Today interviews Zopa CEO, Giles Andrews.
  • TechCrunch looks at Realty Mogul and its recent win at the Founder Showcase pitch competition. See them in action at FinovateSpring in May.
  • GreenDot and UniRush launch reloadable prepaid Visa card. Join GreenDot for FinovateSpring in San Francisco.
  • Allied Payment Network bill payment technology integrates with CSPI’s Aurora online banking platform.
  • Zooz announces partnership with ChronoPay. Join Zooz in San Francisco for FinovateSpring in May.
  • Identity Theft 911 CEO to lead discussion on social media and insurer risk at upcoming NAMIC seminar.
  • Roadtrip Nation interviews Dan Reed of Bazaarvoice.
  • Money Street Smart reviews TradeKing.
  • Hard Assets Alliance features an interview with Gold Bullion International CEO Steven Feldman.
  • Newfination interviews Taavet Hinrikus of TransferWise.
  • Engine talks about rewarding risk-takers with GoodApril founder Benny Joseph.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alumni News– March 26, 2013

  • Thumbnail image for Finovate-F-Logo.jpgTransferWise featured in HuffPost Students United Kingdom.
  • EZBOB investor John Garfield profiled in The Telegraph.
  • Money.co.uk compares money transfers through Azimo.
  • Fiserv partners with Romania-based Eutron Invest to provide Cash and Logistics solution portfolio to the Romanian market.
  • Forbes looks at the “best of the best” debt crowdfunders including Lending Club, Prosper, Zopa, SoMoLend, Rebirth Financial.
  • SecureKey announced availability of its cloud-based briidge.net identity and authentication platform.
  • ID Analytics introduces fraud detection solutions for online retailers.
  • The Globe and Mail lists Expensify as 1 of 5 apps that take the bumps out of business travel.
  • Petter Made, co-founder and COO of SumUp, talks about the advantages of Dublin as a base for business.
  • Credit Union Times reports: Fiserv launches SpotPay.
  • Finextra reports G&D and PayPal team on pre-paid mobile top-ups in Brazil.
  • Practical eCommerce takes a look at Klarna Invoice for OSC programs.
  • CSI’s globalVCard wins top entrepreneurial prize at 2013 Innovation Project.
  • Newfination interviews CurrencyFair’s Brett Meyers.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

Finovate Alumni News– March 11, 2013

  • American Banker reports: Union Bank signs up for Fiserv’s Bill Pay.
  • Bolstr featured on MSNBC’s Your Business.
  • Backbase gives a glimpse of the Digital Marketing Module it showed at FinovateEurope.
  • Triple Pundit looks at how the SEC is holding SoMoLend and other debt/equity crowdfunding platforms hostage.
  • USA Today considers Lending Club’s success.
  • CIO lists Expensify as 1 of 3 apps to help at tax time.
  • BellaDati releases updates to its platform.
  • Credit Karma launches app for Android.
  • Med Gadget interviews Diversinet CEO, Dr. Hon Pak.
  • Finextra reports Geezeo signs 1st United Services Credit Union.
  • CashStar announces availability of tablet gifting.
  • Android, iOS updates now provide card-to-card payments with Pageonce.
  • Dough Roller blog names PocketSmith one of the best calendar-based personal finance apps.
  • Continuity Control to partner with cbanc Network to provide regulatory briefing via RegAdvisor.
  • Koolspan and DeviceFidelity team up to build TrustSleeve, bringing microSD-based voice encryption to the iPhone.
  • Locaid and Life360 join forces to help parents stay in touch with their kids.
  • The Financial Brand highlights 50 of the most spectacular website designs in banking: Simple (formerly BankSimple), Standard Chartered, Mint, & Moven. See Netbanker’s take on the list here.
This post will be updated throughout the day as news and developments emerge. You can also follow all the alumni news headlines on the Finovate Twitter account.

SoMoLend Closes Seed Round of Funding Totaling Over $2 Million

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Debt-based crowdfunding platform SoMoLend announced today that it has completed its Seed round of funding, totaling over $2 million.

A recent $400,000 investment from Virginia-based QED Investors finished off the Seed round. Prior investments contributing to the total amount include:

    • $1.2 million in May of 2012
    • $310k in September 2011

The Cincinnati-based startup plans to use the funding to expand marketing, develop fundraising tools, and enhance the platform by adding social networking features.

To learn more about SoMoLend, watch its FinovateSpring 2012 demo.