Out of the 31 FinTech funding rounds we reported on last week, PayTech companies, neobanks and lending enterprises were the clear winners.
It’s been a busy week for FinTech aficionados with companies in all sectors such as lending, CyberTech, cryptocurrency and neobanking scoring multi-million funding rounds. The largest funding was Pine Labs’ colossal $600m round led by Fidelity Management & Research Company and BlackRock giving it a valuation of $3.5bn.
The payments and merchant commerce startup, known for its card-reading terminals at retail stores is expanding its digital payments services, consumer credit and business loans. Pine Labs has been diversifying its offerings on its newly developed software platform with enterprise solutions such as buy now pay later integrations, invoice management, payment gateway and prepaid card issuance. It is also working closely with Indian banks to acquire merchants onto banking networks and digitise cash flow in stores. The firm is eyeing a US IPO in the next 18 months as it looks to expand in both Indian and south-east Asian markets such as Singapore, Indonesia and Malaysia.
The round makes Pine Labs one of the highest-valued and most well-capitalised FinTech companies in India, behind IPO-bound Paytm and Walmart-backed PhonePe. Moreover, the country is increasingly embracing digital payments with more people as well as businesses using contactless methods. Pine Labs is hardly the only digital payments company that is witnessing an upward graph. India continues to see a smattering of startups innovating in the sector with firms such as BharatPe, Razorpay, PayU, MobiKwik, Instamojo, BillDesk among others. According to the Reserve Bank of India, India has deployed 4.94 million PoS devices as of January 2020. Recently, Paytm forayed into the business of the development of POS solutions for servicing its merchants with accounting and billing solutions.
The meteoric rise of PineLabs also highlights the growth of the Indian FinTech ecosystem, an extremely promising emerging market with a predicted sector evaluation of $150bn-160bn by 2025. Last week InsurTech Digit Insurance, backed by Indian cricket team captain Virat Kohli, secured $200m. To add on, since January 2021, the country saw 14 new unicorns, of which six were FinTechs – namely Digit Insurance, Five Star Business Finance, CRED, Groww, Zeta and Chargebee. FinTech companies in India have already secured $2.3bn in the first six months of 2021 – a figure poised to skyrocket further by the end of the year.
The payment sector is indeed going from strength to strength across the globe, not just in India. The point of sale (POS) system market, which was valued at $31bn in 2020, is expected to reach $68bn by 2026, at a CAGR of 13.60% over the forecast period 2021 – 2026, according to a study by ResearchAndMarkets.com. Pine Labs competes with industry giants such as Stripe Connect, Payoneer, GoCardless among others. Stripe, the $95bn FinTech, has taken its first major step toward a stock market debut. Wise, formerly TransferWise, too was listed on the London Stock Exchange last week.
The second largest funding round that we reported on last week was neobank Bunq securing $228m led by Pollen Street Capital, the largest Series A ever for a European FinTech, giving the company a valuation of $1.9bn. As part of the funding round, Bunq also made its first acquisition in Capitalflow Group, an Ireland-based lender to help the digital bank branch out into SME lending. In April this year, bunq joined TARGET Instant Payment Settlement service to offer instant payments across Europe. This gives bunq users instant payments with participating banks in its home country of the Netherlands and the rest of Europe.
Bunq’s funding round comes after the global WealthTech sector recorded another spike in Q1 of 2021 in terms of investment raised. WealthTech companies raised over $6.6bn. The global WealthTech industry saw strong growth in investment between 2017 and 2020 as deal activity also increased in 2020 with 443 deals being completed compared to 388 transactions in 2019, according to FinTech Global’s research. That is up considerably from 2016 when the global WealthTech sector raised $2.8bn across 314 rounds in total. In 2020, half of the top ten biggest WealthTech rounds were raised in the digital banking sector.
For comparison, US rival Chime achieved a $14.5bn valuation in September 2020 whereas UK rival Revolut is eyeing a fundraising effort that could value the banking and payment app at more than $30bn. Apart from Bunq, last week saw digital banking firms like Juni and Fairmoney top up their coffers.
Another sector which witnessed a slew of startups banking big rounds was the lending sector. Companies such as Clearco, Lidya, Younited Credit, Payhippo and Loanpro hauled in big rounds last week. While global marketplace lending investment in Q1 2020 declined compared to 2019, the global peer to peer lending market size is projected to reach $558.91bn by 2027, growing at a CAGR of 29.7% from 2020 to 2027, according to Allied Market Research. The small business loan segment is expected to garner a significant share during the forecast period. This is attributed to the rise in number of small businesses in developing countries.
With that being out of the way, let’s look closer at the 31 FinTech funding rounds we reported on in the last week.
Pine Labs’ $600m round ahead of US IPO
Payments and merchant commerce startup Pine Labs raised $315m after it had raised $285m in an earlier tranche in June, ascribing it a post-money valuation of nearly $3.5bn. New investors such as Fidelity Management, as well as funds managed by BlackRock, Ishana, Tree Line, and Neuberger Berman Investment Advisers participated in the round.
The funding is pending approval from India’s capital markets regulator, the Securities and Exchange Board of India. The coronavirus pandemic in India has accelerated merchant adoption of digitised solutions not just for payments but also for services such as billing and invoice management, where now Pine Labs is looking to establish scale.
The firm will now scale its software commerce stack, which allows merchants to automate payment and billing services at storefronts.
Bunq banks $228m
Dutch challenger bank Bunq has never raised capital from external investors—until now. The digital bank has closed a $228m Series A funding round led by Pollen Street Capital and has solidified its position as a unicorn, hitting a valuation of $1.9bn.
Having put $116.6m of his own money into Bunq since 2012, CEO and founder Ali Niknam said that the digital bank saw its user deposits top €1bn, more than doubling on the year before. Bunq is also still helping its customers to go carbon neutral, having planted 3.7m trees on their behalf in partnership with the Eden Reforestation Project.
Bunq offers bank accounts and debit cards that users can control from a mobile app. It works particularly well when sending money with other people using Bunq, splitting payments and more.
Clearco collects $215m
Toronto-based Clearco — formerly Clearbanc — raised $215m in growth equity round led by SoftBank Vision Fund 2 as the company eyes further international expansion.
Founded in 2015, the company has now raised more than $681m. Clearco offers revenue-based advances to startups mainly in the e-commerce, SaaS and mobile apps market. Clearco will use the new cash to expand abroad after it opened offices in the UK in early 2020. Earlier this year the company started its ClearAngel platform to help finance early-stage companies and give them resources to grow without taking an investment stake in the young companies.
Indian InsurTech unicorn Digit Insurance bags $200m
Digit Insurance, offering health, car, bike, and travel insurance, secured $200m from Faering Capital and new investors Sequoia Capital India, IIFL Alternate Asset Managers in its latest round of funding, subject to IRDAI approval. Among Digit’s investors are TVS Capital Funds, A91 Partners, Indian Cricket team captain Virat Kohli and the employees of Digit.
Despite the overall industry growing around only 5% last year due to the pandemic, Digit claims that it grew by 44%, with a premium of Rs 3,243 crore between April ’20 – March ’21. Digit has over two crore customers and has processed more than four lakh claims.
Younited Credit reels in $170m
Paris-based credit and payment platform Younited Credit raised $170m in a funding round joined by Goldman Sachs and Bridgepoint. Funds raised will be used to consolidate Younited’s presence on the European market in France, Italy, Spain, Portugal and Germany, the latter four countries already representing 40% of Younited’s revenues.
Younited Credit differentiates itself from legacy players with a data-driven, AI-based approach. The company takes advantage of DSP2 regulation and open-banking APIs to ingest data. The new funding will be used to build the partner network, launch a staged payment product that lets firms offer customers the option to spread payments over three to 48 months, and hire 200 staffers.
Pleo earns the horn after $150m funding
Danish-born provider of expense management tool and smart company cards Pleo raised $150m in Series C funding.
The round, which brought the valuation of the company to approximately $1.7bn, was co-led by Bain Capital Ventures and Thrive Capital with contributions from Creandum, Kinnevik, Founders, Stripes and Seedcamp. The company intends to use the funds to expand its solution across Europe, growing its customer base, invest in its team, which currently stands at 330 people, while iterating its product offering.
Digital lender Loanpro hauls in $100m
LoanPro, SaaS-based loan management, servicing and collections platform for alternative, FinTech and traditional lenders, raised a $100m growth equity investment in a Series A funding round from FTV Capital, a growth equity investor.
Through this capital raise, LoanPro will enhance its platform functionality, enter new lending verticals, and further invest in client-centric growth initiatives. The platform reportedly has more than $15bn of loans under management and over 600 clients across a diverse range of loan types and lending programs in the US and Canada.
Deep instinct banks $67m
Deep Instinct secured a new $67m investment in the company by Chrysalis Investments. This brings its total funding to $240m.
Deep Instinct applies end-to-end deep learning to predict, identify and prevent cyberattacks. The cybersecurity vendor’s customers span a range of different industries including finance, education, retail and technology. In April, Deep Instinct had raised $100m in Series D funding. Deep Instinct will use the majority of the money to bolster sales, marketing and product engineering.
Neobank Fairmoney inks $42m
Nigeria-based FairMoney raised $42m Series B to expand and diversify offerings for its users in Nigeria and India.
The round was led by Tiger Global Management and existing investors from the company’s previous rounds, DST Partners, Flourish Ventures, Newfund and Speedinvest, also participated. With the latest investment, the company’s total fundraising comes to about $55m. Since its launch, the company has grown its user base to about 3.5 million registered users which includes 1.3 million unique bank account holders.
Felicis leads r2c’s Series B funding
Startup building a SaaS service around the Semgrep open-source project r2c secured $27m in Series B funding, led by Felicis Ventures with participation from previous investors Redpoint Ventures and Sequoia Capital.
With a focus on cybersecurity, the startup sells a monthly, per-developer subscription that packages a broad set of security-focused rules across different coding languages, allowing companies to easily check their own software for possible security issues.
Juni nets $21.5m
Sweden-based financial companion for e-commerce entrepreneurs Junni raised $21.5m in Series A financing. Backers included partners of DST Global, Felix Capital, Cherry Ventures and other early investors.
The company intends to use the funds to focus on product development and recruiting. From a product perspective, Juni will introduce a number of features in the coming months such as automation of administrative tasks, a unified view of financials tailored to ecommerce merchants and media buyers, and a number of services to financially empower digitally native companies to grow their business.
Assures Allies pulls in $18.3m
Boston MA- and Tel Aviv, Israel-based evidence-based ageing innovation company Assures Allies raised $18.3m in Series A funding.
The round was led by Core Innovation Capital and New Era Capital Partners with participation from Wilton Re, LionBird Ventures and Harel Insurance. The company intends to use the funds to accelerate the delivery of its Age Assured program and continue to develop new ageing innovations, based on its patent-pending technology for predicting the ageing trajectory and its proprietary ageing score.
Willa gets $18m
Sweden-based creator economy fintech company Willa raised $18m in Series A funding. The round was led by FinTech Collective, with participation from Entrée Capital and EQT Ventures.
The company intends to use the funds to expand its invite-only beta to a waitlist of 150,000+ freelancers in the United States and to grow its active user base. The startup aims to enable freelance workers to optimize their working conditions, spend less time on paperwork, and get paid for the work they have done without waiting for their money.
Moneyhub scoops in $18m
Open banking platform Moneyhub has secured its biggest investment of $18m to help it fuel its expansion plans across Europe, with Peter Wood, founder of Direct Line and Esure, taking the lead on its latest round, via a newly formed investment vehicle SPWOne.
The app is designed to help employers support their employees’ financial wellbeing and promises to save employees an average of £850 each, with room to save even more. Moneyhub has already established a market-leading product in the enterprise market in the UK and now boasts clients including Mercer, Aon, Nationwide and Standard Life.
Sevco snags $15m
cloud-native security asset intelligence platform Sevco Security raised $15m in Series A funding. The round was led by SYN Ventures, with participation from .406 Ventures, Accomplice, Bill Wood Ventures and Fama Ventures.
Led by J.J. Guy, Sevco provides a cloud-powered security asset intelligence platform that delivers continuous converged visibility of all assets across siloed systems; and the telemetry required to understand how assets change in a dynamic environment over time.
NanoLock Security closes $11m round
NanoLock Security raised an $11m Series B funding round from new investors OurCrowd, HIVE2040 and Atlantica Group as well as current investors AWZ Ventures, a private investment group that includes former Canadian Prime Minister Stephen Harper.
This investment round will aid NanoLock in accelerating their global developments of device-level cybersecurity solutions and further the company’s penetration into utilities, industrial, and critical infrastructure markets. Furthermore, NanoLock has acquired an additional new patent with the United States Patent and Trademark Office. The Access Control for Integrated Circuit Devices patent covers a security system for devices that physically locks the hardware memory by preventing overwrite, modification, manipulation, or erasure of data stored in the memory.
Canopy collects $11m
cloud-based practice management platform for accounting professionals Canopy raised $11m in funding. The round includes new investor Ankona Capital as well as existing investors NewView Capital, Pelion Venture Partners and Tenaya Capital among others.
The company intends to use the funds to continue to build its cloud-first, mobile, modern practice suite. Canopy provides cloud-based practise management software to thousands of accounting professionals nationwide. Committed to data security, its solutions are SOC2 certified and data encrypted to ensure personal information is secure.
Blockpit banks $10m
Austria-based provider of legally compliant and audited tax reports for the treatment of crypto-assets Blockpit raised $10m in Series A funding. The round was led by MiddleGame Ventures with participation from Fabric Ventures, Force over Mass Capital, Tioga Capital (Casa), Avaloq Ventures, Venionaire via its Luxembourg fund, EXF Alpha S.C.S. The company intends to use the funds to further develop Cryptotax and to make it available across additional countries.
Blockpit provides Cryptotax, a tax reporting software platform that offers automated calculation of taxable profits from trading crypto-assets such as Bitcoin and Ethereum, as well as from other activities of crypto traders and investors such as income from staking, DeFi, lending, mining, and margin trading.
Invoice finance startup Arex Markets bags €8.8m
Data-driven FinTech company that drives financing costs down for SMEs and enables them to get access to cash quicker, Arex bagged a Series A funding round, securing €8.8m to accelerate its rollout in the UK and Spain.
Mosaic Ventures and LocalGlobe led the round, joining existing investors Lifeline Ventures and angel investor Richard Laxer, former CEO of GE Capital. AREX had previously raised seed funding of €3m in 2016. The AREX technology integrates into our customers’ software and processes by using data to drive automation of the often cumbersome financing workflow.
Lidya raises $8.3m
Nigerian based lending startup Lidya has raised an $8.3m pre-Series B funding round.
The funding round was led by Alitheia Capital through its uMunthu Fund. Other participating investors include Bamboo Capital Partners, Accion Venture Lab and Flourish Ventures. The new influx of funding will be used to grow its lending operations for small and medium businesses across its markets. The startup provides financing based on the cash flow in your bank account and without collateral.
Zerion inks $8.2m
San Francisco CA-based focused developer of an investing interface for decentralized finance (DeFi), Zerion raised $8.2m in Series A funding. The round was led by Mosaic Ventures with participation from Placeholder, DCG, Lightspeed, Blockchain.com Ventures, DeFi Alliance Fund, Continue Capital, SevenX Ventures, G1 Ventures, Bitscale Capital, Wintermute, The LAO and a group of angel investors from the crypto community.
Led by Evgeny Yurtaev, Vadim Koleoshkin and Alexey Bashlikov, Zerion provides is an investing app that enables anyone, anywhere in the world, to access a suite of new financial products and services built on decentralized finance.
Toqio raises €8m in seed funding
UK-based provider of a SaaS global financial platform Toqio raised €8m in seed funding. Backers included Seaya Ventures, Speedinvest and SIX FinTech Ventures.
The company intends to use the funds to expand the platform, scale the team from 19 to over 100, across product, sales and more, as well as secure a market position in Europe and enter the US market. Toqio provides a SaaS-based global financial platform that enables any business to launch financial solutions, without building and managing complex software solutions.
Crush Capital caps $2.75 in funding
Crush Capital, FinTech company behind the upcoming streaming series “Going Public,” raised $2.75m in funding. The round was provided by AYA Capital Holdings, LLC, with participation from Zilliqa Capital and Terraform Capital, bringing total funding to $6m.
The company will use the funds to accelerate the show’s development and advance its goal of bringing IPO and pre-IPO investing to retail investors around the world.
Going Public chronicles a diverse group of company founders on their journeys to raise capital from big-name investors and the viewing public alike in pursuit of a Nasdaq listing. Its 10-episode premiere season will be hosted by Lauren Simmons. Prominent business leaders appear on-camera as mentors, including Priceline entrepreneur Jeff Hoffman, Schmidt’s Naturals founder Jaime Schmidt, and Josh Snow, founder of SNOW, a nine-figure oral care cosmetics brand.
Payhippo reels in $1m
Nigerian FinTech startup Payhippo raised $1m in pre-seed funding to scale its offering, which provides vital loans to small businesses. Launched in January of last year by Chioma Okotcha, Uche Nnadi and Zach Bijesse, Payhippo provides loans to small businesses in Africa, often neglected by banks because of their lack of credit histories, in under three hours.
Investors include Ventures Platform, Future Africa, Launch Africa, Sherpa Ventures, DFS Lab, Hustle Fund and Mercy Corps Ventures. So far, Payhippo, which helps customers generate their own alternative credit scores, has disbursed over 2,600 loans to businesses and had a 97% repayment rate.
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