Why last week felt like 2021 in fintech

Welcome back to The Interchange, where we look at the hottest fintech news of the past week. If you want to receive The Interchange directly in your inbox every Sunday, head over HERE to sign up! Last week, we chronicled some of the big moves in the fintech space, Intuit’s decision to shut down Mint and what that means for startups and more. Read more!

The return of mega-rounds

Last week felt like 2021. Well, sort of.

There have been at least three nine-figure funding rounds in the fintech space announced in the past week. It’s rare these days to see ONE nine-figure round, let alone two or three. So we’re excited to say the least.

First, I covered the Brazilian banking-as-a-service startup This is QI Tech $200 million increase led by General Atlantic. This is a big deal, besides a lot of money, because it also marks the biggest venture round in Brazil so far this year – not only in fintech, but in all industries. The company was gracious enough to share its revenue figures, which are also unusual, as revenue increased by 89% in the first half of 2023 compared to the same period last year. It also proves that infrastructure continues to be strong, even during recessions. Earlier this year, Visa announced it would acquire Brazilian payments infrastructure company Pismo in a $1 billion deal.

Meanwhile, in the Middle East, Tabby It raised $200 million in a Series D funding round that valued it at $1.5 billion. I’m a little surprised that a buy now, pay later platform would attract so much venture capital considering that many players in the space have had their challenges in the last year or so. But TC’s Tage broke it down for us, explaining that the markets where Tabby operates don’t have the same kind of access to credit cards that we do in the US. loans; where this is seen as a convenience​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​ takes away with you, it is important for many consumers in the Middle East and, by extension, the Gulf. Tabby’s income, too!

And last but not least, Palo Alto, based in California Next Insurance it was announced landed $265 million in strategic capital from Allianz and Allstate. As reported by CNBC, Next is “close to $1 billion in premium revenue but remains unprofitable.” In April 2021, TechCrunch reported that the SMB-focused insurance provider raised a $250 million round at a value of $4 billion.

Combined, the three fintech companies have raised $650 million alone. And it noted that two out of three companies are located in markets outside the US

While I don’t think this means we’ll suddenly see mega-rounds on the regular, it’s still encouraging news for the space!

You can listen to Alex Wilhelm, Becca Szkutak and I (Mary Ann) drill down on the topic on Friday’s episode of Equity:

Where are all the Mint users going?

Now that Intuit says it is stop personal finance app Mint in January, the company hopes most Mint customers will stay and join Credit Karma. However, some of Mint’s competitors tell me they’ve already seen a bump in new customers.

Monarch Money, a subscription-based money manager app, is one of them. You may recall that Mary Ann wrote about their $4.8 million seed round in 2021.

The company shared via email that last week it saw “twice the number of users” since the news broke. After the story, Monarch executives got back to me to say that the normal sign-up rate jumped 10x and ended the day 20x higher.

I later heard from several other Mint competitors, including Copilot co-founder Andrés Ugarte, who told me that November 2 is the company’s “biggest day.” Like Monarch, Copilot, which we covered here and here in 2020, is a subscription-based personal finance tracker, and even from the first story, it follows Mint.

“We are now getting more than five times the number of users we see every day,” Ugarte said via email.

I covered Plenty’s pre-seed round in May, which provides a platform for couples to manage their finances. Emily Luk, co-founder and CEO, said via email that the startup interviewed hundreds of millennial couples who manage their finances online, and found that of the 90% who tried Mint, 10% only use it. Their reason? “Budgeting and reporting is too much for this stage of their life, or it takes a lot of work to keep up,” Luk said.

“Mint is part of the last generation of products that help people track and monitor their finances,” said Luk. “The next generation will help people actively manage their money.”

Many are still in waitlist mode; however, as a result of the news, the startup has added a dropdown item to its waiting list to measure whether new users who sign up are looking to replace Mint. If so, people will get early access and a way to import transaction history before Mint’s Jan. 1 shutdown.

Meanwhile, Origin had a well-timed launch on November 3. The startup claims it’s “the first personal finance platform that provides a holistic net worth tracker, AI-powered financial guidance, automated investing, easy tax filing, estate planning and the option to meet with a Certified Financial Planner.” It’s too early to tell if the Mint shutdown will affect user sign-ups, so hopefully I’ll be back with an update. — Christine

Weekly news

revolution, the UK-based fintech giant, has appointed a new CEO for its UK division. Francesca Carlesi will manage Revolut’s home country division, and Nik Storonsky remains CEO of Revolut Ltd. It’s worth noting that today’s news comes because Revolut still doesn’t have a UK banking license after years of back-and-forth with British regulators. The company is applying for a UK banking license in 2021. More here.

The unit, which raised $100 million at a $1.2 billion valuation, launched a white-label app, which it said allows software companies to embed banking and lending into their platform “with a You’re just a line of code.”

Klarna employees are set to go on strike next week in fintech country Sweden, it said tech.eu articles. But at the end of last week, the strike was called off. By email, Klarna CEO and co-founder Sebastian Siemiatkowski told TechCrunch on Friday that “after an intense week of negotiations,” the company reached an agreement to join the Banks Employer Organization in January. 1, 2024. More here.

As reported by Yahoo Finance, PayPal announced third-quarter earnings “that topped analyst estimates on the top and bottom lines. The fintech company reported adjusted earnings of $1.30 vs. to an estimate of $1.23. Revenue of $7.42 billion was better than expectations of $7.39 billion. The company’s shares “closed nearly 7% higher at $55.06 on Thursday as a strong full-year forecast of profit also calmed market concerns about a slowdown in spending,” as reported by Reuters. Interestingly, the company’s new CEO, Alex Chriss, said American Banker: “Our cost base is very high and it slows us down. The company’s focus is unclear. “

Neon Money Club last week became the first Black-owned tech company in the US to launch an American Express card: “According to information provided by AfroTech (and cited by Yahoo Finance), Neon Money Club — co-founded by Luke Bailey and Jackie Liao — has scored a partnership with American Express (Amex) ‘to launch a credit card that challenges the rules through its design and benefits, which include allowing users to invest reward points in the US stock market.’” Hear more from Bailey in this article by TC Dominic-Madori Davis here.

Some things we read:

Why this investment banker says bank M&A is poised to rebound in 2024

DigiSure has launched a new tool to prevent fraud on sharing platforms

Amazon unveiled a buy now, pay later option from Affirm for small business owners

TodayPay teams with Visa to strengthen ‘payments as a service’

Now you can start a fundraiser for any charity you want in seconds

Funds and M&A

As seen by TechCrunch

Charlie’s senior-focused banking has set up a new fund to stop fraud (The round came just six months after the company announced its seed round of funding, and launched. Since then, it has amassed “thousands of users,” according to its CEO.)

Payroll Integrations raises $20M to build employee financial health tools

Seen elsewhere

Atlanta insurance tech startup raises $10M

Preczn raises $6.8M to transform SaaS platforms with fintech operational features

Kasa Living raises $70M to expand property portfolio

Viably’s groundbreaking $50m financial boost for ecommerce wholesalers

ICYMI: Auquan raises $3.5M in seed funding to bring AI-powered insights to the financial services industry

Image Credits: Bryce Durbin

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