Welcome back to Exchange, where we take a look at the most important fintech news of the previous week. If you’d like to receive The Interchange straight to your inbox every Sunday, head over to here to sign up! We’re back and making up for lost time after Thanksgiving break. here we are!
Webull, Yieldstreet and NomuPay go shopping
Alex Wilhelm and I recently talked on the Equity Podcast about how M&A activity this year hasn’t really happened at the pace we expected. The year started strong, with a series of acquisitions taking place in this space. But then things slowed down considerably.
Well, I think I lived up to my words this week when we at TechCrunch reported on three different M&A deals.
Firstly, And he pees It announced that it has acquired Flink, a Mexican stock trading app. We’ve got you covered first Flink In 2021 when the company raised a $57 million Series B led by Lightspeed Venture Partners.
Flink launched its app in 2018 with the Wallet Service, a global digital and physical debit card powered by Mastercard, and in 2020, it began offering the ability to buy and sell fractional shares from 30 pesos, commission-free, of NYSE-listed stocks. As of August 2021, it has 1.6 million users. It is not known how many there are today.
At the time, he was a Lightspeed partner Mercedes is a girl She told TechCrunch that her company “fell in love” with Flink’s mission and its impact on the country’s “financial ecosystem.” She was also impressed by the company’s unique features, including allowing Mexican investors to access the U.S. stock market and invest fractions of shares.
It seems Lightspeed isn’t the only entity to fall in love with Flink. Anthony Denyer, president of the Americas and Europe at Webull, said the purchase represents his company’s expansion into the Latin American market. He added that Webull expects to use Mexico as a “stepping stone” to Latin America and greater South America, where it believes “there is a strong desire among retail investors to access global markets.”
You can hear the Equity podcast crew go more in-depth on this topic here:
It is important to note that this is not the only large fintech acquisition from Latin America by a US company this year. In late June, credit card giant Visa announced that it had acquired Brazilian payments infrastructure startup Pismo for $1 billion in cash in what is likely one of the largest fintech M&A deals to take place in 2023 so far.
Visa and Webull likely have a lot of startup options to consider when deciding to acquire Pismo and Flink, respectively. Visa in particular could have chosen a company located anywhere in the world. Both companies chose to acquire a Latin American company, which is no small feat.
As you can see, even though funding in the region has decreased, I remain optimistic about the region. I believe there are great opportunities for innovation in the region. The most interesting aspect of fintech to me is the ability to promote inclusion. It does that and more in Latin America.
As mentioned earlier, Webull’s acquisition of Flink wasn’t the only M&A deal this week.
I’ve also written about Al Aid StreetPlan rooms Staff, an online marketplace that connects accredited real estate investors with operators. This wasn’t a huge shock, as the deal had been rumored to be in the works for a few months. But interestingly, Cadre – which Joshua and Jared Kushner co-founded with Ryan Williams – has not been doing well. If true, this is just one example of a fintech company taking advantage of market conditions to grow in a specific region without having to reinvent the wheel. More about this deal here.
In Europe, TC’s Ingrid Lunden reported on Dublin, Ireland NomuPay – Acquisition of a payments startup that was formed from some of the healthier parts of the largely failed fintech company Wirecard Total processinga Manchester startup that creates payment processing solutions for functions such as recurring payments, risk management, PCI (data security) compliance, and payment integration.
Ingrid wrote that NomuPay pays about $35 million for total processing and says the company’s total value is now $135 million. More about that here.
– Mary Ann
Do you want to be the next Mint? You may want to rethink that strategy
When he senses Announce It will close the personal finance app Mint In January, this was an opportunity for competitors to grab a portion of Mint’s 3 million-plus users. However, one investor says companies shouldn’t try to be the next mint.
Shel Mohnot, co-founder and partner at Tomorrow’s better projects, chirp On X, “I’ve heard of a few people who have built a new version of @Mint Now that Intuit has shut it down. I do not recommend it if you want to build a large-scale business. There are not many people who want to manage their finances effectively; The startup graveyard is full of PFMs.
Yes, Mohnot is probably biased. He is, after all, an investor in the fund-tracking firm Albert. While speaking to me recently, Mohnot said years ago he looked at several concepts built with the goal of competing with Mint, including Albert.
“Seven or eight years ago, there were a large number of angel companies, all of them seed-funded, and some even raised a Series A,” Mohnot said. “However, none of them got anywhere with the PFM (personal finance management product). They all had to focus on something else to make it successful.
It’s widely said that most Americans would have a problem if an unexpected $400 bill showed up. So managing your money effectively – and a free product to boot – can be attractive. Except, as it turns out, that’s not the case.
Mohnot explained that Albert’s founders also had to change their strategy when they realized that people didn’t actually want to manage their own money. They want a solution to do it for them.
“AI manages their money, and there are a lot of people who want that,” Mohnot said. “They have hundreds of millions in revenue to show for it.”
Should companies try to be the next mint? A free product, like Mint, likely won’t lead to “enterprise-scale business,” according to Mohnot.
Like Albert, other companies are finding success with subscription-based funding tracking models. After Intuit’s announcement in early November, Monarch Money told me they saw a 20x increase in the number of users joining its platform. Meanwhile, the co-pilot told me they saw the numbers go up 5x. Mohnot referred to both Copilot and Monarch as “good products” and sees some additional promising models here.
“I’ve seen some interesting companies managing high-net-worth people’s money because people are willing to spend a lot,” Mohnot said. “You either have to get a broad audience with a low-cost product or go up to market and charge a lot of money. If you have this PFM product, it should be a suite of products.
Since then, other personal finance apps have reached out to me to tell me how their user base has grown in light of the Mint news:
- Eric Dunn, CEO of Quicken, said:Accelerate simplification It has seen the largest volume of user subscriptions since its launch in January 2020.
- Customers in financial router sequence It grew by 30%.
- Invoice organizer and budget platform Pocket Guard He said total registrations increased three-fold while total revenues jumped four-fold.
– Christine
Weekly news
Reporter Manish Singh writes about Warren Buffett Berkshire Hathaway Exit It is done, which ultimately resulted in a loss of 40%. Paytm is one of the largest mobile payment platforms in India and also provides access to loans and investments in mutual funds. Berkshire acquired a stake in Paytm five years ago. Since then, Paytm has become a publicly traded company, but its stock has not performed well. Read more.
“Buy now, pay later,” thought to be a good way to buy big-ticket items and pay off the cost in installments with little or no interest, has had its fair share of booms and busts over the past decade. Earlier this year, Mary Ann examined whether the concept had been implemented. However, BNPL companies say: “Not so fast,” and are working to breathe new life into the concept, and even expand it to other areas. Confirms, one of the pioneers of buy now, pay later, and among them. Christine spoke with Head of Product Vishal Kapoor to discuss how Affirm does this. Read the Q&A with Vishal.
Reporter Paul Sowers writes about Robin HoodThe start, stop and start path of opening up for business in the UK. This has been five years in the making, and those who signed up to the waiting list will finally get this access starting in 2024. Paul explains how it all happened. Read more.
Editor Sarah Perez got to the bottom of what’s going on with their credit card and savings account partnership Goldman Sachs And apple. The Wall Street Journal reported This week the deal was dead. While there have been various media reports and Another gossip Claiming that the relationship did not go according to plan, Apple told Sarah a different story. Read more.
Turning to TechCrunch+, Greg Weisman, co-founder and COO of the global payments infrastructure platform Mercurio, offers some advice on how B2B startups can go about their Series A in this challenging macro environment. Read more.
In general company news:
- Uruguay-based payments platform dLocal reported some positive third-quarter earnings, including a year-over-year revenue increase of approximately 50%, supported by strong activity in Brazil and Mexico as well as in Africa and Asia. The company also reached a record total payment volume of $4.6 billion in the third quarter, up 69% from the same quarter in 2022. Follow what’s happening with dLocal this year in Mary Ann’s story about its stock price soaring, the naming of a new co-CEO, and how it has rebounded The company after a short-selling attack.
- Financial technology giant Intuit reported first-quarter earnings This included increasing revenue to $3 billion, up 15% year over year. This was driven by strong performance among ProTax, consumer and small business groups. During the quarter, Credit Karma’s revenue declined slightly. In April, reporter Jagmeet Singh wrote about Intuit’s growing pains as it embraces artificial intelligence. Read more.
Other items we read:
Atlanta-based technology company Greenwood is launching a new investment platform
The banking watchdog has crowned its first female fintech CEO. His work history was a web of lies Jason Mikula took a deeper look at this Prashant Bhardwaj Biography.
Stripe’s new service allows companies to buy carbon removal projects early
Standard Chartered Bank has become Checkout.com’s banking partner in the MENA region
Bluevine says business screening pushes managed deposits to $1 billion
Finance, mergers and acquisitions
As seen on TechCrunch:
Candex received a $45 million injection to grow its procurement management business
Mosaic raises $20 million to build a solution to split payments for creators
FrontEdge raises $10 million in debt and equity from TLG and Flexport to facilitate trade for African exporters
Crezco aims to make integrating bill payment easier
Indy raises $44 million to simplify taxes and paperwork for freelancers
Seen elsewhere:
Peter Thiel-backed debt fund puts $30 million into Exectras
Fintech startup CapitalOS raises $9 million in equity and $30 million in debt
Enfuce raises €8.5 million in follow-on funding
Automated forensic accounting startup Valid8 Financial has closed in an $8.5 million funding round
Image credits: Bryce Durbin