Weekly update #31

Welcome to this edition of the weekly newsletter. The idea behind this activity is to gather all the information in the startup ecosystem in one place, with a special focus on the fintech market.

This week I’ve been reading two very interesting reports on the market. The first one is ”Status of Private Market - Q1 2024 Industry data addendum” by Carta . Not exactly a real study, but more a snapshot of a specific industry made with data. In this case, the overview is on private markets, analyzing investments made in startups divided by stage.

In this image you can clearly see the drop in valuations in the seed stage, with a specific snapshot of three industries: Healthcare, consumer and fintech. The takeaway here, is that the downturn in terms of valuations seems to have touched the bottom, and valuations are stable or even rising recently.

Coming to series A, don’t fool yourself with the last graph in the image: the spike you see there is mostly driven by specific rounds, and it’s not an overall trend. Even in series A the situation seems stable now, with no uptrend. the comparison between this period and Q2/Q4 2021 is astonishing.

Finally, in terms of round size, we can identify here the main problem of the private markets recently: the lack of liquidity. The average round size is still experiencing the last tail of the downturn, mostly because of the actual level of interest rates worldwide. But I am hopeful here, I believe we will probably see the first cut in interest rate at the beginning of Q3.

The second report I read was “Finch market pulse - May edition” by Finch Capital. The fintech focused fund is regularly releasing an update on the fintech market, taking in consideration different verticals inside this industry, highlighting market trends and investments.

The first snapshot from the report is about HR & Payroll vertical. In this case we saw an increase of 151% in funding, with some honourable mentions in terms of startups, like Cosmico in Italy and Alleo in the Netherlands, and also two exits. Revenue growth YoY was 14% in this case.

Second snapshot is process automation, with an increase of 25% from Q1 in terms of capital deployed. Here we saw Pactio in the Uk and Apify in the Czech Republic raising money, and three exits. 15% revenue growth YoY, and most interesting a 7x median multiple of the revenue in terms of valuations.

Here is the most interesting one. After at least two years of stagnation in terms of fundraising, excluding some big names, banking and wealth management is rising considerably, with a 171% increase from Q1. 16% growth in terms of revenue, and 5.89x of the revenue when coming to multiples.

I think this is a very interesting insight on a more sustainable industry. When deep diving into the numbers, I found some very interesting figures in terms of multiples, also comparing with last years and quarters. We can clearly see the push for sustainability and profitability, instead of growth. Here is the link to the full report, if you want to deep dive.

Before jumping to the latest news, a quick request from my side. I will start a small series of podcasts to interview fintech founders and VC managers active in the ecosystem. If you want to be part of it, feel free to drop me a line on Linkedin!

Anyway we saw some very interesting news in the market this week. Elon Musk’s xAI finally announced the $6 billion fundrise everyone was talking about. In the fintech market, Nubank released not one but two new features, expanding into travel and telco, while in Europe N26 is finally free to onboard new customers in Germany after Bafin lifted the limit imposed. Mastercard unveiled crypto credentials, while the collapse of Synapse could potentially affect 10 million users. In the VC ecosystem, we saw Peter Thiel raising $300 million for Valar Ventures LLC, Avendus looking for $350 million to invest in early stage indian startups, and Rialto Ventures raising $55 million in Italy. Talking about Italy, Zefi.ai raised $1.6 million and Revolv Space secured $2.5 million in a round led by Primo Ventures . Finally, rounds closed by some very interesting fintech startups like Swiipr , Félix , Relay , ZTLment , Solutions by Text, Doconomy , Viable , El Dorado and many others.

But let's take a closer look at the main news of the last seven days:

Closed deals

• Colombian fintech El Dorado raises $3 million and aim for a 900% revenue growth in 2024
• UK based Viable secures $2.8 million to transform finance for online and multichannel merchant
• SilverRock Bank secures a banking authorization after a $50 million funding to revolutionize non banking lending
• Berlin based Rows.com raises $8 million to spread AI based spreadsheets
• ExcelCredit launches a first social bond to raise $26 million in Colombia
• Saudi fintech HALA raises new capital from private equity giant TPG
• Swiipr secures $6 million to disrupt how airlines manage payments worldwide
• Félix raises $15.5 million to help Latino customers send money via WhatsApp
• Crypto startup WeatherXM raises a $7.7 million series A to merge crypto and weather forecasting
• Climate fintech Deedster raises SEK50 million to drive climate action
• Toronto based Relay raises $32.2 million to help SMEs manage their cash flow
• Copenhagen based ZTLment raises $2.4 million to replace outdated banking infrastructure
• Romanian startup FintechOS raises a $60 million series B round!
• Spanish startup Backtrack secures a $2 million seed round
• #Slingshot raises $2.2 million to provide financial services to artists and creators
• Coinflow Labs secures a $2.25 million seed round
• Solutions by Text bootstrapped for over a decade, and now raised $110 million
• Doconomy raises a $34 million series B to boost climate action in banking
• Old Well Labs secures a $36 million series A to revolutionize Investment Management
• #Forward raises $16 million to take on Stripe as leader in payment integration

Insights on the VC industry

• Peter Thiel-founded Valar Ventures LLC raises $300 million for his latest fund
• Indian based Avendus is looking to raise $350 million to invest in Indian early stage startup
• ​​Italian VC  Rialto Ventures emerges with a $55 million fund and already 8 investments in deeptech

News on the market

• Now it's official. Elon Musk's xAI raises $6 billion in a funding round, backed by Andreessen Horowitz and Sequoia Capital
• Synapse collapse could impact hundred of fintechs and over 10 million users out there
• Walmart partnership with Capital One on credit card could potentially ends up in a lawsuit
• Starling Bank could reach a $10 billion valuation thanks to its engine SaaS platform
• Breaking news from Germany: N26 announces that the new customer limit imposed by Bafin has finally been lifted!
• Koywe acquires Chilean fintech Facto Investments to enter the North American market
• Temenos partners with ZainCash to boost digital payments in Iraq
• PayPal will venture into advertising with the launch of a new platform
• French super app LumApps has sold a majority stake to Bridgepoint for $650 million
• Nubank enters the mobile network market with eSIM services
• Mastercard unveils crypto credentials with a first peer-to-peer pilot transactions
• Turkey based fintech Papara acquires the Pakistan fintech SadaPay to expands in the Middle East
• Nigerian fintech Brass has been acquired by a consortium led by Paystack
• Nubank launches NuViagens, a travel booking platform for high income travelers

A special look in the Italian market

• Italian startup Zefi.ai raises $1.6 million to analyze how SMEs interact with users
• Another very interesting italian startup! Revolv Space secures $2.6 million led by Primo Ventures
• Nexi Group launches Tap-to-pay on iPhone for italian merchants!

Startups raising funds

• Fantalegends - a Fantasy Football free-to-play mobile game that aims to provide an enjoyable and safe experience, user-centered, with more than 2k daily active users. Raising $1M.
• PopulaRise - The platform that allows companies of every dimension to promote themselves on social media through the collaboration with their clients. B2B2C SaaS. Raising $1M.
• Bitcoin People - Fintech company focused on crypto payments between corporate and cross countries. B2B, SaaS. Raising $500k. Round closed!
• Tutornow - Edtech that provides an online tutoring platform for students with learning disorders. Raising $500k to $1M.
• Recivu - Fintech  startup trying to digitise the receipt flow by getting rid of papers. Looking for $150k in SAFE, already $50k committed.
• Weagle - B2B Tech startup that provides the very first browser designed for company, with total security for sensitive data. Raising $6 millions for their seed round.
• Reach Finance - Reach is the fintech platform for wealth accumulation for the Y&Z generations, they provide users with the tools to build wealth such as a budget tracker, a financial plan and a systematisation of investments. Looking for $700k, with already $500k committed.
• wrapp.ai - A fintech startups that offers a virtual accountant and CFO that can help SMEs scale globally. Looking for $1 million, $750k already granted from public funds, looking to close the last $350k.

If you are a startup and want to be present in this list, please contact me directly.

If you are an angel investor or a VC interested in those companies, contact me for an intro!

Take also a look at the last edition of the newsletter, Weekly update #30