Weekly update #46

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

This week I released the first episode of a weekly series of interviews called “Builders”. The idea here is to speak with great fintech founders, VC managers and main players in the startup ecosystem to explore what people are building out there.

The first episode is a conversation with Noam Inbar, partner at Viola FinTech, Israel based VC with a focus on the fintech market. It was a wonderful conversation, revolving around the new trends in fintech, the concept of contextual finance and the VC industry. If you want to take a look you can find the video here on Youtube, or the podcast here on Spotify or here on ApplePodcast.

If you are a VC manager, an investor or a fintech founder and want to be part of the next episode feel free to drop me a message on Linkedin, always happy to talk!

Coming back to us, I’ve been reading a very interesting report from KPMG this week, about the status of the fintech market in H1 2024, called “Pulse of Fintech H1’2024 - Global analysis of fintech funding”. No surprise, the situation is not good. Here my main takeaways:

Global investment in fintech, spanning venture capital, private equity, and M&A, declined from $62.3 billion across 2,287 deals in the second half of 2023 to $51.8 billion across 2,254 deals in the first half of 2024. This downturn was seen across all major regions: in the Americas, investment decreased from $38.6 billion to $36.8 billion; in Europe, the Middle East, and Africa (EMEA), it fell from $19.1 billion to $11.4 billion; and in the Asia Pacific (ASPAC) region, it dropped from $4.6 billion to $3.6 billion.

Globally, there were only five fintech deals exceeding $1 billion in the first half of 2024, all of which were buyouts. Four of these deals occurred in the Americas, including Worldpay ($12.5 billion) and EngageSmart ($4 billion) in the US, and Nuvei ($6.3 billion) and Plusgrade ($1 billion) in Canada. The UK accounted for the fifth deal, a $4 billion buyout of IRIS Software Group. The UK also saw the largest fintech-focused venture capital deal of the first half of 2024, with Abound raising $999 million.

Global fintech deal volume remained relatively stable at 2,254 in the first half of 2024. Both the Americas and the Asia Pacific (ASPAC) region experienced an increase in deal volume, rising from 1,066 to 1,123 in the Americas and from 406 to 437 in ASPAC between the second half of 2023 and the first half of 2024. Meanwhile, the Europe, Middle East, and Africa (EMEA) region saw a decline in deal volume, dropping from 804 to 689 deals.

Finally, a couple of main trends to look at in the upcoming quarter. Within the payments sector, there was increasing interest in companies with specific use-case applications, including startups aimed at adding value in niche areas of financial services, such as payments insurance, unsecured lending, and insurance claims. Long term, DORA regulation will surely have a huge impact on the financial sector, with the EU’s Digital Operations and Resilience Act set to take effect in early 2025, AI-driven cybersecurity solutions are expected to attract the most attention and investment.

Anyway we saw some very interesting news in the market this week. Revolut landed in Colombia, while they integrated with Bizum in Spain. UniCredit seems to be in talks to acquire Commerzbank AG, TrueLayer strikes a partnership with Stripe, and Nubank ceases its crypto project, Nucoin. A lot of movements in the VC industry, Atomico definitely breaking the news with a new $1.24 billion fund, then we saw LIFFT closing a $100 million fund, Wischoff Ventures closing a $50 million fund, Outward VC raising $51 million to invest in fintech, but also MCJ , Slauson & Co. , Alpha Partners, AENU. In the Italian ecosystem, Bending Spoons made headlines when they announced they wanted to lay off 75% of the workforce at WeTransfer. Finally, some very interesting funding rounds from fintech startups like Cobre, Ábaco, finally, Twenty7tec, PastPay, Paymob, Novatus Global, FlapKap and many others.

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

Closed deals

• Colombian fintech Cobre secures $13 million to boost payment management in LATAM
• El Salvador based fintech Ábaco closes a $4 million pre-seed round
• US fintech Unlock Technologies raises a $30 million series B round
• Form3 raises a $60 million series C extension to boost A2A payments in UK
• Regtech MirrorWeb raises $63 million in growth funding round
• Miami based fintech finally secures a $200 million round for its ai bookkeeping solution
• The Bank of London secures a £42 million oversubscribed funding round
• Mortgages focus fintech Twenty7tec secures a $16.5 million funding round
• Egyptian fintech Paymob raises $22 million in series B extension
• B2B BNPL startup PastPay closes a $12 million series A round
• Payment app LineLeap recently secured a $10 million round to let people pay to skip the line at bars
• AI-powered risk management startup Datricks raises a $15 million round
• Novatus Global, regtech company that helps financial institutions navigate global regulations, raises a $40 million series A round
• Versana raises a $26 million funding round with Barclays joining
• MENA based FlapKap secures a $34 million pre-series A round
• Pliant strikes a partnership with Volksbanken Raiffeisenbanken to refinance their credit capacity up to $200 million
• Global fintech startup IN1 App raises a $6 million pre-seed to innovate financial management across crypto and fiat
• Huma Finance raises a $38 million series A to invest in its payment financing network
• FlexiLoans, Indian digital lender, raises $34.5 million in latest series C

Insights on the VC industry

• LIFTT and European Investment Bank (EIB) launch a $100 million fund to boost innovation in Europe
• London based VC Outward VC raises a second $51 million fund to invest in fintech
• Slauson & Co. closes a second fund at $100 million to invest in early stage and economic inclusion
• Fintactics Ventures partners with Ethos Invest and Arbah Capital to invest in early stage B2B fintech startups
• London based VC Atomico just raised a new $1.24 billion fund
• MCJ raises a second fund at $80.6 million to invest in climate tech startups
• Wischoff Ventures closes a third fund at $50 million
• Belgium based VIVES Funds raises a new $75 million fund to invest in European startups
• Climate tech VC AENU closes a new $170 million fund
• Alpha Partners raises a $153 million third fund to invest alongside early stage VC

News on the market

• Mastercard and barq strike a partnership to boost digital payments in Saudi
• It seems that PE firm TPG is in talks to acquire a stake in Vinted at a $5 billion valuation
• Mario Draghi calls for a new Marshall plan in Europe
• TrueLayer expands partnership with Stripe to offer pay by bank in the UK
• Global Payments Inc. acquires Yazara to enhance SoftPOS solutions
• A news that many operators in the market were waiting for: European Central Bank cuts interest rates by 25 basis points
• Nubank, the Brazilian giant of neobank, will cease operations for its cryptocurrency, Nucoin
• Swift is increasing its efforts to build a CBDC and tokenized assets exchange
• Progress acquires data management platform ShareFile for $875 million
• Italy's UniCredit rumored to be in talks with Germany's Commerzbank AG for a potential acquisition, just days after acquiring a new stake in the German bank
• Mastercard acquires cybersecurity company Recorded Future for $2.65 billion
• Klarna partners with UATP to target the $1 trillion travel industry
• Only in the last week, Revolut integrated Bizum in Spain, landed in Colombia and confirmed the $45 billion valuation in shares sale

A special look in the Italian market

• After the acquisition of WeTransfer, Bending Spoons is laying off 75% of the workforce. And I don't really get why everyone is so surprised.

And here some useful resources for everyone involved in the ecosystem:

Events you don’t want to miss

• Italian Tech Week | Turin - 25-27.09.2024 (Link to the invite or website)
• Newport investor summit | Newport (RI) - 26-27.09.2024 (link to the invite or website)
• Bits & Pretzels founders festival | Munich 29.09-01.10.2024 (Link to the invite or website)
• Milan Fintech Summit | Milan - 08-09.10.2024 (Link to the invite or website)
• VDS+ | Valencia 23-24.10.2024 (Link to the invite or website)

You have a cool event you want to mention or to sponsor? Feel free to send me a DM.

Startups raising funds

• Loyyal - Loyalty platform from the MENA region, with entities in the US and South East Asia, provides a B2B2C platform to handle multiple loyalty programs and earn rewards all over the world. Raising a $6M Series A
• Freedhome - Proptech and fintech platform, enabling people to be able to gain profit from real estate by renting them to intermediaries. Raising a $1M seed round

• 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.
• Tutornow - Edtech that provides an online tutoring platform for students with learning disorders. Raising $500k to $1M.
• Recivu - Fintech  startup trying to digitize 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 systematization 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.
• Shoppy Code:Gift card platform that offers a points based loyalty program. They share part of the profits coming from marketing budgets with their customers. Raising $500k.

Take also a look at the last edition of the newsletter, Weekly update #45