Fintech startup TreasurySpring raises $10M for platform giving online access to Fixed-term-funds

Fixed-term-funds (FTFs) have historically been a bank-to-bank market. FTF products allow for investing into some of the safest assets including, UK Government bonds, US Government bonds and highly-rated corporations. They allow holders of large amounts of cash (such as charities, private funds, family offices etc) to reduce and diversify their risk, but also increasing returns.

TreasurySpring is a fintech startup that is aiming to opening up access to this area of financial markets, by creating a Fixed-Term Fund platform. It’s now raised a $10 million Series A investment round co-led by MMC Ventures and Anthemis Group. Existing investors, including ETFS Capital, participated, taking the total its raised to $15 million.

TreasurySpring says its FTF platform gives holders of large cash balances online access to a menu of proprietary cash investments on a daily basis. This gives them access to an asset class that is usually only available to major financial institutions.

Founded in 2016 by Kevin Cook (CEO), Matthew Longhurst and James Skillen, Cook said in a statement: “Following a break-out 12 months in which we increased AUM by 10x, we wanted to bring in the best possible investment partners to support our ambitious growth plans. We have long admired both Anthemis Group and MMC, so I am delighted that they co-led the round and we are excited to work with Sean, Ollie and their respective teams, as we move into the next phase of our journey to redefine cash investment and front-office treasury.”

Given the current low and negative interest rates and an uncertain global financial outlook, TreasurySpring says its platform is likely to appeal as an alternative to traditional bank deposits and money market funds. It says it’s now issued more than $9B of FTFs to a client base which includes FTSE 100 and other listed companies, fund managers, large private companies, charities, and family offices.

Yann Ranchere, partner at Anthemis Group said: “With its ambitious and mission-driven team, TreaurySpring is opening the traditional money market industry to a whole new pool of participants.”

Oliver Richards, partner at MMC Ventures added: “Having worked with the team at TreasurySpring for the last two years, we have absolute confidence in their ability to deliver on their unique vision to level the playing field in cash investing and short-term funding, through a platform that not only brings value to its clients and issuers but also enhances the diversification and systemic stability of the money markets as a whole.”

Does TreasurySpring have any direct competitors? The compay sdays not. That said, bank deposits and money market funds are still the only tools available to most holders of large cash balances, so the banks and asset managers that offer these products are competitors, “to an extent” admits the firm. Howeverr, they are also “collaborators in many instances.”

Cook said: “Adoption of the platform is being driven by a realisation that the risks and returns of the traditional [deposit and MMF] options are becoming ever less attractive, whilst building out the infrastructure to do anything else is complex, cumbersome, time consuming and expensive.”

#bank, #bond, #ceo, #economy, #europe, #finance, #fintech-startup, #investment, #mmc-ventures, #money, #ollie, #partner, #tc, #uk-government, #us-government

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LatAm corporate spend-management startup Clara raises $3.5M, comes out of stealth

This morning Clara, a corporate spend-management startup focused on the Latin American market, announced its product launch and a $3.5 million pre-seed round led by General Catalyst.

The company’s funding caught TechCrunch’s eye as there has been a flurry of funding for related companies serving the United States market. From Divvy to Brex to Ramp to Airbase to Teampay, investors have poured capital into startups working to help companies better track and manage their spend.

Companies working in the fintech niche tend to monetize in one of two ways, namely interchange revenues and software incomes. Or more simply, some in the corporate spend category generate revenues when users swipe cards, earning a slice of the transaction. And some also charge for the software that they have wrapped around their cards and other methods of payment.

Clara is in the first camp, making its revenues today from interchange incomes, according to Gerry Giacomán Colyer and Diego Iván García Escobedo, the company’s co-founders. Colyer is the company’s CEO, while García Escobedo heads its product and tech work.

The pair told TechCrunch that the Mexican interchange market is more akin to the United States’ own (lucrative) than Europe’s own (less lucrative), meaning that if the company can sign up a host of customers for its free service — empieza hoy – sin costo, its website intones — it could post the same sort of revenue growth that has spurred some of its American comps to huge venture capital raises.

The startup’s potential has caught the eye of more than General Catalyst, a well-known venture capital firm. The two co-founders of Ramp are also investors in Clara. The startup’s round also included funds from a host of smaller firms and angels, including Canary Ventures, Adapt Ventures and Picus Capital, among others.

The co-founders want to bridge the gap in technology-enabled financial services that they found in Mexico. Colyer worked for G2 after a stint at Stanford, eventually moving back to Mexico and working on a micromobility startup called Uva Scooters. He discovered during the process that Mexican and other Latin American firms lacked some digital tools, like low- and zero-cost corporate spend software, to which American companies had ample access.

So, the pair of founders, who met at Grin Scooters, which had acquired Uva, set out to build Clara, tuning a model with proven success in America to work in Mexico. What sort of tweaking was needed? Local compliance to ensure high-levels of card acceptance, support for local tax law and receipt management, the pair said.

Thus far the company has only worked with around 100 customers, with the co-founders telling TechCrunch they have seen traction with high-growth companies, some of which are startups. That echoes what Brex tapped into when it was a more youthful upstart itself.

Today the company operates in Mexico only, but intends to support other markets over time.

Regarding the company’s $3.5 million raise, like many pre-seed and seed deals, the funds were acquired in a few tranches, including one in May of 2020. The rest of the capital came later in the year.

Seeing successful startup models that are familiar in the United States pop up in Latin America is a regular trend. Belvo, for example, is following in the tracks that Plaid laid down, bringing fintech APIs to the LatAm market. Given rising smartphone penetration, and rising card usage, perhaps Clara will find a good fit in its home market.

Looking ahead, TechCrunch is curious how quickly Clara can accrete new customer companies now that it has formally launched. If it can, and the interchange game proves successful, expect to hear from it again soon.

#clara, #fintech-startup, #general-catalyst, #latam, #recent-funding, #startups

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Minu, a Mexico City-based, pay-on-demand startup, lands a $14M Series A

Many of the startups raising capital in Mexico are focused on financial inclusion, aiming to level the playing field in a country that is largely unbanked and has a burgeoning middle class.

One such company, minu, a Mexico City-based, pay-on-demand startup, announced Wednesday that it has raised $14 million in a Series A round of funding led by FinTech Collective.

New investors VEF, XYZ Ventures, and FJ Labs, as well as DocuSign founder Tom Gonser and Gusto CFO Mike Dinsdale also participated in the financing. Existing backers QED, Next Billion Ventures, and Village Global also put more money in the company. 

The financing — which included $2.5 million in debt from Banco Sabadell Mexico — brings minu’s total raised since its 2019 inception to a total of $20 million. 

Co-founders Nima Pourshasb, Rafa Niell, and Paolo Rizzi were driven to build out a pay on demand offering in Mexico.

“We really think the lack of financial health is one of the key drivers slowing the potential and productivity of Mexican society,” Pourshasb said.

Minu aims to solve the employee liquidity gap between paychecks in an effort to help people see reduced financial stress and avoid expensive loans. The company offers 24×7 instant access to employees’ earned wages for a $2 fixed withdrawal fee.

Today, minu has over 100 large enterprise clients including TotalPlay, Telefonica, Scotiabank, OfficeMax, Rappi, Adecco, Manpower, Cap Gemini, and public sector clients such as the Electoral Institute of the State of Mexico. It saw its transaction volume and revenue grow by 18 times in 2020, albeit from a small base. The company declined to reveal hard revenue figures.

Minu operates under the premise that the liquidity gap is profound in Mexican society. An estimated 70% of workers live from paycheck to paycheck with average wages of $550/month, noted Pourshasb. And only 37% of Mexicans over 15 years old have a bank account, according to recent World Bank stats.

“Some people are continuously getting loans — at very high interest rates —  to cover recurring expenses such as food and transport,” Pourshasb said.

Minu’s first product offers instant, 24-7 access to earned wages.

“This is money that is already earned,” Pourshasb said. “Our users have an app to see how much is available and if they need those funds, they can instantly receive them.” 

The company’s distribution model is B2B so it works alongside large enterprises to offer access to the wages as a benefit for employees. Businesses are attracted to that model, Pourshasb explained, because they don’t have to pay for it or change their payroll process.

“We integrate with payroll so the process is automated and there’s no added work for them,” he added. “It also doesn’t affect cash flows. These are upfront funds so if someone withdraws money, it gets deducted from payroll.”

Some employers do subsidize the cost of the transaction fee for employees.

Looking ahead, minu says it will use its fresh capital to boost its headcount of 60 as well as expanding its offering to include financial education, savings, smart spend and insurance products. The company also plans to expand outside of Mexico.

Carlos Alonso Torras, who leads Latin America investing for New York-based FinTech Collective, believes that minu leverages “a strong combination of an exceptional founding team and auspicious macro trends.”

“We see the company’s current product as the basis for a platform that will offer an array of necessary financial products to a very underserved demographic,” he wrote via email. “Minu is already creating a moat vis a vis competitors via deep integrations, high client satisfaction and a broadening financial wellness offering. As the early mover in a market whose characteristics are conducive to the success of pay on demand, the immediate growth potential is remarkable, and Minu is uniquely positioned to excel.”

The investment marks the firm’s fifth in Mexico. Overall, FinTech Collective says it seeks and backs entrepreneurs “who are rewiring how money flows through the world.”

“Due to COVID, we are seeing a pandemic stricken world where hundreds of millions of people are facing greater financial instability, and we believe that fintech has a vital role to play in accelerating the emergence of a spending middle class underserved by traditional financial systems,” Torras added. 

Fintechs in Mexico have been busy. Last week, Stori raised a $32.5 million Series B round with the goal of “becoming Mexico’s leading credit card issuer for the rising middle class.”

Also in February, Flink raised $12 million in a Series A led by Silicon Valley-based venture capital firm Accel.

 

#banco-sabadell, #finance, #financial-inclusion, #financial-technology, #fintech-startup, #fj-labs, #funding, #fundings-exits, #latin-america, #mexico, #mexico-city, #payroll, #recent-funding, #startups, #tc, #venture-capital, #village-global, #xyz-ventures

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TreeCard raises $5.1M seed to plant trees as you spend

TreeCard, a U.K. yet-to-launch fintech offering a spending card made out of wood and the promise to fund reforesting via the interchange fees generated, has raised $5.1 million in seed funding. The round is led by EQT Ventures, with participation from Seedcamp and Episode 1.

Angel investors also backing the startup include Matt Robinson (founder of GoCardless), Paul Forester (founder of Indeed) and Charlie Delingpole (founder of ComplyAdvantage). TreeCard says the funding will be used to hire talent, support the roll-out of its product across the U.K. and to expand into the U.S. and “key European markets”.

Aiming to become a “leading green finance brand”, TreeCard was founded in August 2020 by Thiel fellow Jamie Cox (who previously co-founded Cashew), Gary Wu and James Dugan. The team hit onto the idea of swapping loyalty points or cash back for tree planting, in a bid to create a fintech proposition with more societal impact.

Once signed up, you link the TreeCard app to your current bank accounts so you can begin routing your spending through the Mastercard-powered TreeCard. Purchases you then make — or, specifically, a portion of the card transaction fees your spending generates — is then put toward tree planting projects run by green search engine Ecosia, which is also a pre-seed investor in TreeCard.

“[At a] high level, the climate crisis is the biggest existential risk that humanity has faced in the last 200,000 years; we believe directing the flow of consumer finances is the most powerful way to affect change,” CEO Cox tells me. “We’re building a finance company that allows consumers to not just to do less damage with their spending, but to actively improve the world.

“We are building a free spending card that allows consumers to spend more responsibly. The card uses interchange to reforest as they spend and sophisticated analytics to help them identify healthy spending as well as destructive ones”.

Of course, consumer card interchange fees in the U.K./EU are very low compared to the U.S. Offering a spending card and account isn’t without overhead, so it isn’t clear how sustainable TreeCard could be on interchange revenue alone. Perhaps unsurprisingly, the U.S., where generated fees are higher, is seen as a key launch market for the startup.

“Interchange fees in the U.S. are significantly higher than in the EU so this presents a sufficient revenue opportunity for us to perform our reforestation investments and cover marketing and management costs,” explains Cox. “In the EU we’re going to be partnering with an existing retail bank who will provide all our banking infrastructure for free. This will mean that, even though our interchange fee cut is lower, it will be sufficient to cover our costs in the EU. We will announce the name of the bank shortly”.

Meanwhile, early backer Ecosia is described by the TreeCard founder as its “mother” company. “They’re our closest partner and we’ll be working very closely with them as we grow,” Cox says. “They invested the first cheque into the company and will be doing all our tree planting for us. Ecosia’s marketing team is extremely experienced and they will be helping us use their search engine as a core channel for user acquisition over the next few years”.

Comments Tom Mendoza, deal partner at EQT Ventures: “TreeCard has the potential to become a leading green finance brand, going where no brand has gone before in creating a de facto platform for impactful financial management. At EQT Ventures, we’re increasingly aware of the environment and the impact that our investments have on the world around us, so we’re really excited to support the TreeCard team, who are actively working with the financial system to create a better future for the planet”.

#ecosia, #eqt-ventures, #europe, #fintech-startup, #fundings-exits, #recent-funding, #startups, #tc, #treecard

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After pausing the business, Fronted finally launches to offer loans to cover rent deposits

Fronted, the London-based fintech aiming to make life easier for renters, including lending the cash needed for a deposit, has finally launched.

In March, its founders took the decision to “hibernate” the nascent business after the first lockdown and with the pandemic taking hold. But, now with regulatory approval from the FCA and rents falling in London, the startup is officially opening.

“We had a lot of great momentum and then when lockdown came it was like getting headshot from across the map,” Fronted co-founder and CEO Jamie Campbell tells me. “It was when we heard that people weren’t able to move [that] we knew it would be impossible to find early testers for the product and that is when we decided to look at different options. We knew lockdown would delay launching and the furlough scheme gave us options and time. In the end, it was an easy decision and, looking back, it was the right one”.

Founded by Campbell, Simon Vans-Colina and Anthony Mann — former employees at Bud, Monzo and Apple, respectively — and backed by Passion Capital, Fronted is using open banking and other financial technology to offer a credit product designed to finance deposits directly. The pitch is that Fronted can lend more cheaply than existing options, such as credit cards, pay-day lenders and overdrafts, or insurance-backed membership schemes. And, crucially, at lower risk.

“Renting sucks — anyone who rents knows it,” Campbell told me last year. “There are so many problems to solve and we intend to tackle them all bit by bit. But first, we are going to pay people’s rent deposits for them so they can pay us back in bite-size manageable amounts”.

To be able to apply for a Fronted rental deposit loan, you’ll need to be U.K. citizen, have a bank account with more than six months of transaction data and minimum income of £12,000. You are then asked to securely link your bank account data to Fronted via open banking, in order to assess your affordability beyond a simple credit score.

“We believe [this] is a fairer way to determine whether or not someone qualifies for a deposit from us,” explains Campbell. “We are confident we are launching with a fair approach. We don’t, for instance, turn people away who are on benefits or furloughed”.

Fronted loans last 12 months and carry a 12.5% interest rate. However, there are no early repayment fees. Once a loan is agreed, the startup sends the money directly to the estate agent to be placed in the U.K.’s Deposit Protection Scheme, meaning that the loan never touches the renter’s hands (or wallet).

Meanwhile, the timing looks good. Fronted says that 60% of all renters have no savings and are therefore not in a great position to move. Meanwhile, rents are falling as much as 12% in London, meaning that renters could save huge amounts of money simply by moving.

“Deposits are a huge impediment to social mobility; the amount of people who don’t move because they don’t have the money on hand is staggering,” adds the Fronted CEO, noting customers don’t just include those that have already found a place, but also those who are still looking.

“People who haven’t found a place, they are coming to us to see what deposit they could get and then going to find a property… For those people, we give them a maximum which is valid for 30 days so they can shop around knowing they have Fronted in their back pocket”.

#europe, #finance, #fintech-startup, #fronted, #startups, #tc

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YC-backed Djamo is building a financial super app for consumers in Francophone Africa

Djamo, a financial super app for consumers in Francophone Africa, is the first startup from Ivory Coast to get backing from Y Combinator.

While there has been a huge profusion of financial services that have emerged in recent years in Africa, Djamo’s mission is to try to plug one specific and a very underserved gap in Francophone Africa.

In the region, less than 25% of adults have bank accounts as the focus for banks remains the top 10-20% wealthiest customers. The rest, which is a huge segment of the market of about 120 million people, is not perceived as profitable. But as banks slacked, mobile money from the region’s telcos filled in the gap. In the last 10 years, their wallets have reached more than 60% of the population — proof of how many millions of French-speaking natives were hungry for financial services. Today, this mobile money infrastructure and reach allows startups to build upon their existing payment infrastructure to democratize access through different applications.

Djamo is one of such companies taking advantage of this opportunity to bring affordable and seamless banking to the region.

In 2019, Hassan Bourgi, a second-time founder, returned to Ivory Coast after exiting his Latin American-based startup, Busportal, to Naspers-company redBus. There he met Régis Bamba who was still working at MTN, one of Africa’s largest telcos, leading several mobile money projects.

Frustrated by the unpleasant banking experiences they and many millennials faced in the country, Bourgi and Bamba launched Djamo last year to challenge the banking industry status quo. 

“Banking services are really difficult to access here, and we saw that as a huge opportunity,”  Djamo CEO Bourgi said to TechCrunch. “Since day one, we wanted to design a mobile-first platform that could break into the masses and our combined experience building mass-market consumer products was very critical to launching Djamo.”

According to Bourgi, the country’s millennials are trying to create relations with technology companies and be served differently from the norm. So, Djamo is providing this audience with a better front end experience and faster customer service.

Image Credits: Djamo

Rather than offering a one-size-fits-all approach, they focused on accommodating multiple layers tailored to different user needs. Whether it’s affording Ivorians the luxury to pay for online services like Amazon, Alibaba, or Netflix, or providing VISA debit cards in a timely fashion, these tailored approaches have made Djamo grow organically via word of mouth.

And why not? Before Djamo came along, the CEO says people would need to go to their bank branches and stay in long queues to get their cards or even load them with credit. Djamo relieves that stress and even allows customers to use their cards with zero fees in a wide range of services.

“For us, it was important to offer a zero-fee card with no recurring fee to a certain limit. After that, you pay as you go in transaction fees. There is a premium plan around $4 a month where users can transact to higher limits,” said Bourgi.

Today, Djamo claims to have around 90,000 registered users and processes over 50,000 transactions monthly. However, to get to this point, the company has ridden on sheer resourcefulness around its operations.  

Unlike Nigeria, where there are established payment infrastructure players like Flutterwave and Paystack, Ivory Coast doesn’t have such household names.

 “We have a couple of providers, but most are unreliable. But this doesn’t matter to the end-user, you have to make it work somehow,” said Bambi, the company’s CPO and CTO.

Lacking better options, Djamo switches from one provider to another to keep operations running. The year-old startup has also faced scepticism issues, common with most African fintech startups when they first launch. In Djamo’s case though, the founders had to go at lengths to prove to banks and customers that the platform was safe to use for onboarding, KYC and transactions.

Hassan Bourgi (CEO) and Régis Bamba (CTO & CPO)

Onboarding customers also came with its own set of problems: the delivery of Djamo VISA cards. Bourgi says unlike more developed countries on the continent, it is a Herculean task to access efficient delivery and logistics services in Ivory Coast. So, the startup built a delivery app with in-house delivery agents for this particular purpose. “The objective for our customers is that after registering with us, they get their cards the next day in a timely fashion,” Bourgi added.

But even before pushing out its MVP, Djamo had already received monetary validation for its product. In June 2019, it raised a pre-seed investment of $350,000 from private investors — arguably the largest round at this stage in the Francophone region. The ingenuity of the solution, at least to French-speaking Africa, and the founders’ track record was crucial to Djamo closing the round, Hassan explained.

For a long time, Francophone Africa has been underrated by international investors despite signs pointing to the emergence of a budding startup scene. Part of this has to do with language barriers and the region’s GDP and income per capita where English-speaking countries, excluding South Africa, contribute to 47% of sub-Saharan Africa’s average GDP, while French-speaking countries boast of only 19%.

However, with the World Bank stating that the region will have 62.5% of Africa’s fastest-growing economies by 2021, there’s bullishness around its growth in the coming years. 

With so many untapped opportunities, underrepresented regions like Francophone Africa are ripe for disruption. Investors know this and though their checks are still skewed towards Anglophone Africa, million-dollar raises from Senegalese energy startup, Oolu and Cameroonian healthtech startup, Healthlane in 2020 show their keenness on the market.

Like Djamo, both startups are YC-backed and are the other Francophone startups to have made it into the accelerator. But with this Winter 2021 batch, Djamo becomes the first fintech startup from the region. Following Healthlane’s acceptance in 2020, it is also the first time French-speaking Africa has had representatives for consecutive years.

To the founders, YC’s backing validates Djamo’s premise that financial service distribution across the Francophone Africa region is fundamentally changing towards applications.

“In Ivory Coast, people always say that the banking industry is too complex and we can’t do anything about it. But we saw it as a huge opportunity and a great industry to take on. Everywhere you see frustration, customers in pain, there is an opportunity for a business to come and do it better,” said Régis.

After participating in the three-month-long program which culminates in a Demo Day on March 23rd, Djamo will also take part in Visa’s Fintech Fast Track Program, an avenue for the company to leverage the fintech giant’s network to introduce new payment experiences.

#africa, #finance, #fintech-startup, #oolu, #payments, #startups

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Alexa von Tobel: Eliminating risk is the key to building a startup during an economic downturn

Launching a company, even in the best of times, is one of the most challenging exercises a person can go through. In an economic recession, it can seem downright impossible. But founders across the country, and indeed across the globe, are in the midst of that process as I write.

They aren’t the first. Alexa von Tobel, founder of LearnVest and founding partner at Inspired Capital, publicly launched her fintech startup in 2009, and founded it in May of 2007. In that span of time, Lehman Brothers went under — in December of 2008.

The company was launched in the midst of the worst economic downturn in at least three generations (current circumstances notwithstanding). We briefly chatted with von Tobel about this in a recent episode of Extra Crunch Live, but the topic deserved much more exploration. Von Tobel was gracious enough to talk to us again, and gave us her advice and insights on what it means, and what it takes, to launch a business in the midst of economic uncertainty.

Write it down

Von Tobel says that one of the most important exercises in forming LearnVest — a company that was acquired for $375 million by Northwestern Mutual — was writing out a business plan. It was 75 pages, and by no means a formal document. Rather, the LearnVest business plan was a brain dump of everything von Tobel could possibly think of as it relates to her idea.

“It was nothing beautiful and by no means a work of art,” said von Tobel. “But it was valuable to put it together and walk through this blueprint of all the big questions, all the concerns. How would the customer feel? How big was the market? What was the competition? I even drew up a product plan of how I would roll it out. It was a budget, looking at how much money we think we need to get up and running.”

This business plan also included the areas in which von Tobel felt she was not an expert. She wanted a clear expression of her own strengths and weaknesses built into the business from its very inception.

von Tobel had never written a formal business plan before. She had taken a few business classes at Harvard Business School, but didn’t see the exercise as preparation for publication, but rather her own personal space to develop a product and business.

“It was a macro, more thoughtful plan that allowed me to understand where things were positioned,” said von Tobel. “Perfect is the enemy of good enough. You don’t have to be perfect, but you have to do enough that you have a really clear sense of the picture and a really clear sense of the cracks.”

#advisors, #alexa-von-tobel, #business-plan, #diver, #economy, #entrepreneurship, #finance, #fintech-startup, #harvard, #harvard-business-school, #learnvest, #lehman-brothers, #northwestern-mutual, #roelof-botha, #startups, #tc

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Halal fintech startup Wahed closes $25M led by Saudi Aramco’s investment arm

New York-based fintech startup Wahed (meaning ‘One’ in Arabic) describes itself as a digital Islamic investment platform and as the world’s first ‘halal robo adviser’. It’s now closed a $25 million investment round led by Saudi Aramco Entrepreneurship Ventures (also known as Wa’ed Ventures), a venture capital investment arm of oil giant Saudi Aramco.

Existing investors BECO and CueBall Capital participated, as well as Dubai Cultiv8, and Rasameel. The funds will be used to expand internationally, including developing the company’s subsidiary in Saudi Arabia. The platform is currently running in the US and UK, and has more than 100,000 clients globally. It plans to grow in the largest Muslim markets including Indonesia, Nigeria, India and the CIS. The three-year-old company has already received a license to operate in Saudi Arabia, and aims to get regulatory approval in 20 countries.

According to Crunchbase, Wahed has now raised a total of $40 million in funding since its 2015 founding by Junaid Wahedna.

Last October, Wahed launched in Malaysia after the Malaysian Securities Commission awarded the company the country’s first Islamic Robo Advisory license. The firm is also considering listing its Islamic ETF on the Saudi stock exchange

Ethical investment and Islamic finance is growing in popularity in Muslim countries so long as it is in line with Islamic ethics, so Wahed looks set to benefit.

Commenting on the investment, Junaid Wahedna, CEO of Wahed, said: “We’re excited to have the support of Aramco Ventures as we foray into the Saudi market. We consider Aramco a strategic long term partner in both the Kingdom and the rest of the world.” 

Wassim Basrawi, Managing Director at Wa’ed Ventures, said: “We believe in Wahed’s mission to provide ethical investing. The company has taken the lead in delivering investment services to one of the world’s fastest-growing sectors – Islamic Finance. Wahed is also, in the true spirit of FinTech, helping to broaden the investment landscape. This latest funding round will enable Wahed to make Saudi their regional MENA hub and contribute towards a fast-growing FinTech ecosystem.”

#ceo, #countries, #crunchbase, #economy, #finance, #fintech-startup, #india, #indonesia, #malaysia, #new-york, #nigeria, #saudi-arabia, #tc, #united-kingdom, #united-states, #wahed

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Belvo scores $10M from Founders Fund and Kaszek to scale its API for financial services

Belvo, a Latin American fintech startup which launched just 12 months ago, has already snagged funding from two of the biggest names in North and South American venture capital.

The company is aiming to expand the reach of its service that connects mobile applications in Mexico and Colombia to a customer’s banking information and now has some deep-pocketed investors to support its efforts. 

If the business model sounds familiar, that’s because it is. Belvo is borrowing a page from the Plaid playbook. It’s a strategy that ultimately netted the U.S. startup and its investors $5.3 billion when it was acquired by Visa in January of this year.

Belvo and its backers, who funneled $10 million into the year-old company, want to replicate Plaid’s success and open up an entire new range of financial services companies in Latin America.  

The round was co-led by Silicon Valley’s Founders Fund and Argentina’s Kaszek. With the new arsenal of capital complimented by the Founders Fund’s network and Kaszek’s deep knowledge of the Latin American market, Belvo hopes to triple its current team of 25 that is spread across operations in Mexico City and Barcelona. 

Since its initial establishment in May 2019, the company has raised a total of $13 million from Y Combinator (W20) along with some of the biggest players in Latin America’s startup scene. Those investors include David Velez, the co-founder of Brazil’s multi-billion dollar lending startup, Nubank; MAYA Capital and Venture Friends. 

The company’s co-founders, Pablo Viguera and Oriol Tintoré are no stranger to startups themselves. Viguera served as COO at European payments app Verse, and is a former general manager of one of the big European neo-banks, Revolut. Tintoré is a former NASA aerospace engineer, and while working for his Stanford MBA, founded Capella Space, an information collection startup that went on to raise over $50 million. 

The company said it aims to work with leading fintechs in Latin America, spanning across verticals like the neobanks, credit providers and personal finance products Latin Americans use every day.

Belvo has built a developer-first API platform that can be used to access and interpret end-user financial data to build better, more efficient and more inclusive financial products in Latin America. Developers of popular neobank apps, credit providers and personal finance tools use Belvo’s API to connect bank accounts to their apps to unlock the power of open banking.

Viguera says the capital will be used to open a new office in Sao Paulo, and invest in new product and business development hires. Notably, Belvo is only one year old, having launched in January 2020 and operative in Mexico and Colombia. 

Co-founders Pablo Viguera and Oriol Tintoré are a former Revolut GM and former NASA aerospace engineer.

 

Belvo’s latest funding also marks another instance of a U.S.-Latin America investment teamup for a Latin American company.

Nuvocargo, a logistics startup that wants to bolster the Mexico – U.S. trade lane with its freight transportation technology, also recently raised a round co-led by Mexico’s ALLVP and Silicon Valley-based NFX. American investors may be starting to take note of the co-investment opportunity of putting capital into startups serving the Latin American market in partnership with successful new wave domestic funds like Mexico’s ALLVP and Argentina’s Kaszek.  

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Omidyar-backed Spero Ventures invests in Mexico City’s Mati, a startup pitching ID-verification

Spero Ventures, the venture capital firm backed by eBay founder Pierre Omidyar, has gone to Mexico City for its latest investment, backing the identity verification technology developer Mati.

Launched in San Francisco, the two co-founders Filip Victor and Amaury Soviche, decided to relocate to Mexico because of its proximity to big, untapped markets in Mexico, Brazil, and Colombia.

“After developing the technology in San Francisco, we chose to start commercially in Latin America. It has been the perfect petri dish for us: the markets here, especially in Mexico, Brazil and Colombia, are very exciting. These countries have the highest payments fraud rates in the world, which makes their identity issues the most interesting,” said Victor in a statement.

The rise of a new generation of fintech startup across Latin America creates a unique opportunity for Mati in a number of markets — and so does a new generation of financial services regulations, the company said. “We view the fintech regulations sweeping across LatAm as an opportunity to help a lot of promising fintechs and marketplaces get to the next level”, Victor said.

Already working across three countries, with operations in Mexico City, St. Petersburg, and San Francisco, Mati is an example of the global scope that even very early stage companies can now achieve.

Identity verification is at the core of much of the modern gig economy and much of the social networking defining life during a pandemic.

The company said it will use the capital investment — it would not disclose the amount of money it raised — to continue product development and expand its geographic footprint.

The scope of the identity verification problem is what brought Spero to the table to discuss an investment, according to a statement from Shripriya Mahesh, the founding partner at Spero.

“For us, identity is foundational to scaling the vast array of gig economy, fintech, social, and commerce platforms that represent our collective future of work,” Mahesh said. “The ability to have safe and trusted interactions at an unprecedented scale, especially with people in places where national identity infrastructure is limited, will create opportunities and global connections we can’t yet even forecast.”

#brazil, #colombia, #ebay, #economy, #financial-technology, #fintech-startup, #latin-america, #mexico, #mexico-city, #partner, #pierre-omidyar, #san-francisco, #social-networking, #tc, #venture-capital

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Africa Roundup: Visa connects to M-Pesa, Flutterwave enters e-commerce

It seems the demand for Safaricom’s M-Pesa payment product never eases. Since its 2007 launch in Kenya, the fintech app has commanded over 70% of the mobile money market in that country. When COVID-19 hit the East African nation of 53 million in March, the Kenyan Central Bank turned to M-Pesa as a public health tool to reduce use of cash.

And last month, one of the world’s financial services giants — Visa — connected M-Pesa to its global network.

Visa and Safaricom — which is Kenya’s largest telecom and operator of M-Pesa — announced a partnership on payments and tech.

The arrangement opens up M-Pesa’s own extensive financial services network in East Africa to Visa’s global merchant and card network across 200 countries.

The companies will also collaborate “on development of products that will support digital payments for M-Pesa customers.” The partnership is still subject to regulatory approval.

The details remain vague, but the payment providers also said they will use the collaboration to facilitate e-commerce.

Images Credits: Getty Images

On a continent that is still home to the largest share of the world’s unbanked population, Kenya has one of the highest mobile-money penetration rates in the world. This is largely due to the dominance of M-Pesa in the country, which has 24.5 million customers and a network of 176,000 agents.

As we detailed in ExtraCrunch, Visa has been on a VC and partnership spree with African fintech companies. The global financial services giant has named working with the continent’s payments startups as core to its Africa expansion strategy.

One of those fintech ventures Visa has teamed up with, Flutterwave, launched an e-commerce product in April. The San Francisco and Lagos-based B2B payments company announced Flutterwave Store, a portal for African merchants to create digital shops to sell online.

The product is less Amazon  and more eBay — with no inventory or warehouse requirements. Flutterwave insists the move doesn’t represent any shift away from its core payments business.

The company accelerated the development of Flutterwave Store in response to COVID-19, which has brought restrictive measures to SMEs and traders operating in Africa’s largest economies.

After creating a profile, users can showcase inventory and link up to a payment option. For pickup and delivery, Flutterwave Store operates through existing third party logistics providers, such as Sendy in Kenya and Sendbox in Nigeria.

The service will start in 15 African countries and the only fees Flutterwave will charge (for now) are on payments. Otherwise, it’s free for SMEs to create an online storefront and for buyers and sellers to transact goods.

While the initiative is born out of the spread of coronavirus cases in Africa, it will continue beyond the pandemic. And Flutterwave’s CEO Olugbenga Agboola — aka GB — is adamant Flutterwave Store is not a pivot for the Y-Cominator backed fintech company.

“It’s not a direction change. We’re still a B2B payment infrastructure company. We are not moving into becoming an online retailer, and no we’re not looking to become Jumia,” he told TechCrunch .

In early stage startup activity, a relatively new company — Okra — has created a unique platform that allows it to generate revenue on both sides of the fintech aisle.

Founded in June 2019 by Nigerians Fara Ashiru Jituboh and David Peterside, the company refers to itself as a “super-connector API” with a platform that links bank accounts to third party applications.

Okra’s clients include fintech startups and large financial institutions in Nigeria. The company got the attention of TLcom Capital — a $71 million Africa focused VC firm —that backed Okra with $1 million in pre-seed funding. The Nigerian startup is using the funds to hire and expand to new markets in Africa, most likely Kenya .

More Africa-related stories @TechCrunch               

#africa, #africa-roundup, #amazon, #api, #ceo, #david-peterside, #e-commerce, #east-africa, #ebay, #economy, #finance, #financial-technology, #fintech-startup, #flutterwave, #genomics, #kenya, #lagos, #m-pesa, #money, #nigeria, #okra, #olugbenga-agboola, #online-retailer, #safaricom, #san-francisco, #south-africa, #tc, #techcrunch, #tlcom-capital, #visa, #vodafone

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African fintech firm Flutterwave launches SME e-commerce portal

San Francisco and Lagos-based fintech startup Flutterwave has launched Flutterwave Store, a portal for African merchants to create digital shops to sell online.

The product is less Amazon and more eBay — with no inventory or warehouse requirements. Flutterwave insists the move doesn’t represent any shift away from its core payments business.

The company accelerated the development of Flutterwave Store in response to COVID-19, which has brought restrictive measures to SMEs and traders operating in Africa’s largest economies.

After creating a profile, users can showcase inventory and link up to a payment option. For pickup and delivery, Flutterwave Store operates through existing third party logistics providers, such as Sendy in Kenya and Sendbox in Nigeria.

The service will start in 15 African countries and the only fees Flutterwave will charge (for now) are on payments. Otherwise, it’s free for SMEs to create an online storefront and for buyers and sellers to transact goods.

While the initiative is born out of the spread of coronavirus cases in Africa, it will continue beyond the pandemic. And Flutterwave’s CEO Olugbenga Agboola — aka GB — is adamant Flutterwave Store is not a pivot for the fintech company, which is an alum of Silicon Valley accelerator Y-Combinator.

“It’s not a direction change. We’re still a B2B payment infrastructure company. We are not moving into becoming an online retailer, and no we’re not looking to become Jumia,” GB told TechCrunch on a call.

Image Credits: Flutterwave

He was referring to Africa’s largest e-commerce company, which operates in 11 countries and listed in an NYSE IPO last year.

Flutterwave has a very different business than the continent’s big e-commerce players and plans to stick with it, according to GB.

When it comes to reach, VC and partnerships, the startup is one of the more connected and visible operating in Africa’s tech ecosystem. The Nigerian-founded venture’s main business is providing B2B payments services for companies operating in Africa to pay other companies on the continent and abroad.

Launched in 2016, Flutterwave allows clients to tap its APIs and work with Flutterwave developers to customize payments applications. Existing customers include Uber and Booking.com.

In 2019, Flutterwave processed 107 million transactions worth $5.4 billion, according to company data. Over the last 12 months the startup has been on a tear of investment, product and partnership activity.

In July 2019, Flutterwave joined forces with Chinese e-commerce company Alibaba’s Alipay to offer digital payments between Africa and China.

The Alipay collaboration followed one between Flutterwave and Visa to launch a consumer payment product for Africa, called GetBarter.

Then in January of this year, the startup raised a $35 million Series B round and announced a partnership with Worldpay FIS for payments in Africa.

On the potential for Flutterwave Store, there’s certainly a large pool of traders and small businesses across Africa that could appreciate the opportunity to take their businesses online. The IFC has estimated that SMEs make up 90% of Sub-Saharan Africa’s business serving the region’s one-billion people.

Flutterwave confirmed Flutterwave Store’s initial 15 countries will include Africa’s top economies and population countries of Nigeria, Ghana, Kenya and South Africa.

Those markets already have a number of players driving digital commerce, including options for small businesses to post their wares online. Jumia’s Jumia Marketplace allows vendors register on its platform and use the company’s resources to do online retail.

Facebook has made a push into Africa that includes its overall push to get more users to sell on Facebook Marketplace. The social media giant now offers the service in Nigeria — with 200 million people and the continent’s largest economy.

GB Flutterwave disrupt

Flutterwave CEO GB, Image Credits: TechCrunch

eBay has not yet gone live in Africa with its business to consumer website, that allows any cottage industry to create a storefront. The American company does have an arrangement with e-commerce startup MallforAfrica.com for limited sales of African goods on eBay’s U.S. shopping site.

On where Flutterwave’s new product fits into Africa’s online sales space, CEO GB says Flutterwave Store will maintain a niche focus on mom and pop type businesses.

“The goal is not be become like eBay, that’s advocating for everybody. We’re just giving small merchants the infrastructure to create an online store at zero cost right from scratch,” he said.

That’s something Flutterwave expects to be useful to Africa’s SMEs through the COVID-19 crisis and beyond.

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Extra Crunch Live: Join Roelof Botha for a live Q&A on May 6 at 2pm ET/11am PT

23andMe. MongoDB. Eventbrite. Evernote. Bird. Square . Tumblr. Unity. YouTube. Xoom.

Roelof Botha has had a seat on each of these companies’ boards, but his list of investments is much, much longer.

The Sequoia partner and managing director is legendary in Silicon Valley and the broader tech world, and we’re very excited that he’s joining us for an upcoming episode of Extra Crunch Live that will air on Wednesday, May 6th at 2pm ET/11am PT. Extra Crunch members may join the Zoom call or view the broadcast live (or on demand) on YouTube. If you’re not already a member, you can join here.

Before Botha graduated from Stanford, he had joined the ranks of the PayPal mafia, serving as the fintech startup’s director of corporate development. He climbed the ranks to vice president of finance and was eventually named CFO in 2001. He was just 28 went PayPal went public in 2002.

Following PayPal’s sale to eBay, Botha left the company to join Sequoia Capital in January of 2003; since then, he has been investing in some of the world’s fastest-rising startups.

Botha has been on Forbes’ Midas List every year since 2008 and was ranked third in 2020. He led Sequoia’s investments in companies like Instagram, YouTube and Square and is one of the most respected voices in tech and venture capital alike.

With the coronavirus thrashing the economy and forcing quick adaptation from the tech sector and beyond, Botha can provide a unique look at what comes next for tech and offer advice to startups that are trying to chart a course through a storm that has no end in sight.

We’ll ask Botha how he’s advising his own portfolio companies, any decision-making frameworks he suggests for business leaders who find themselves between a rock and a hard place and his general outlook on VC appetite over the next six to twelve months. There will also be plenty of time for questions from the audience, so come prepared.

You can find the Zoom info below.

Botha joins an incredible list of speakers joining us on Extra Crunch Live, including Kirsten Green, Mark Cuban and Hunter Walk. We’ll be announcing new speakers soon, so stay tuned!

#ebay, #events, #extra-crunch, #extra-crunch-live, #fintech-startup, #paypal, #paypal-mafia, #roelof-botha, #sequoia-capital, #square, #startups, #tc, #venture-capital

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