BlackFin Tech Weekly — May 27th, 2024
Every Monday, we publish a short digest which sums up last week’s Fintech activity.
Hello FinTech Friends,
Welcome back to our newsletter! We saw several Fintech deals last week, most done in the UK. We also have some interesting news in the payment space and from German Neobank N26, so read on!
Last week we saw 5 official fintech deals in Europe for a total amount of €130m raised with 4 deals in the UK, and 1 in Germany.
Congratulations to, the UK-based PSP, Vitesse who has raised €85m in a Series C funding round led by KKR, with participation from existing investors Hoxton Ventures, Octopus Ventures, and Hannover Digital Investments. Applause also goes out to GB Bank, a real estate lender, who has secured €45m million in additional capital from Hera Holdings and the Teesside Pension Fund. Lastly, we extend our congratulations to Rows. This cloud platform-based spreadsheet app has raised €8 million in a round led by Indico Capital Partners, with participation from existing investors Cherry Ventures, Accel, Lakestar, Armilar Venture Partners, and others.
Let’s dive in
Vitesse, the UK-based PSP, has raised €85m in a Series C funding round led by KKR, with participation from existing investors Hoxton Ventures, Octopus Ventures, and Hannover Digital Investments. Founded in 2013, Vitesse offers an all-in-one treasury and payment management platform for insurance companies, streamlining international payments through a network of clearing systems and providing services like liquidity management, cash-flow forecasting, and real-time visibility into cash positions across multiple accounts and currencies. The new funds are said to be used to bolster Vitesse's expansion efforts in the U.S.
GB Bank, a key player in property project funding for SME developers and investors in the UK, has secured £85 million in additional capital from Hera Holdings and the Teesside Pension Fund. Hera Holdings, based in Jersey, will invest an initial £40 million over the next year, followed by an additional £40 million across 2025 and 2026. The Teesside Pension Fund, an existing shareholder, has committed an extra £5 million. This substantial investment will enhance GB Bank’s funding capabilities, particularly for property investments and regeneration initiatives in the UK. The funds will also fuel GB Bank’s expansion, allowing it to offer up to £10 million in funding with an 80% Loan To Value ratio and grow its lending portfolio to £500 million within the next year. The bank, which obtained its license in August 2022, has already approved over £80 million in loans and attracted over £300 million in deposits.
Rows, a cloud platform-based spreadsheet app, has raised €8 million to accelerate data integrations, enhance AI features, and expand its presence in key markets. The funding round was led by Indico Capital Partners, with participation from existing investors Cherry Ventures, Accel, Lakestar, Armilar Venture Partners, and others. Rows offers comprehensive functionality similar to Excel and Sheets, along with a unique layout, seamless user experience, stunning charts, built-in integrations, AI co-pilot, and robust collaborative features. Co-founder and CEO Humberto Ayres Pereira expressed excitement about the new investment and continued support from existing investors, emphasizing their readiness to scale globally with Indico's support.
In addition to this week’s fundraising activity, here is the European M&A activity of the week:
Lukka has announced its acquisition of Coinfirm. Lukka provides blockchain and digital asset data solutions to established financial institutions, government agencies, and crypto-native businesses. Lukka was founded in 2014 in the US and has since raised over $200 million in funding. Today it employs around 300 people and has hundreds of clients around the world. Its acquisition target, Coinfirm, is a London-based, blockchain analytics platform. It specializes in AML detection, compliance, and advanced blockchain analytics. With the acquisition, Lukka increases the breadth of its services and deepens its expertise. Furthermore, Lukka is assessing other opportunities to grow its business further through more M&A and partnerships with other firms.
And finally, here are the news that caught our eye last week:
Stripe debuts Pay by Bank, its first Open-Banking-powered payment method, facilitating low-cost, real-time transactions from consumer bank accounts. Additionally, Stripe Capital now extends flexible financing options to UK businesses based on transaction history, with funds available the next business day. With the UK as its second-largest market, Stripe's expansion underscores the country's strong business infrastructure and talent pool, solidifying its commitment to empowering businesses and enhancing payment experiences.
BaFin imposes a €9.2 million fine on N26 for delayed submission of suspected money laundering reports in 2022. This penalty follows previous concerns regarding N26's anti-money laundering controls, including a €4.25 million fine and customer cap in 2021. Currently restricted to 50,000 new customers monthly, N26 faces ongoing audits to address deficiencies, particularly in IT monitoring and quality assurance. Despite these challenges, N26 has made significant investments exceeding €80 million since 2022 to enhance anti-money laundering processes and infrastructure.
The CFPB mandates BNPL firms to comply with credit card consumer protection regulations concerning billing disputes and refunds. This move aims to ensure that BNPL lenders afford similar rights and safeguards as traditional credit card providers.
Three new requirements include investigating disputes, refunding returned products, and issuing periodic billing statements akin to classic credit card accounts. The director of the CFPB underscores the importance of curbing overextension and excessive debt accumulation in the BNPL sector by applying established regulations to this form of credit.
The collapse of Synapse, a Banking as a Service (BaaS) platform, has resulted in Copper abruptly discontinuing its bank deposit accounts and debit cards. Despite plans to shift focus to a white-label product and its Earn platform, Copper had to close banking accounts sooner than anticipated. Synapse's bankruptcy filing and failed asset sale to TabaPay exacerbated the situation. While some Copper customers encountered challenges accessing their funds, the CEO assures that most have been returned.
Have a great week & see you soon!
Sources of the fundraising reports.