BlackFin Tech weekly — October 16th 2023
Every Monday, we publish a short digest which sums up last week’s Fintech activity
Good afternoon, loyal fintech subscribers!
As always, we hope you had a delightful weekend and did not suffer too much from the cold weather.
Let’s kickstart our week by diving into the latest news and trends from the world of fintech:
In the past week, we saw 14 deals in Europe for a total amount of €112.6m raised officially with five deals in the UK, three deals in Germany, two deals in Italy, one deal in France, one deal in The Netherlands, one deal in Estonia and one deal in Belgium.
Congratulations to Upvest, the German trading infrastructure provider, on its €30m venture round led by Blackrock with participation from Bessemer and HV Capital . Well done as well to Alt21 and automated currency hedging solution that raised a €19.4m Series A round.
Finally, London-based Untangled Finance, operating an institutional-grade credit onto blockchain mechanism raised a €12.8m venture round led by lending pioneer Fasanara Capital.
Let’s dive in
Upvest, a Berlin-based startup, recently secured €30 million in funding and entered into a strategic partnership with BlackRock.
The funding round involved BlackRock as a lead participant along with existing investors Bessemer Venture Partners, HV Capital, Earlybird, Notion Capital, ABN Amro Ventures, and 10x Capital.
Upvest offers a plug-and-play API designed to simplify the investment process for fintechs and make investing more accessible across Europe. It allows financial institutions to offer various investment products, including stocks and Exchange-Traded Funds (ETFs) in nominal, portfolio, and fractional forms.
Upvest holds BaFin licenses for securities, crypto brokerage, and custody, and has established partnerships with BNP Securities for custodial services and ABN Amro for payments.
The collaboration with BlackRock will leverage their investment expertise to expand Upvest's offerings to larger financial institutions, aiming to upgrade their investment infrastructure
Upvest plans to utilize the raised capital to enhance its products, support regional expansion, and collaborate with prominent fintech, banking, and wealth management partners. This includes partnerships with companies like Revolut and Raisin Bank.
ALT21, a now London-based hedging technology company, successfully completed a $21 million funding round, marking one of the largest pre-Series A funding rounds in Europe for the year.
ALT21, (previously named Assure Hedge) specializes in providing an end-to-end digital hedging platform that is offered to strategic partners. These partners integrate it into their businesses, enabling their SME customers to easily and affordably protect themselves against currency risks.
In 2022, ALT21 generated more than $8 million in operating income, representing a remarkable five-fold increase compared to the previous year.
ALT21 intends to license its software to a broader spectrum of fintechs and banks, enabling them to offer cost-effective FX services to their customers within their regulated operations.
Over the past year, ALT21 has heavily invested in its platform, focusing on enhancing automation, user experience, operational infrastructure, and processes. Their future plans include investments in artificial intelligence and machine learning to enhance their offering, bridging the gap between human interaction and trading apps for SMEs.
Untangled Finance, a London-based fintech startup, has successfully raised €12.8 million in strategic funding to advance its mission of bringing institutional-grade credit onto blockchain with an integrated liquidation mechanism.
The sole investor in this funding round is Fasanara Capital, a lending pioneer.
Untangled Finance leverages blockchain technology to tokenize traditional assets, offering fractional ownership, borderless access, lower investment thresholds, enhanced transparency, and secure, immutable transaction records.
The funding will support Untangled Finance in bridging the gap between large corporations and SMEs by providing more favourable borrowing terms to underserved SMEs, particularly those in emerging economies. It also aims to streamline the flow of capital across international boundaries, addressing challenges faced by investors in accessing credit opportunities in different regions.
Through its partnership with Fasanara, Untangled Protocol gains access to over 130 verified asset originators from 60 countries, allowing investors to access institutional-grade assets that were traditionally exclusive to major financial institutions.
We would also like to take this opportunity to congratulate Carbon Equity, now a BlackFin Capital Partners portfolio company, on their €6m Series A which we proudly led alongside 4impact.
As the world’s first platform to unlock access to climate venture capital and private equity, Carbon Equity enables mass affluent and high net-worth investors to invest alongside top climate technology funds from low minimums.
The company has experienced strong growth, with its assets under management increasing by 300% and its user base growing 100% since its last funding round in 2022.
'We are seeing a generational shift in our perspective on money — from money purely as a goal in itself to money as a means to help solve global challenges and generate financial returns,' says Jacqueline van den Ende, the CEO who co-founded Carbon Equity
Welcome to the BlackFin Tech family, Carbon Equity !
In addition to this week’s fundraising activity, M&A activities in Europe were relatively quiet, but two are worth mentioning:
Dock Financial, a Munich based cloud native Banking as a Service Platform, has acquired Paydora, a Banking as a Service Provider in Germany. The financial terms of the deal were not disclosed. The acquisition includes the seamless integration of Paydora’s white-label embedded finance platform into the infrastructure of Dock Financial. Dock Financial, founded in 2022 and led by CEO Marko Wenthin, provides services for the integration of banking features. Whereas Paydora, led by CEO Claudio Wilhelmer, is specialized in embedded finance solutions in B2B2C as well as B2B2B. From a technical and regulatory perspective, Paydora Finance's white-label embedded finance platform is based on the financial technology infrastructure of Dock Financial, Mastercard and other partners.
UK-headquartered digital banking software vendor ieDigital has acquired Connect FSS, which enables credit unions to create personal user experience for their members with their own customized digital banking application. The financial terms of the deal were not disclosed. The acquisition will help ieDigital to accelerate its growth plans and cement its position as a leading UK fintech player with international market reach. It will bring more scale and resources to ieDigital that will deliver business value to customers. Both companies already operate with complementary SaaS technology so clients will now be able to get the benefit of both organisation’s software.
And finally, here are the news that caught our eye last week:
SumUp, a European payment technology company, has seen its valuation drop dramatically to as low as $4.1 billion due to inside sales by investors, including Groupon. The fintech industry as a whole has faced a funding downturn, with payments startups being more resilient, while other companies like Stripe and Checkout.com have also experienced significant valuation reductions.
Synapse, a fintech startup supported by a16z, has laid off 40% of its workforce, impacting 86 employees. The layoffs followed the loss of a significant client, Mercury, who decided not to renew their contract and collaborate directly with Evolve, a banking partner, prompting Synapse to reduce its staff due to changed circumstances.
Mastercard has enlisted the expertise of Sir Jeremy Fleming, a former head of the UK's GCHQ intelligence agency, to serve as an adviser and bolster its cybersecurity efforts. In response to growing competition in its core payments business, Mastercard has invested $7 billion in cybersecurity capabilities over the past five years, and Fleming will contribute to shaping the company's strategy in cybersecurity, intelligence, and security while assisting with public policy initiatives.
Swedish tech startup Klarna has launched an AI-powered image recognition tool in its mobile app to help users quickly find and purchase products. Users can point their phones at items like clothing or electronics, and the app will provide tailored recommendations, aiming to create a more shopping-focused experience compared to general web searches offered by Google.
Have a great week & see you soon!