Hi all, it’s been a week in the fintech world when I published two separate articles on startup layoffs and a nine-figure funding round. in about a few hours. It was also a week with a lot of activity on FinTwit, or “Financial Twitter,” as it is better known — thanks to a little more back and forth involving Stripe and Plaid. So grab your popcorn and sit down for some as I try to break it down for you. Want this in your inbox every Sunday morning? Registration this!
Earlier this week, I joked that when I started using fintech, I expected it to be a pretty dry and low-key beat. Now I laugh at my innocence.
Perhaps the biggest news this week in the fintech world is the launch of Stripe’s new Financial Connect product, which TC’s Ingrid Lunden covered. this. The product launch in and of itself is credible, yes. But what raised it up in the trustworthy world is that it caused some controversy, because it’s almost exactly what Plaid, a one-time Stripe’s partner, does. And that’s it gives Stripe customers a way to connect directly to their customer’s bank account, to access financial data to speed up or run certain types of transactions. Again, that’s what Plaid does.
In a tweet that has since been deleted, Plaid CEO and co-founder Zach Perret responded to a tweet from Stripe PM Jay Shah, essentially questioning Stripe’s “methods” may have collected information to build the product. Shah responded to that tweet with one of his own defending his actions and that of his company.
A few hours later, Perret admitted on Twitter that he deleted his tweet, noting: “Deleted tweet. Possible misinterpretation or different style. Assumption is positive intent. ”
Meanwhile, internally at Stripe, executives addressed the issue with an internal memo. Specifically, Patrick Collison said his “enthusiasm” for Stripe’s new product was “fired by the accusations” of Perret. He’s obviously traumatized that Plaid might be a little upset that Stripe has unveiled this competing product, even after the two companies had previously worked together on integrations.
Huh!
He ended his internal note with an admission that Stripe “should definitely leave the door open” that it could handle things better. It’s great that he admitted this but it’s also hard to believe that these moderators did no idea that the move would lead to the tension it did. Patrick even went on to say that perhaps Stripe should let Plaid know “so they can privately express any concerns they have.” He added that while Stripe didn’t necessarily have to, it could have avoided the public debate that ensued if it had only told Plaid sooner.
Meanwhile, Patrick’s brother and co-founder, John, tweeted that Perret was “kind” in deleting his original tweet. He added: “We understand that his views on the whole thing may still differ. Either way, we still do a lot with Plaid. They are a great company and we look forward to finding more ways to work together. ”
I contacted both companies for their respective salaries and both declined to be interviewed. It is true that we may never know what really went down in this particular case. But what I do know is that the controversy has opened up a whole other conversation, including claims that this isn’t the first time Stripe has been accused of negligent conduct. These included (unproven) allegations that the company previously pretended to be interested in buying other companies or hiring people to try to get their information. It also sparked conversation when Stripe reportedly pressured Sequoia investors to withdraw from an investment that smells of competition.
I’m not here to make any call to judgement as this story is probably still ongoing and we don’t know what is the truth yet. That said, my humble opinion is that whether you’re big or rich, small or not, it’s not worth it to act immoral. I would rather not be rich and know I did the right thing with the people I have dealt with than be rich and have my integrity questioned over and over again. But that’s just me.
If you want to hear Equity team working on this topic, listen this.
In other news
On the topic of fintech dramas, Flash recently appeared in the headlines for a number of reasons that I’ve outlined Finalk, including a lawsuit filed by a major customer and reports that revenue and customer growth slowed. Well, last week, the company issued an indirect response to the second issue in the form of a blog post written by CEO Maju Kuruvilla. You can read all about it this.
I wrote a story about how Truistsixth largest bank in the US with $488 billion in assets, acquired a startup of 12 people summon Long game in an effort to attract more GenZ and younger generation customers. Led by Lindsay Holden, the startup has has raised over $20 million in funding and has built a gambling finance mobile app that aims to help people “save, learn and engage” with their finances. The acquisition is proof that fintech and banks can work together. There is also evidence that many financial institutions recognize the value of acquiring technology rather than building it themselves. In other words, incumbents in some cases demand fintech even as they compete with them.
Image credits: Long Game CEO and Co-Founder Lindsay Holden
As mentioned above, there are also layoffs in the fintech world like Main road – a startup that helps other startups discover tax credits – lay off about 30% of its employees. We don’t really know why or exactly how many people were affected but that’s not good news for a company valued at $500 million in January 2021 and especially not good news for affected employees. The company did not return a request for comment on the layoffs but in a tweet, CEO Doug Ludlow admits “an extremely tough market.” He also hinted that this might just be the beginning, saying “There’s a very good chance that today’s extremely tough market will only get worse, and will likely stay that way for months, if not years.”
Speaking of layoffs, Robin Hood hero recently lay off about 9% of the company’s employees, and apparently trying to boost the company’s cash flow hasn’t been done yet. Anita Ramaswamy wrote about how the trading platform was implemented a feature that will allow users lend their stock in the hope of earning a recurring, passive income from borrowers. The company already makes money lending shares to customers who buy them “on margin,” and this new stock lending program is expected to bring in one to two times more revenue than the lending service. current margin, the company’s chief financial officer Jason Warnick said on company earnings call last week.
On a more positive note, Tage Kene-Okafor wrote about how Rali_capan early stage venture capital firm focusing on fintech investments in emerging markets, 30 million dollar fund launched. Last month, the company, formerly known as Rally Cap Ventures, hit an initial close of $20 million (original target) before scaling up the fund, signaling a strong appetite for LPs.
The two-year-old VC fund invests in early API and B2B fintech technologies across Africa, Latin America, and South Asia at pre-seed and seed stages. It is expected to hit a second close by the end of June
Early stage technology investment company Picus Launch of the Venture Partner Network and selected Gerry Giacomán Colyer, co-founder and CEO of Mexican corporate spending startup Clara, as its first partner. According to Picus, Colyer will “support founders in the Latin American tech ecosystem to accelerate their growth journey and will serve as an expert on fintech-related topics for founders.” globally”.
Start Fintech-as-a-service Rapyd launch Virtual Account, a product that aims to give businesses a way to expand globally while also supporting local payments. In other words, “This new offering enables institutions anywhere in the world to securely and reliably accept local bank transfers across more than 40 countries in more than 25 currencies, including including the US, UK, EU and APAC regions.”
Expense
The BNPL crackdown has not been quelled yet Walnuts and its latest $110 million funding – the startup raised $10 million in equity and $100 million in debt, as told by Natasha Mascarenhas, whom I’m happy to share, will include more fintech as it involves include and access!
Case in point, she also wrote this nicely executed piece on Line of $7 million in equity and $25 million in debt increase: Holistic fintech is hard to get right, so Line has a different direction
Fundid first pouring capital into providing capital, credit for small businesses – Christine Hall
Fintech Chile Xepelin want LatAm businesses to get paidbecause it raises Series B to $111 million – Christine Hall
Anchor Bank backed by Google Open become India’s 100th unicorn with new capital – Manish Singh
Concerto raised $21.2 million to bring co-branded credit cards to more brands – Kyle Wiggers
Zenda received $9.4 million to streamline tuition payments and management – Annie Njanja
Kevin raised $65 million as it charges upfront for account-to-account payments via terminals at the point of sale – Ingrid Lunden
Masa get $3.5 million in seed money to build its decentralized credit protocol – Tage Kene-Okafor
of Canada Neo Financial ends with $145 million Series C as it surpasses 1 million customers and achieve unicorn status
Tactic want to reinvent accounting software for the web3 age Founders Fund and Ramp co-led startup’s $2.6 million seed round
Just close $115 million to give homeowners a way to cash out the equity in their home – Andreessen Horowitz GP Alex Rampell co-founded the company and is now an investor in it
Another company in that same space, Home page recently raised 7 million dollars for the product owns its own home
Realtoweb-based automated market operator for secondary trading of illiquid real estate and alternative securities, raised $4.5 million in a round led by Firebrand Ventures.
Based in Dallas Backflips seed farming 8 million dollars to finance local real estate investments
Pointsays it is developing an approach to venture capital investing that provides a way for investors of all sizes to participate, raised $15.3 million in Series A funding. Christine Hall covered the company 5 million dollars increase seed July last year.
That is great number of among the crowdfunding consider that we are going through a market correction! They were probably closed a while back and have just now been announced. Either way, that’s it for this week. Thank you for reading, and if you’re a mom like me, I hope you have a great Mother’s Day!
