Mary Ann<\/em><\/a><\/p>\nFirst off, I have to say that this past week was one of the busiest fintech news weeks I have experienced in a long while. Whoa. So.much.going.on. While I couldn\u2019t obviously cover it all, I attempted to fit as much of it as I could into this newsletter.<\/p>\n
Before we get into the various news items from the past week, let\u2019s talk about bank charters.<\/p>\n
For the unacquainted, according to Investopedia: \u201cA chartered bank is a financial institution (FI) whose primary roles are to accept and safeguard monetary deposits from individuals and organizations, as well as to lend money out. Chartered bank specifics vary from country to country. However, in general, a chartered bank in operation has obtained a form of government permission to do business in the financial services industry. A chartered bank is often associated with a commercial bank.\u201d<\/p>\n
In 2020, digital bank Varo became the first-ever all-digital nationally chartered U.S. consumer bank \u2014 meaning it received approval from the Office of the Comptroller of the Currency to become an actual<\/em> bank, as opposed to partnering with one as most digital banks do.<\/p>\nIt was a bold, and risky, move. So I talked to Varo CEO and founder Colin Walsh to find out if it was worth it. His answer? 100%.<\/p>\n
To read my full interview with Walsh on just how things have been going since, head here.<\/p>\n
The corporate cards just keep on coming<\/h2>\n
Mercury<\/strong> announced last week that it launched a new corporate credit card. Via email, a spokesperson told me that the IO Mastercard is designed to help startups scale their business. \u201cIt\u2019s straightforward 1.5% cashback on everything, no personal credit check and the first step to qualifying for the card is having just $50,000 in a Mercury account.\u201d<\/p>\nThe company added that a corporate credit card has been one of the most requested features from customers since Mercury launched in 2019. In fact, Mercury actually considered launching with a credit card as its first product but instead chose to start with creating a bank account instead since \u201cevery founder needs a bank account to run their business\u2026and [they] are the ideal foundation from which to build additional financial features.\u201d The move is admittedly an effort to carve out its own space against the likes of Brex and Ramp.<\/p>\n
Meanwhile, European fintech Payhawk<\/strong> announced that it is launching in the U.S. with a focus on enterprise customers. As part of that move, it is also launching its \u2014 you guessed it \u2014 first credit card product in the U.S. The move follows what a spokesperson describes as \u201ca huge year\u201d for the company: Over the last 12 months, it grew revenue by over 520%. The company achieved unicorn status after extending its Series B round to $215 million.<\/p>\nWe\u2019re not done yet! Center<\/strong>, which was co-founded by former Concur CEO and co-founder Steve Singh and launched its own corporate card and expense software offering aimed at small- and medium-sized enterprises, recently shared that in the last year, it tripled its customer base \u201cwhile retaining 94% of existing customers\u201d and doubled the company size. This is particularly interesting because many of the existing corporate card players often point to Concur as an incumbent that they are trying to replace.<\/p>\nThese companies, of course, join a plethora of others in the U.S. already offering corporate cards, including \u2014 but not limited to \u2014 Brex, Ramp, Airbase, Mesh Payments and Rho.<\/p>\n
Weekly News<\/h2>\n
Adyen<\/strong> announced on September 15 that it has become the first fintech to partner with Cash App (Block) <\/strong>to offer Cash App Pay, a mobile payment method, to its U.S. customers. Adyen said its businesses will be giving customers a way to pay using their Cash App balance or linked debit card. Cash App COO Owen Jennings said in a written statement: \u201cAs the first financial technology platform outside of the Square ecosystem to launch Cash App Pay, we look forward to seeing the value this partnership brings to our customers and Adyen\u2019s businesses.\u201d An Adyen spokesperson told me via email: \u201cThe partnership will provide Adyen business customers access to over 80 million active customers that make up a third of Millennial and Gen Z consumers in the U.S. Their customers, in turn, will be provided with another convenient, seamless way to pay at checkout that fits their unique financial needs and habits.\u201d<\/p>\nSpeaking of Block<\/strong>, the company formerly known as (and still goes by sometimes) Square<\/strong> announced last week that its entire ecosystem of more than 35 products and services is now available in Spanish to sellers in the United States. This means that millions of Hispanic-owned businesses in the U.S. will have the ability to use Square in English or Spanish, \u201cincluding key products like Square Banking to unlock access to financial services and Square for Restaurants to enable seamless, bilingual communication between front- and back-of-house staff.\u201d<\/p>\nWhile we\u2019re on the topic of payments, Goldman Sachs and Modern Treasury<\/strong> announced they are partnering \u201cto accelerate the shift to embedded payments, helping joint customers embed and scale payments into products.\u201d Via email, a Goldman Sachs spokesperson told me that the partnership furthers \u201cGoldman\u2019s push to better serve mid-market companies that have long wanted to bank with Goldman.\u201d In a written statement, Eduardo Vergara, head of product and sales at Goldman Sachs Transaction Banking, said, \u201cEmbedding payments into software products is increasingly the trajectory of commerce, and by partnering with Modern Treasury, we are creating new opportunities for clients to seamlessly leverage our payments capabilities within their own platforms.\u201d<\/p>\nIn other Goldman Sachs<\/strong> news, Bloomberg reported that the investment banking and financial services giant is \u201cembarking on its biggest round of jobs cuts since the start of the pandemic.\u201d The publication cited people with knowledge of the matter who said that Goldman \u201cplans to eliminate several hundred roles starting this month.\u201d<\/p>\nBuy now, pay later<\/strong> made headlines several times last week. First, the Associated Press reported that (unsurprisingly, and sadly) while \u201cAmericans have grown fond of \u2018buy now, pay later\u2019 services\u2026 the \u201cpay later\u201d part is becoming increasingly difficult for some borrowers.\u201d Meanwhile, \u2019s Kyle Wiggers<\/a> reported that the U.S. Consumer Financial Protection Bureau (CFPB) <\/strong>on September 15 \u201cissued a report suggesting that companies like Klarna and Afterpay, which allow customers to pay for products and services in installments, must be subjected to stricter oversight.\u201d Meanwhile, Affirm<\/strong> CEO Max Levchin told Bloomberg Law in an interview: \u201cA fair amount of what the report has called for we have chosen to do. We have always seen this as a lending activity subject to all the lending rules and regulations.\u201d<\/p>\nProptechs continue to take a hit. Residential real estate marketplace Sundae<\/strong> last week conducted its second layoff this year. About 28% of the team \u2014 mostly sales and support staff \u2014 were laid off. Specifically, about 106 employees were let go. I reached out to the company for confirmation and a spokesperson told me via email that \u201cSundae is focusing on creating a more streamlined customer experience so that we can get offers to sellers even faster. The market remains volatile and we saw layoffs as an opportunity to use data and technology to streamline our approach and improve our customer experience.\u00a0 We also saw these decisions as an opportunity to build a longer runway.\u201d I covered the company\u2019s 2021 raise here.<\/p>\nIn more uplifting personnel news, Forage<\/strong> \u2014 a payments processor that aims to make it easier for grocers to accept SNAP EBT payments online \u2014 revealed that Kristina Herrmann is joining the company in the new role of chief business officer. She comes to Forage after nearly 16 years at Amazon, where she most recently built out and led the company\u2019s underserved populations team as its founder and general manager. Earlier this year, I wrote about how Ofek Lavian left his role as Instacart\u2019s head of payments to join Forage. Today, he serves as the startup\u2019s CEO.<\/p>\nFIS<\/strong> has launched Worldpay for Platforms, an embedded finance solution aimed at SMBs. Businesses that use the offering, FIS told me via email, \u201celiminate the need for SMBs to pay separate partners to help with card issuance, cash advances or faster access to cash flow.\u201d Obviously, this has implications for companies such as Stripe or Plaid, or other embeddable products that target the small business marketplace.<\/p>\nICYMI: Revolut<\/strong> recently announced a new online checkout feature, Revolut Pay, that \u201clets consumers pay at an online checkout with just one click.\u201d<\/p>\nSeen on <\/em><\/p>\nFor LatAm payment orchestration startups, market fragmentation is a blessing in disguise\u00a0<\/p>\n
Linus Foundation announces the OpenWallet Foundation to develop the interoperable digital wallets<\/p>\n
YC Batch shows founders remain optimistic about fintech<\/p>\n
![\"\"](\"https:\/\/www.ghanamma.com\/gp\/wp-content\/uploads\/2022\/09\/Forage.jpeg\")
<\/p>\n
Image Credits:<\/strong> Forage\/Kristina Herrmann, Chief Business Officer<\/p>\n<\/div>\nFundings and M&A<\/h2>\n
Seen on <\/em><\/p>\nRatio bags $411M in equity, credit for flexible subscription payment models<\/p>\n
Kenya\u2019s insurtech Turaco maintains 1 billion user target as it raises $10M in funding<\/p>\n
Denim, a fintech platform for freight brokers, raises $126M in equity and debt<\/p>\n
Allocations just got valued at $150M to help private equity funds lure smaller investors<\/p>\n
Payall lands $10M in a16z-led seed round to help banks facilitate more cross-border payments<\/p>\n
Lease-to-own fintech startup Kafene raises $18M to battle BNPL<\/p>\n
Southeast Asian fintech Fazz raises $100M Series C to serve businesses of all sizes<\/p>\n
Nigerian financial management app for merchants Kippa bags $8.4M in new funding<\/p>\n
Fintech startup Power flexes its credit card muscle following $316M equity, debt injection<\/p>\n
Indian fintech Cred to invest in lending partner Liquiloans<\/p>\n
And elsewhere<\/em><\/p>\nAlternative asset management platform Ethic bags $50M<\/p>\n
Composer raises $6M for automated investing platform<\/p>\n
Redfin CEO, DoorDash co-founder invest in new startup, Far Homes, which is building a portal for Mexico real estate<\/p>\n
German software firm Candis raises $16M to expand AP automation<\/p>\n
Splitit drives installments-as-a-service growth with a $10.5M funding<\/p>\n
PortX launched as new entity by ModusBox and secures $10M in new funding\u00a0<\/p>\n
JPMorgan Chase acquires payments fintech Renovite to help it battle Stripe and Block<\/p>\n
Whew. That was a lot, and if this week was any indication, the fourth quarter is going to be crazy. I\u2019m heading out now in an attempt to refresh this weekend. Hope you\u2019re doing the same! See you next week! xoxoxo Mary Ann<\/p>\n\n
In case you have been hiding under a rock and haven\u2019t heard, Disrupt is coming to San Francisco October 18\u201320! I would absolutely love to see you there. Use the code INTERCHANGE to get 15% off passes (excluding online and expo), or simply click\u00a0<\/strong><\/em>here<\/strong><\/em>.<\/p>\n\n\u00a0<\/p>\n<\/div>\n