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Welcome to\u00a0The Interchange! If you received this in your inbox, thank you for signing up and your vote of confidence. If you\u2019re reading this as a post on our site, sign up\u00a0<\/em>here<\/em>\u00a0so you can receive it directly in the future. Every week, I\u2019ll take a look at the hottest fintech news of the previous week. This will include everything from funding rounds to trends to an analysis of a particular space to hot takes on a particular company or phenomenon. There\u2019s a lot of fintech news out there and it\u2019s my job to stay on top of it \u2014 and make sense of it \u2014 so you can stay in the know. \u2014\u00a0<\/em>Mary Ann<\/em><\/a><\/p>\n Hello, hello. By the time you\u2019re reading this, we\u2019ll be two days away from Disrupt! Soooo exciting!<\/p>\n But first, let\u2019s talk about fintech.<\/p>\n Last week\u2019s big news was corporate spend management startup Brex\u2019s announcement that it was laying off 11% of its staff, or 136 people. It was also revealed that the startup\u2019s CFO, Adam\u00a0Swiecicki, is departing to join Rippling as its CFO. Notably, workforce platform unicorn Rippling recently entered the corporate management space, making it a direct competitor with Brex.<\/p>\n First off, it\u2019s rare \u2014 and refreshing \u2014 for a company to actually proactively share news of a layoff, so it\u2019s interesting that Brex got ahead of any gossip and let me know firsthand of its plans. And as Alex Wilhelm pointed out on Friday\u2019s Equity podcast, the layoffs appear to mostly be related to Brex\u2019s move earlier this year to no longer work with SMBs and nonprofessionally funded startups. In other words, the company said it primarily let go of people who were focused on serving that group. Still, it must suck for those employees \u2014 especially considering those groups that it no longer works with were initially Brex\u2019s bread and butter.<\/p>\n Bigger-picture-wise, the news of Brex\u2019s layoffs show that even decacorns have not been immune to this downturn. The company earlier this year confirmed a $300 million Series D extension at a staggering $12.3 billion valuation. And while the company claims to be \u201cin a strong financial position with many years of runway,\u201d it adds that its shift away from SMBs to focus more on enterprise customers \u2014 and, by default, any related layoffs \u2014 will put the company \u201con a path to sustainable profitability over the next few years.\u201d<\/p>\n Side note: Brex aside, it still blows my journalist mind that companies in general can raise hundreds of millions of dollars in funding and yet not be profitable. I am doubtful that I could ever be a venture-backed startup founder. The pressure of having to provide returns to investors who poured that kind of money into my company and the pressure of not wanting to ever have to lay off staff would likely make me lose sleep at night! Guess that\u2019s why I\u2019m a journalist and not a startup founder!<\/p>\n Anyway\u2026speaking of Disrupt and Brex, I will be interviewing co-founder and co-CEO Henrique Dubugras and Anu Hariharan, managing director of YC\u2019s growth fund, YC Continuity, live in a Fireside Chat on October 19! I\u2019ll also be talking to Ramp CEO and co-founder Eric Glyman, Airbase CEO and founder Thejo Kote and Anthemis partner Ruth Foxe Blader in a session called \u201cHow to Compete without Losing Your Mind and Runway When Cash Is Expensive\u201d that same day. And lastly, I\u2019ll be chatting with Rippling CEO and co-founder Parker Conrad about his company\u2019s plans to \u201cgo global.\u201d Come see us! (Get 15% off here).<\/p>\n Oh, and if you want to hear me talk about everything from \u201cThe Good and Ugly Sides of Fintech, What Great Journalism Really Means, & Why Startups Represent Hope,\u201d check out this episode of the Fintech Leaders podcast I recently recorded with VC Miguel Armaza.<\/p>\n Image Credits:<\/strong> Edwin Remsberg (opens in a new window)<\/span> \/ Getty Images<\/p>\n<\/div>\n Hello! It\u2019s Anita Ramaswamy reporting from the fintech desk here at alongside Mary Ann. We\u2019ve been seeing a lot of interest \u2014 and funding news \u2014 in the real estate and proptech spaces lately. Specifically, there have been a number of startups raising rounds for real estate investing apps that aim to help broaden access to the asset class to retail investors by giving them tools to bypass hurdles like large up-front capital requirements that are typically necessary to invest in property.<\/p>\n Fintor is one such example. The startup recently closed on a $6.2 million funding round at an $80 million valuation for its platform that offers fractionalized shares in residential properties to investors for as little as $5. We\u2019ve also covered similar platforms such as Landa, Nada and Arrived Homes, all of which have raised new funding in 2022.<\/p>\n The surge in interest among retail investors for access to real estate might seem counterintuitive given that rising interest rates make real estate seem less attractive than it has been for the past few years. But these startups are likely more focused on long-term, secular demand growth for real estate as a part of a diversified portfolio rather than getting caught up in concerns around short-term volatility.<\/p>\n Here\u2019s what Fintor founder and CEO Farshad Yousefi had to say about the current market environment in an email to :<\/p>\n While recent media headlines have mainly focused on the volatility of the market, there are still present opportunities for investors to take part in investing in real estate with the right type of strategic approach. For example, Atlanta has seen an incredible near 12% year-over-year growth in rental rates, directly boosting investors\u2019 cash flows. Additionally, when looking across the board at the top MSAs, major institutional investors have seen a near 50% jump in renewal rent growth. This drastic upward trend in tenant retention clearly demonstrates where rental demand is going.<\/p>\n<\/blockquote>\n For a deeper dive into real estate tech and how it\u2019s changing the investing landscape, check out my article in TC+ this week:<\/p>\n Plaid<\/b> announced last week that it added two new features to its identity verification product. Via email, Plaid\u2019s head of identity and fraud (and former Cognito CEO) Alain Meier told me: \u201cWith our new autofill feature, users can be verified in as little as 10 seconds. On the back end, we\u2019re building more intelligence to our risk and fraud models with behavioral analytics to stay ahead of fraudsters.\u201d<\/p>\n The behavioral analytics piece is particularly interesting because say you know your SSN\/phone number by heart, then your typing behavior would be very different than if you were to copy and paste it from a document. Plaid acknowledges this sort of technology is not new but claims it\u2019s not usually combined with the other fraud detection features that Plaid offers.<\/p>\n Going after Square? TechRadar reports: \u201cFollowing its acquisition of now Zettle in 2018, PayPal<\/b> has announced a brand new POS device that\u2019s designed to accommodate the needs of small and medium businesses. The newly launched Zettle Terminal connects to the internet via Wi-Fi or a free-of-charge pre-loaded SIM card on the 3G and 4G networks to enable business owners to operate on the go. This \u2018completely mobile\u2019 approach should appeal to multi-location vendors, as it doesn\u2019t require additional setup or manual connection at every new location.\u201d<\/p>\n As reported by Christine Hall: \u201cGreenlight Financial Technology<\/b>, a venture-backed fintech company focused on providing a debit card, banking app and financial education to children, added another layer to its subscription plan with the introduction of family safety features. Greenlight Infinity, priced at $14.98 per month for the whole family, includes location sharing to see where anyone in the family is and do check-ins; SOS alerts to emergency contacts and\/or 911 with one tap; and crash detection with automatic 911 dispatch wherein if a crash is detected while driving, driver and trip information is provided to emergency services.\u201d<\/p>\n TC+ editor Alex Wilhelm dug deep on some Q3 funding numbers, and what he discovered when it comes to the fintech sector wasn\u2019t pretty. He writes: \u201cLooking at Q3 2022 data from CB Insights, it\u2019s clear that the fintech funding boom is behind us; even more, global fintech funding activity is now back to where it was before 2021, indicating that last year was more aberration than new normal for the startup category.\u201d<\/p>\n Sarah Perez reports that Apple<\/b> \u201cis taking a big step toward offering more banking services to its customers. The company announced on Oct. 13 it\u2019s partnering with Goldman Sachs to soon launch a new Savings account feature for its Apple Card credit cardholders which will allow them to save and grow their \u2018Daily Cash\u2019\u00a0\u2014 the cashback rewards that are earned from their Apple Card purchases. In the months ahead, Apple says cardholders will be able to automatically save this cash in a new, high-yield Savings account from partner Goldman Sachs which is accessible with Apple Wallet. Customers will be able to transfer their own money into this account, as well.\u201d<\/p>\n The Los Angeles Times reported that \u201ccredit cards and digital payment apps such as PayPal offer some distinct advantages over cash, including the ability to recover money paid to scammers. But Zelle<\/b>, a digital payment network owned by seven major banks, isn\u2019t so protective of its users. If you use Zelle to pay someone who proves to be a con artist, you have only a slim chance of recovering the money from your bank. The same is true if you send money to the wrong person. If you hit Send, the money is probably gone \u2014 just as if you\u2019d lost a $20 bill on the street.\u201d Meanwhile, there was chatter on Twitter<\/a> that Zelle actually had substantially more transaction volume in 2021 than Venmo and CashApp. Hmm. I\u2019m still trying to find evidence of that.<\/p>\n Seen on <\/em><\/p>\n Former VC brings smart financial advice to people who really need it, instead of just the rich: In announcing this $24.4 million raise led by GGV Capital, Northstar CEO and co-founder Will Peng told me: \u201cThe time from the first meeting to the term sheet was about a month.\u201d<\/p>\n With $67M in new capital, NorthOne is doubling down on SMBs as some fintech companies pull back<\/p>\n Oh look, TripActions raised at a $9.2B valuation after reported $12B IPO filing<\/p>\n Getaway launches a way for you to enjoy, and own, vacation homes<\/p>\n Egyptian consumer money app Telda raises $20M from GFC, Sequoia Capital and Block\u00a0<\/p>\n Airwallex raises $100M to power cross-border business banking, valuation stays flat at $5.5B<\/p>\n Charli D\u2019Amelio-endorsed fintech Step borrows $300M to bring crypto to teens<\/p>\n This company wants to improve your credit by gamifying financial literacy<\/p>\n GoHenry, the banking service for under-18s, raises $55M after passing 2M users<\/p>\n And elsewhere<\/em><\/p>\n VC firm QED acquires fintech executive search company<\/p>\n Astra raises $10M in Series A funding; $30M credit line<\/p>\n Corporate card startup Mercantile raises $22 million to target an unusual niche: professional associations<\/p>\n Financial Finesse launches venture arm supporting \u2018fintech for the greater good\u2019<\/p>\n Well, that\u2019s it for this week! Once again, thanks for your continued support \u2014 and I really hope to see some of you IRL at Disrupt! xoxo, Mary Ann<\/p>\n<\/div>\nVCs clamor to fund real estate investing startups<\/h2>\n
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