Fintech
Should venture capitalists be held accountable when startups fail?
Welcome to TechCrunchFintech! Last week was a holiday in the US, so the news was a little lighter than usual. But there were still fintech-related items to report, including the ongoing drama surrounding Synapse and partner Evolve Bank, Revolut’s record year, and more.
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The big story
Evolving the bank Data breach is still ongoing in the fintech sector and several startups are suffering from it. Road performancefor example, last week confirmed some of its customers they were hitMeanwhile, Fintech Business Weekly author Jason Mikula said he had received a letter of cessation and abstention from the bankasking him not to share files from the dark web with any of the alleged affected fintechs. “As I understand it, some fintechs had not received ‘confirmation’ from Evolve about what had been breached and therefore had not taken action to mitigate the risk or notify users,” Mikula told TechCrunch. And a group of senators have joined together to urge Synapses owners and fintech and banking partners (including Evolve) to “immediately restore Customers’ access to their money.” As part of their demands, the senators implicated both the company’s shareholders and investors as Andrea Horowitz (a16z) as responsible for customer missing funds.
The last of the saga concerns a new dispute between fintech intermediaries Synapses and its database provider, MongoDBthat is threatening independent advisers’ attempts to return money to millions of customers of apps like Juno and Yotta, who have been cut off from their money for weeks, Bloomberg reports.
Analysis of the week
Revolution revealed last week that its full-year pre-tax profit rose to a record $545 million in 2023 after acquiring 12 million customers during the year. (Yes, profit. Impressive.) Nikolay Storonsky, CEO and co-founder of Revolut, he told CNBC that the digital bank is “confident” of obtaining a UK banking licence. The bank has also hinted at an IPO in its annual report, saying it had “tightened” its financial controls in ways that “listed companies” do. If/when it goes public, some former executives may feel some regret for leave the company. Revolut was the last valued at $33 billion when it raised $800 million in 2021.
Dollars and cents
Investors are betting on Indian wealth tech startups as a growing middle class turns to diversifying investments and startups challenge traditional financial advisors for high-net-worth clients, Manish Singh reports. Premji Invest is in late-stage discussions to lead a $30 million to $40 million funding round in Dezerv, an app that offers a suite of investment solutions to wealthy Indians. And Lightspeed Venture Partners is in late-stage discussions to lead a $20 million-plus investment round in Centricity, a digital wealth management platform. More Here.
What else are we writing?
Speaking of breaches, TechCrunch’s Devin Coldewey tells readers they shouldn’t worry about their secret ChatGPT conversations were obtained in a recently reported breach of OpenAI systems. He writes, “The hack itself, while concerning, appears to have been superficial, but it is a reminder that AI companies have quickly become one of the juiciest targets for hackers. … The simple fact is that these AI companies have become the gatekeepers to a huge amount of very valuable data.” Read more Here.
Titles of great interest
To tremblean institutional provider of digital asset operating systems, recently announced an initial investment of 2.4 million euros co-led by TX Ventures (CH) and Market One Capital (LUX). The funding is aimed at strengthening its presence in the European market, FinTech Global reports.
MUFG Backs Thai Fintech Unicorn Ascend Money With $195M Funding
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