Fintech

Strong week in the FinTech sector with $1.7bn raised

Published

6 months ago

27 July, 2024

FinTech Global this week reported on 21 recorded deals in the FinTech sector, with a strong showing in the reinsurance space bringing the total value recorded over $1bn.

The leading round this week was from Martello Re, an asset-intensive reinsurer, who pulled in $935m in equity funding.

Here are all of this week’s deals.

Asset-intensive reinsurer Martello Re secures $935m

Martello Re Limited, an asset-intensive reinsurer, has successfully closed a second round of equity funding, raising $935m from both existing and new shareholders.

This figure exceeds the initial target of $800m set at the launch of the capital raise.

In addition, Martello Re has expanded its current credit facility by $360m, incorporating four new banks into its lender group. The combined capital commitments bring Martello Re’s total drawn and undrawn capital to approximately $3.6bn, establishing a solid foundation for the company’s continued growth.

Martello Re focuses on providing reinsurance solutions with industry-leading underwriting, risk management, and asset management capabilities

Vanta secures $150m in Series C funding to bolster internet security

Vanta, a leading trust management platform, has announced a substantial $150m Series C funding, marking a significant step in its journey to secure the internet and enhance consumer data protection.

Founded in 2018, Vanta has established itself as a pivotal player in the trust management sector, automating compliance and helping companies like Atlassian and ZoomInfo to strengthen their security frameworks.

Vanta’s platform automates the compliance with critical security frameworks like SOC 2, facilitating faster and more efficient security practices for over 8,000 companies globally.

IntelePeer bags $140m to advance AI automation

IntelePeer, a leading provider of AI-powered communications automation, has announced the successful completion of a $140m growth funding and debt financing round.

This strategic investment was co-led by Savant Growth LLC and VantagePoint Capital Partners, with additional backing from Savant’s limited partners, including Coller Capital, Hollyport Capital, Manulife Investment Management, and Achmea.

The debt financing was led by Vector Capital through its new direct credit strategy, Vector Velocity. Stifel, Nicolaus & Company, Inc. acted as financial advisor to IntelePeer.

IntelePeer specialises in providing AI-driven solutions for automating communications across various channels.

Chainguard secures $140m in Series C

Chainguard has announced a boost in its financial standing by securing $140m in a Series C funding round, catapulting its valuation to $1.12bn.

Chainguard is at the forefront of software security, offering a range of minimal, secure container images designed to facilitate a security-first approach in software development. Led by CEO Dan Lorenc, the company’s innovative products are pivotal for organizations aiming to secure their software supply chains against vulnerabilities. These container images are trusted by top-tier technology and cybersecurity companies such as Anduril, Canva, Hewlett Packard Enterprise, Snowflake, Checkmarx, Cyera, and Wiz.

The newly acquired funds are earmarked for expanding operations and furthering development efforts. This strategic financial boost will support Chainguard in enhancing its portfolio of security solutions, which are essential for tackling vulnerability remediation and securing software supply chains.

Slope secures $65m in strategic funding

Slope, a pioneering B2B payments platform, has recently secured a substantial $65m in a combined equity and debt funding round led by J.P. Morgan.

Other notable participants included Y Combinator, and the Altman brothers’ new fund, Saga. This investment follows a successful period of significant traction and demand, bringing Slope’s total funding to an impressive $252m, comprising $77m in equity and $175m in debt.

Slope stands out in the financial technology landscape by offering comprehensive order-to-cash automation for large enterprises. Utilizing advanced AI tools, the platform facilitates crucial processes such as checkout, customer and vendor risk assessment, embedded short-term financing, and payment reconciliation. This integration not only enhances efficiency but also streamlines the financial operations of its clients.

Digitt secures $50m from CoVenture

Digitt, a pioneering FinTech based in Mexico, has just secured a substantial $50m debt facility with New York’s CoVenture Management.

This strategic partnership aims to overhaul the way prime borrowers are treated in the credit card landscape.

CoVenture Management, a prominent private credit and alternative asset manager, is the sole investor in this significant financial boost. This investment marks CoVenture’s first direct foray into the Latin American market, signaling a robust confidence in Digitt’s mission and operations.

Dazz secures $50m to enhance AI-driven cloud security solutions

Dazz, a leader in unified security remediation, announced today that it has secured $50m in a funding round.

Dazz specialises in redefining risk prioritisation and remediation through the use of artificial intelligence (AI) technologies. This new round of funding will fuel the company’s mission to help security and engineering teams reduce exposure efficiently.

The funds are earmarked for the acceleration of Dazz’s mission. The company intends to continue its groundbreaking work in helping teams across various industries manage and reduce security risks through its innovative platform.

Lithuanian lender Finbee Verslui raises €35m

Finbee Verslui, an alternative lender based in Lithuania, has successfully closed a funding round, securing a €35m investment.

This significant capital infusion marks a pivotal expansion phase for the company, aimed at enhancing its loan services to small and medium-sized enterprises (SMEs) across Lithuania.

The company, which specialises in providing financial solutions to SMEs, will use the new funds to finance over 1,500 businesses. This will allow for quicker loan processing and more favourable terms than previously possible. Since its inception, Finbee Verslui has supported more than 3,000 customers, with 2,000 currently active, and has seen a consistent annual growth of 60% in loan originations over the last five years.

Linx Security secures $33m

Linx Security, a trailblazer in the field of identity security and governance, has officially come out of stealth mode, announcing a substantial $33m in funding.

This financial backing was led by Index Ventures and Cyberstarts, with contributions from seasoned entrepreneurs Mickey Boodaei and Rakesh Loonkar, alongside Cerca Partners and Knollwood Investment Advisory.

The company, founded in 2023 by Israel Duanis and Niv Goldenberg, is set to redefine the approach to securing and managing identities across increasingly complex digital environments. Duanis, the CEO, has a rich background in cybersecurity, including co-founding Fleetonomy, which was acquired by Via in 2020. Goldenberg, serving as CPO, brings experience from his time as VP Product at Transmit, a company known for doubling its ARR under his tenure.

Financial services firm Strive raises $30m in Series B round

Strive Enterprises, a financial services company with a focus on asset management, has successfully raised $30m in a Series B funding round.

The funds will support the launch of Strive Wealth Management, driven by the significant demand for expanded financial services following the early success of its asset management platform in the United States. Strive’s CEO, Matt Cole, highlighted the remarkable growth of their asset management business, noting that assets under management surpassed $1.6bn within two years of launching their first ETF.

Strive aims to leverage Cantor Fitzgerald’s institutional relationships and market expertise to enhance its product and service offerings.

GeoWealth secures $18m from BlackRock

GeoWealth, a Chicago-based turnkey asset management platform (TAMP) and financial technology provider, today announced a significant $18m growth investment.

This funding round was led by BlackRock, with notable contributions from Kayne Anderson Growth Capital and J.P. Morgan Asset Management, both of whom have previously invested in the firm.

GeoWealth specializes in offering a proprietary unified technology platform that supports a wide range of investment use cases for registered investment advisors (RIAs). The platform is designed to facilitate access to a diverse asset mix within a unified account framework, enhancing the flexibility and scalability of investment solutions.

The new funds will be directed towards advancing GeoWealth’s technology offerings. Specifically, the investment will support the development of new tools that enable RIAs to offer more customized and user-friendly investment solutions.

Lakera secures $20m Series A funding

Lakera, a trailblazer in real-time GenAI application security, has successfully raised $20 million in a Series A funding round.

This significant investment was led by Atomico, accompanied by contributions from Citi Ventures, Dropbox, and prior backers including redalpine. The closing of this round comes just a few months after Lakera closed its seed round.

Lakera stands at the forefront of addressing the intricate security challenges that companies encounter with LLMs and Generative AI technologies. Their advanced solutions are pivotal for corporations, including high-profile clients like Dropbox, to protect against emerging vulnerabilities.

Plum secures £16m in Series B funding to propel growth and profitability

Plum has raised £16m in its latest funding round, which comprises £13.4m from a mix of institutional investors and an additional £2.7m through a popular crowdfunding campaign.

According to Finextra Research, this Series B round saw participation from Greece’s Eurobank with a significant €10m minority equity investment in December.

New anchor investor iGrow Venture Capital along with existing backers Venture Friends and Ventura Capital also contributed, showcasing strong continued support from the investment community. The crowdfunding portion attracted over 5,500 investors from across the UK and EU, marking it as Crowdcube’s most notable campaign of the year.

Berlin FinTech startup bunch secures $15.5m

Berlin-based FinTech startup, bunch, has successfully secured a $15.5m Series A investment.

bunch, established in late 2021, offers an end-to-end platform designed to streamline operations, administration, and transactions within private markets. The company’s innovative approach uses advanced data analytics and AI-driven automation to simplify complex workflows and replace outdated systems.

The freshly acquired funds are earmarked for expanding bunch’s technological capabilities and geographical reach, with a strong focus on entering the UK market and engaging more Private Equity clients. This investment will also support bunch’s ongoing mission to overhaul the operational processes of alternative assets, which despite being the fastest-growing asset class, still rely heavily on antiquated methods.

Protexxa bags $10m Series A

Protexxa, a rapidly emerging name in cybersecurity, recently announced the successful closure of its Series A funding round.

The $10m raised highlights the company’s strong market traction and innovative approach to enhancing cyber resilience. The funding round is the largest raised by a sole Black woman founder in Canada.

The investors leading this round include Bell Ventures and Sandpiper Ventures, emphasizing strong support from major players in the industry. Notable contributions also came from existing shareholders such as Export Development Canada, BKR Capital, The Firehood Angels, and Graphite Ventures, among others.

Heeler Security clinches $8.5m in seed funding

Heeler Security, a pioneering startup in the application security space, today announced the successful closing of an $8.5m Seed Series funding round.

This significant financial injection was led by Norwest Venture Partners, with substantial contributions from Storm Ventures.

Heeler Security is dedicated to redefining the landscape of application security. Their innovative approach focuses on enhancing runtime visibility, which is crucial given the complex challenges modern applications face. These challenges have broadened the attack surfaces, leading to increased security risks and a pressing need for real-time, contextual solutions in securing applications.

Insurance broker District Cover secures $7m in funding round

District Cover, a small business insurance broker, has successfully raised over $7m in a funding round that featured participation from Andreessen Horowitz.

The funding will support the official launch of District Cover’s “District Covered” commercial package policy.

This new, proprietary, non-admitted product is issued by Vantage Risk Specialty Insurance Company and aims to bridge the gap between restrictive excess and surplus lines products and costly admitted business-owners policies.

Rift secures $5m in seed funding

Rift, a burgeoning sales platform, recently celebrated a significant milestone by securing $5m in seed funding.

This financial boost was led by Sequoia Capital, with additional contributions from Y Combinator and Soma Capital, alongside a cohort of angel investors. The funds are earmarked to refine and expand their innovative sales solutions.

The company is dedicated to simplifying the B2B sales process by automating routine and time-consuming tasks.

This allows sales teams to focus more on actual selling rather than being bogged down by manual data entry, prospect data scraping, and navigating various sales tools.

UAE FinTech firm Mamo secures $3.4m

Mamo, a UAE-based FinTech startup, has successfully completed a new funding round, raising $3.4m.

Specialising in streamlining financial operations for small and medium-sized enterprises (SMEs), Mamo offers a consolidated platform that integrates payment collection, corporate cards, and expense management. This innovative approach aims to simplify the financial intricacies faced by businesses daily.

The freshly secured funds are earmarked for the expansion of Mamo’s product line within the UAE and to facilitate their entry into new regional markets, including the Kingdom of Saudi Arabia.

Fundabl secures $3.2m to bridge funding gaps

Fundabl, a dynamic Australian lender, announced today the successful completion of a $3.2m equity raise.

This funding milestone is accompanied by the establishment of an enhanced debt facility.

The company, which specializes in loans ranging from $500,000 to $5m, addresses a crucial need in the funding ecosystem by targeting businesses that are often bypassed by traditional financial institutions. This strategic focus comes at a time when funding options for early-stage startups and larger enterprises are abundant, yet there remains a conspicuous gap for mid-sized companies seeking substantial but flexible financing.

UK-based Jarvis raises £1.8m

Jarvis, a pioneering pension FinTech, has successfully completed a seed funding round, raising £1.8 million.

The investment round was co-led by Ascension VC and Cornerstone VC, and also saw participation from the Tokio Marine Future Fund.

The company, which is at the forefront of pension management innovation, focuses on empowering employees to actively plan for their ideal retirement. By integrating various aspects of pension management through its platform, Jarvis addresses the growing need for financial tools that cater to the modern workforce, which is increasingly moving towards self-employment and gig economy roles.

Keep up with all the latest FinTech news here.

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Fintech

US Agencies Request Information on Bank-Fintech Dealings

Published

6 months ago

30 July, 2024

FinCrypt Staff

Federal banking regulators have issued a statement reminding banks of the potential risks associated with third-party arrangements to provide bank deposit products and services.

The agencies support responsible innovation and banks that engage in these arrangements in a safe and fair manner and in compliance with applicable law. While these arrangements may offer benefits, supervisory experience has identified a number of safety and soundness, compliance, and consumer concerns with the management of these arrangements. The statement details potential risks and provides examples of effective risk management practices for these arrangements. Additionally, the statement reminds banks of existing legal requirements, guidance, and related resources and provides insights that the agencies have gained through their oversight. The statement does not establish new supervisory expectations.

Separately, the agencies requested additional information on a broad range of arrangements between banks and fintechs, including for deposit, payment, and lending products and services. The agencies are seeking input on the nature and implications of arrangements between banks and fintechs and effective risk management practices.

The agencies are considering whether to take additional steps to ensure that banks effectively manage the risks associated with these different types of arrangements.

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Fintech

What changes in financial regulation have impacted the development of financial technology?

Published

6 months ago

30 July, 2024

FinCrypt Staff

Exploring the complex landscape of global financial regulation, we gather insights from leading fintech leaders, including CEOs and finance experts. From the game-changing impact of PSD2 to the significant role of GDPR in data security, explore the four key regulatory changes that have reshaped fintech development, answering the question: “What changes in financial regulation have impacted fintech development?”

PSD2 revolutionizes access to financial technology
GDPR Improves Fintech Data Privacy
Regulatory Sandboxes Drive Fintech Innovation
GDPR Impacts Fintech Data Security

PSD2 revolutionizes access to financial technology

When it comes to regulatory impact on fintech development, nothing comes close to PSD2. This EU regulation has created a new level playing field for market players of all sizes, from fintech startups to established banks. It has had a ripple effect on other markets around the world, inspiring similar regulatory frameworks and driving global innovation in fintech.

The Payment Services Directive (PSD2), the EU law in force since 2018, has revolutionized the fintech industry by requiring banks to provide third-party payment providers (TPPs) with access to payment services and customer account information via open APIs. This has democratized access to financial data, fostering the development of personalized financial instruments and seamless payment solutions. Advanced security measures such as Strong Customer Authentication (SCA) have increased consumer trust, pushing both fintech companies and traditional banks to innovate and collaborate more effectively, resulting in a dynamic and consumer-friendly financial ecosystem.

The impact of PSD2 has extended beyond the EU, inspiring similar regulations around the world. Countries such as the UK, Australia and Canada have launched their own open banking initiatives, spurred by the benefits seen in the EU. PSD2 has highlighted the benefits of open banking, also prompting US financial institutions and fintech companies to explore similar initiatives voluntarily.

This has led to a global wave of fintech innovation, with financial institutions and fintech companies offering more integrated, personalized and secure services. The EU’s leadership in open banking through PSD2 has set a global standard, promoting regulatory harmonization and fostering an interconnected and innovative global financial ecosystem.

Looking ahead, the EU’s PSD3 proposals and Financial Data Access (FIDA) regulations promise to further advance open banking. PSD3 aims to refine and build on PSD2, with a focus on improving transaction security, fraud prevention, and integration between banks and TPPs. FIDA will expand data sharing beyond payment accounts to include areas such as insurance and investments, paving the way for more comprehensive financial products and services.

These developments are set to further enhance connectivity, efficiency and innovation in financial services, cementing open banking as a key component of the global financial infrastructure.

Sebastian Malczyk

General Manager, Technology and Product Consultant Fintech, Insurtech, Miquido

GDPR Improves Fintech Data Privacy

Privacy and data protection have been taken to another level by the General Data Protection Regulation (GDPR), forcing fintech companies to tighten their data management. In compliance with the GDPR, organizations must ensure that personal data is processed fairly, transparently, and securely.

This has led to increased innovation in fintech towards technologies such as encryption and anonymization for data protection. GDPR was described as a top priority in the data protection strategies of 92% of US-based companies surveyed by PwC.

Arid Islam

Financial Expert, Sterlinx Global

Regulatory Sandboxes Drive Fintech Innovation

Since the UK’s Financial Conduct Authority (FCA) pioneered sandbox regulatory frameworks in 2016 to enable fintech startups to explore new products and services, similar frameworks have been introduced in other countries.

This has reduced the “crippling effect on innovation” caused by a “one size fits all” regulatory approach, which would also require machines to be built to complete regulatory compliance before any testing. Successful applications within sandboxes give regulators the confidence to move forward and address gaps in laws, regulations, or supervisory approaches. This has led to widespread adoption of new technologies and business models and helped channel private sector dynamism, while keeping consumers protected and imposing appropriate regulatory requirements.

George Blandford

Co-founder, UK Linkology

GDPR Impacts Fintech Data Security

A big change in financial regulations that has had a real impact on fintech is the 2018 EU General Data Protection Regulation (GDPR). I have seen how GDPR has pushed us to focus more on user privacy and data security.

GDPR means we have to handle personal data much more carefully. At Leverage, we have had to step up our game to meet these new rules. We have improved our data encryption and started doing regular security audits. It was a little tricky at first, but it has made our systems much more secure.

For example, we’ve added features that give users more control over their data, like simple consent tools and clear privacy notices. These changes have helped us comply with GDPR and made our customers feel more confident in how we handle their information.

I believe that GDPR has made fintech companies, including us at Leverage, more transparent and secure. It has helped build trust with our users, showing them that we take data protection seriously.

Dr. Rhett Stubbendeck

CEO & Co-Founder, Leverage Planning

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Fintech

M2P Fintech About to Raise $80M

Published

6 months ago

30 July, 2024

FinCrypt Staff

Application Programming Interface (API) Infrastructure Platform M2P Financial Technology has reached the final round to raise $80 million, at a valuation of $900 million.

Specifically, M2P Fintech, formerly known as Yap, is closing a new funding round involving new and existing investors, according to entrackr.com. The India-based company, which last raised funding two and a half years ago, previously secured $56 million in a round led by Insight Partners, earning a post-money valuation of $650 million.

A source indicated that M2P Fintech is ready to raise $80 million in this new funding round, led by a new investor. Existing backers, including Insight Partners, are also expected to participate. The new funding is expected to go toward enhancing the company’s technology infrastructure and driving growth in domestic and international markets.

What does M2P Fintech do?

M2P Fintech’s API platform enables businesses to provide branded financial services through partnerships with fintech companies while maintaining regulatory compliance. In addition to its operations in India, the company is active in Nepal, UAE, Australia, New Zealand, Philippines, Bahrain, Egypt, and many other countries.

Another source revealed that M2P Fintech’s valuation in this funding round is expected to be between USD 880 million and USD 900 million (post-money). The company has reportedly received a term sheet and the deal is expected to be publicly announced soon. The Tiger Global-backed company has acquired six companies to date, including Goals101, Syntizen, and BSG ITSOFT, to enhance its service offerings.

According to TheKredible, Beenext is the company’s largest shareholder with over 13% ownership, while the co-founders collectively own 34% of the company. Although M2P Fintech has yet to release its FY24 financials, it has reported a significant increase in operating revenue. However, this growth has also been accompanied by a substantial increase in losses.

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Fintech

Scottish financial technology firm Aveni secures £11m to expand AI offering

Published

6 months ago

30 July, 2024

FinCrypt Staff

Aveni, Investment Management, AI, NLP, UK

By Gloria Methri

Today

To come
Aveni Assistance
Aveni Detection

Artificial intelligence Financial Technology Aveni has announced one of the largest Series A investments in a Scottish company this year, amounting to £11 million. The investment is led by Puma Private Equity with participation from Par Equity, Lloyds Banking Group and Nationwide.

Aveni combines AI expertise with extensive financial services experience to create large language models (LLMs) and AI products designed specifically for the financial services industry. It is trusted by some of the UK’s leading financial services firms. It has seen significant business growth over the past two years through its conformity and productivity solutions, Aveni Detect and Aveni Assist.

This investment will enable Aveni to build on the success of its existing products, further consolidate its presence in the sector and introduce advanced technologies through FinLLM, a large-scale language model specifically for financial services.

FinLLM is being developed in partnership with new investors Lloyds Banking Group and Nationwide. It is a large, industry-aligned language model that aims to set the standard for transparent, responsible and ethical adoption of generative AI in UK financial services.

Following the investment, the team developing the FinLLM will be based at the Edinburgh Futures Institute, in a state-of-the-art facility.

Joseph Twigg, CEO of Aveniexplained, “The financial services industry doesn’t need AI models that can quote Shakespeare; it needs AI models that deliver transparency, trust, and most importantly, fairness. The way to achieve this is to develop small, highly tuned language models, trained on financial services data, and reviewed by financial services experts for specific financial services use cases. Generative AI is the most significant technological evolution of our generation, and we are in the early stages of adoption. This represents a significant opportunity for Aveni and our partners. The goal with FinLLM is to set a new standard for the controlled, responsible, and ethical adoption of generative AI, outperforming all other generic models in our select financial services use cases.”