My new column is focused on financial services. I will be publishing this every Sunday so be sure to listen to the Equity show and hear me and Alex talk about all things startup. Once it becomes a newsletter, you can sign up here to have it hit your inbox directly.
It has been difficult to concentrate during the last part of this week due to global events, so forgive me if my tone is less upbeat than normal. My heart goes out to the people of Ukraine.
I wrote about a couple of instances in which companies went horizontal. The company announced it was expanding into media and entertainment. The travel space is where Ramp is branching out.
It will be interesting to see if Pipe's decision to enter media and entertainment is a good one. The company seems confident that it can apply its model to many other areas.
When the Pandemic hit, Ramp's expansion into travel put it into direct competition with TripActions, which had been helping companies manage travel expenses to corporate spend in general. I took a look at this increasingly crowded and competitive space a few weeks back. It's clear that it's only going to get more heated and I'll be paying close attention.
Bonnie Rae Mills Photography has a picture of co-founders Gloria Lin and Joel Poloney.
It feels like we are seeing more and more female-led startups in the field of financial technology. I was so impressed with the two startups that I wrote about last week. Gloria Lin was on the team that helped prototype ApplePay and helped start Siteline, a company that helps commercial trade contractors get paid faster and easier. Her mission is personal. She saw how hard it was for her father to get paid when he owned a trade contracting business. The construction industry is one of the least digital. It was good news to report that Siteline had emerged from stealth with $18.4 million in funding, of which 15 million was raised in a Series A led by Menlo Venture and $3.4 million was raised in a seed round. I love to see it.
The co-founder and CEO of the company is named Lilly.
I reported on a startup called Pi that helps renters get rewards for paying their rent on time and build their credit at the same time, which just raised $13 million in Series A funding. I've written about other companies who want to help renters build a credit history, because how unfair is it that on-time rent payments have not been factored in historically? It is free to rent, that's what Piñata says. The company makes money from the property management companies and landlords that sign up for its service via a monthly subscription. It makes money through brands and partners on the business development side.
There is still a long way to go in seeing more equal gender representation in leadership roles. In the world of startups, the global fintech founder community was still dominated by men, with women making up just 7% of the total pool.
Africa.
MarketForce, a retail B2B and end-to-end distribution platform founded in Africa, raised $40 million in Series A funding. MarketForce, which was launched in Uganda, Tanzania and Rwanda last year, plans to introduce buy now, pay later (BNPL) options to help merchants access fast moving consumer goods on credit. Annie reported that it plans to enter additional markets in East and West Africa.
Asia.
India's Niyo raised $100 million in a new financing round as the consumer-facing neobank platform looks to add lending and insurance to its offerings and make deeper inroads in the world's second largest internet market. According to our man on the ground in the country, Lightrock India co-led the Bengaluru-headquartered startup's Series C financing round.
PayMongo, a Philippines-based fintech that enables merchants to accept digital payments, raised $31 million in Series B funding. Catherine Shu writes that investors include the JAM Fund, ICCP-SBI Venture Partners, and Lisa Gokongwei.
Europe.
The $10 million seed funding round was co-led by WndrCo and Runa Capital. The startup came from Spain.
Latin America.
Leasy is the image.
Leasy secured $2 million in equity and 15 million in debt to fund its operations. I talked to the company's founders, who hail from Italy and Spain, and they said their goal with the startup is to help break the cycle of poverty for some of the unbanked in Latin America. The company says it has been profitable since it was founded. They plan to use their new capital to expand to Mexico.
The United States.
Over the course of the next two years, Promise has seen enormous growth and raised a $25 million B round to keep going. I like this idea.
E mber, a Salt Lake City-based proptech company, raised $17.4 million in a financing that was led by Peter Thiel. The goal of the startup is to develop a streamlined technology platform for buying and owning luxury vacation property.
In its first year of operation, Pacaso generated nearly $300 million in revenue and sold over one million units. We reported in September that the company had raised $125 million at a valuation of over $1 billion.
Down in Tampa, where it is likely to be warmer than Austin, a startup called Funnel Leasing announced a $36.5 million Series B. The property management software company called the round, which was led by RET Ventures, started as an apartment marketing platform in 2010 but has since expanded its focus.
FeeX, a New York-based fintech that aims to help financial advisors manage their clients' retirement accounts and other held away assets, announced last week that it had raised $80 million across three recent funding rounds.
Skipify, a startup that lets merchants offer instant checkouts on their websites, apps and marketing channels, received a strategic investment round from PayPal. Skipify said that this round, in addition to its recent Series A co-led by Flourish Venture and Point72 Venture, follows its partnership with Google to enable shopping and interactive features inside the email channel.
The news this past week was not all good.
In response to rapid revenue growth and improving economics, the company saw its value drop 9% in regular trading after falling sharply in recent sessions. Nu was worth just $8 per share as of mid-week, and was officially underwater from its IPO price and down about a third from its all-time highs. According to Forbes, publicly traded fintech stocks have fallen by 40% since late October.
Nu is not alone in its struggles. According to Forbes, Chime is postponing its IPO until the second half of the year.
The Bengaluru, India-based startup is said to have laid off around 40 employees, as reported by VCCircle this past week.
One has to wonder if investors will be more cautious than they were last year when they were throwing money at companies in the space hoping to be backing the next big thing.
The amount of capital for startups in the space continues to grow despite some recent bumps.
i80 Group, an investment firm that provides credit to growth and venture-backed companies, announced a multi-year fund commitment from ICONIQ Capital. The amount of the investment was not disclosed. i80 told me last year that it had committed more than $1 billion to over 15 companies, including a real estate marketplace and a finance app.
Wilshire Lane Capital founder and managing partner Adam Demuyakor is pictured.
Wilshire Lane Capital, which invested in the Pinata, received 40 million in commitments with the first close of its debut fund. The firm's latest fund is focused on investments in early-stage proptech companies. Wilshire Lane Capital is a Black-owned VC firm, which we simply need more of, and more than 80% of its portfolio companies have a founding member or management team with at least one woman.
Personal finance company Sofi revealed it was acquiring banking-software maker Technisys in an all-stock deal worth over $1 billion. The company's stock dropped about 8% after the announcement after already falling by more than 30% since the beginning of the year. My friend The Financial Revolutionist wonders if the company is biting off more than it can because of the acquisition, which appears to be symbolic of the company's intent to transition from its original focus on student debt to more of a one-stop shop.
I made a point at the beginning of this column. There are more and more fintechs going horizontal. It is a risk worth taking. Not all. Time will tell which companies will emerge better.
Take care and be safe.
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