[podcast] Investing in growth-stage fintech with Long Ridge’s Kevin Bhatt
The Startups: Who’s shaking things up (Week ending February 7, 2016)
[alert type=yellow ]Every week, Tradestreaming highlights startups in the news, making things happen. The following is just part of this week’s news roundup. You can get these updates delivered direct to your inbox by signing up for the Tradestreaming newsletters.[/alert]
Startups raising/Investors investing
TradeRocket inks deal with Hitachi Capital America to fund $2 billion for mid-market financial supply chain (PRNewswire)
Hitachi Capital intends to supply $2 billion this year for TradeRocket’s supply chain financing platform which allows buyers to attain up to $5m of funding.
Credibly secures $70 million credit facility led by SunTrust Bank (VentureBeat)
An online lending platform that delivers a broad range of short- and long-term capital to satisfy the SMB credit spectrum, Credibly has provided access to capital for more than 4,500 businesses.
Rocket Internet’s Spotcap raises €31.5m to lend to small businesses (TechCrunch)
Spotcap intends to use the funds to expand its operations globally and to finance its online business lending activities in Spain, the Netherlands, and Australia.
Simplex raises $7m for credit card Bitcoin buying service (CoinDesk)
Simplex CEO Nimrod Lehavi said that the company enables faster purchases of bitcoin via credit card, while at the same time reducing the consequences of fraud for businesses, such as exchanges or brokerages, that offer the service.
Revolut passes $200m in transactions; closes $4.8m seed round (Finextra)
Revolut, the MasterCard-connected Global Money App, today announces it has closed its seed round adding Index Ventures as an investor.
Dopay, payroll for the unbanked, raises $2.5 million in pre-Series A round (PEHub)
From the PR: dopay is committed to transforming the lives of the unbanked and their employers by breaking the cash cycle through a payroll and cash management platform for companies, and by offering a full mobile banking experience for consumers
The Startups: Who’s shaking things up
How a Snapchat roboadvisor could rock the industry (Wealth Management Today)
Social media messaging service Snapchat is rumored to be building a roboadvisor service of its own. Could this be a serious option for 100 million active users?
How Payoff is shifting the conversation about consumer debt to financial wellness (Tradestreaming)
Payoff seems to be genuinely interested in helping its clients find their way out of debt and start saving. Pretty weird for a company that extends credit.
Opportunities in the risk business abound as insurance ready for disruption (TechCrunch)
From TechCrunch: “At a time when nearly every product category has been reimagined by a higher quality digital successor — the insurance industry and customer have been left in the dust.”
Navigating the fintech investment landscape (Wharton Fintech)
Nikhil Srivastava interviews Atul Joshi, a Wharton alumnus and managing partner of the family office Raga Partners, about fintech investment.
Ten reasons why fintech startups fail (CB Insights)
Pascal Bouvier, venture partner with Santander InnoVentures, lays down the law and explains who will win and who won’t.
BlackRock’s FutureAdvisor collaborating with RBC Wealth Management (Finovate)
The U.S. branch of RBC Wealth Management is launching a pilot program called RBC Investor Gateway that offers clients a digital advice option powered by FutureAdvisor
Blockstream partners with PwC for blockchain push (American Banker)
PricewaterhouseCoopers has partnered with blockchain technology company Blockstream to bring distributed-ledger and smart-contract technology to its clients
The most interesting challenger bank you’ve never heard of (Huy Nguyen Trieu)
From zero to 200,000 accounts in less than 2 years, this startup bank is trying to do what Easyjet and Ryanair did to airlines…
5 trends we’re watching this week
[alert type=yellow ]Every week at Tradestreaming, we’re tracking and analyzing the top trends impacting the finance industry. The following is a list of important things going on we think are worth paying attention to. For more in depth trendfollowing, subscribe to Tradestreaming’s newsletter .[/alert]
- More banks sign up for SWIFT nascent payment tech initiative (PYMNTS)
- DTCC wants to coordinate industry activity on distributed ledger tech (Finextra)
- Why bank fintech accelerators are destined to die (American Banker)
- Is VC the right money for fintech? (TechCrunch)
- What Bank of America’s race to cardless ATMs says about the future of banking (Tradestreaming)
Who are the best investors in fintech startups?
Been talking a lot to entrepreneurs in the space. I get a chance to hear their perspectives on their financial backers, investors with an eye to the future of financial services.
Here’s the beginning of a list of some of the best VCs in fintech. Who do you think belongs on there?
Investing at the intersection of technology and social media (The Future of Investing)
This post was originally included as part of an ebook that I published alongside the launch of my book, Tradestream, entitled “Tradestreaming and the Future of Investing”. The content was so good I wanted everyone to have access to it 
. This is a great one from thought-leader and investor, Roger Ehrenberg about the opportunities for new tech and startups at the crossroads of technology, social media and finance.
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The real-time Internet is providing investors with actionable insights and information previously unimaginable. Technological innovation – distributed processing and massive storage through cloud computing – has played a significant role in this transformation. However, it is at the intersection of technology and social media where the greatest innovation has taken place. Thought-leaders across all domains, including finance, investing, economics and trading, have increasingly been sharing their views on the Internet. And a new class of companies have emerged to harvest, index, curate and disseminate these valuable insights. But more importantly, these companies have facilitated conversations between thought-leaders and members of the community. And it is in this dialogue where the greatest value is created. These changes impact not only investors, but producers and consumers of media everywhere. Trusted perspectives are being turned into actionable insights in real-time, with the judge of quality being crowd-sourced. Is this story important or merely noise? Is this unusual options activity truly predictive of earnings out-performance or simply a statistical artifact? Is this analysts’ off-consensus iPad shipment estimates based upon better insights or a flawed understanding? Innovative companies have helped to identify high-value individuals to serve as catalysts for discussion, but trust, reputation and status must be earned by community leaders and members alike every day. And it is the judgment of community that will ultimately determine a person’s influence within the community. And this can only happen through today’s cutting-edge technology, innovations in how social media and online communities are built and curated and the increasing volume of high-quality content. When it comes to investing and the impact of technology and social media, what seemed like the future is accessible today.
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Roger Ehrenberg (LinkedIn) is Managing Partner of IA Ventures, a seed-stage technology fund focused on “big data” tools and technologies. Mr. Ehrenberg has an array of investments across financial technology and social media including Stocktwits, Covestor, Selerity, bit.ly, Buddy Media, TweetDeck and TLISTS.
Peer to peer, financial style (Future of Investing series)
This post was originally included as part of an ebook that I published alongside the launch of my book, Tradestream, entitled “Tradestreaming and the Future of Investing”. The content was so good I wanted everyone to have access to it 🙂 .
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What has the financial crisis taught us? What’s changed in our risk management? Our models? Nothing. Nada. The government pumped millions into the same old banks and financial institutions, practicing the business the same old way, with the same people. Frankly, politics changed more in the last 4 years than the supposedly technologically-advanced financial industry. Obama rose to power using social networks, the power of
change and the power of the people but applied none of that to fixing the financial system. We need to use the advances in the internet, mobile, social networking and the rise of the real time web to fundamentally change the financial industry, creating more democratization, transparency, opportunity with improved risk management.
As peer to peer lending takes off, we can imagine a world where this model is extended to everything from mortgages to currency trading. Your local mortgage provider of the 1950s, who knew your employer, your neighbors and the intricacies of your local housing market so he understood the risks was replaced by abstract CDOs with zero risk-correlation to the facts of your housing markets. Those CDOs will be replaced by Facebook and your social network who will understand your risk profile better than anyone? Why can’t corporations lend money directly off their balance sheets in real time instead of depositing them in banks, earning low interest and enabling the banks to give out risky loans at a higher rate? That is certainly inefficient and screaming for disintermediation.
As I write these lines, I am reading about yesterday’s IPO of Financial Engines (Nasdaq FNGN), who uses technology and the internet to democratize the provision of financial advice to the “common man” and is up over 40% in its first day of trading. I read the FNGN article on Seeking Alpha who “gives a voice to 3000 contributors” who talk to any investor on the web about the stocks they own. Enough writing, I think I will go make a loan on Zopa, buy some Israel Shekels on eToro.com and tweet about it later.
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Michael Eisenberg is a partner at Benchmark Capital and has been a key figure in Internet and software investing in Israel since 1995. Prior to joining Benchmark, Michael was a partner at Israel Seed Partners for eight years. Michael joined Israel Seed in 1997 from Jerusalem Global, where he started and headed the firm’s successful investment banking group and partnership with Montgomery Securities.