CyberTech ventures, Deadpool-backed enterprises and InsurTech startups are among the crème de la crème of the 25 FinTech funding rounds reported last week.
Last week, we reported on 25 FinTechs who successfully raised money, which included one backed by a superhero. Companies operating in the WealthTech, cybersecurity, RegTech, anti-fraud, InsurTech and lending segments of the FinTech industry raised money over the course of last week.
While Wealthsimple’s massive $610m round may have secured the most headlines last week, InsurTech and CyberTech ventures bagged the most capital injections.
Before we delve into the subsectors, let’s start with the biggest round, which was bagged by Australia-based Athena Home Loans. The company inked a funding deal worth $1.5bn with global alternative investment group Cerberus and its non-bank lender subsidiary Bluestone, making it its second whole-loan funding arrangement in the last six months. The funds, which will be deployed over the course of the next three years, will be used by the online home loan company to help customers get financing quicker and pay it off faster.
The main winner from last week was the star-studded round raised by investment and brokerage manager Wealthsimple which pushed its valuation to $5bn. Led by Meritech and Greylock, the $610m fundraise saw investors including Canadian rapper Drake, Ryan Reynolds a.k.a Deadpool himself, Michael J. Fox, NBA players Kelly Olynyk and Dwight Powell and NHL all-star Patrick Marleau pump in their dosh. The Toronto-based company plans to continue to maintain its position as a leader in democratising financial products for consumers, including stock trading, crypto-asset sales and peer-to-peer money transfers.
Welathismple wasn’t the only firm to attract celebrities. Smart loan provider LoanSnap hauled in fresh cash injection in its Series B from MANTIS Venture capital, the investment group founded by Grammy Award-winning pop duo, The Chainsmokers.
This is the second consecutive week of celebrities backing FinTech startups. Last week, FinTech Global reported about teen banking platform Step scoring $100m from a slew of well-known names including Suicide Squad’s Joker Jared Leto, TikTok star Charli D’Amelio, Will Smith, Jeffrey Katzenberg, NBA All-Star Stephen Curry and The Chainsmokers alongside other investors.
Of course, Ryan Reynolds and Jared Leto are hardly alone in being the only celebrities backing startups. Ashton Kutcher’s Sound Ventures has backed rounds supporting businesses like Cedar and brigit. Furthermore, Iron Man himself funded Aspiration via his Footprint Coalition Ventures, an investment company designed to help tech companies protect the environment.
Alongside celeb investors, 1.5 million users and over $10bn in assets under management, Wealthsimple places further confidence in the WealthTech sector which has experienced significant growth during the pandemic.
Other WealthTech startups which also secured new capital investment last week included Nivesh, Bibit.id, newly turned unicorn HoneyBook and Stockal. These rounds come after the global WealthTech sector recorded another record year in 2020 in terms of investment raised despite the coronavirus chaos.
For one thing, FinTech Global unveiled the 100 most innovative companies in the sector around the world by announcing the ventures named on this year’s WealthTech100 list. You can find the full third annual list here.
WealthTech companies raised over $9.2bn last year, a 9.6% year-on-year growth. At the same time deal activity also increased in 2020 with 443 deals being completed compared to 388 transactions in 2019, according to FinTech Global’s research. That is up considerably from 2016 when the global WealthTech sector raised $2.8bn across 314 rounds in total. In specific, the global online investment platform market size which was $1.1bn in 2020, is expected to reach almost $5bn by 2028, according to ReportsandData.
Moving over to the CyberTech sector which saw startups such as JupitorOne, Persona, Acronis, Shift Technology which earned its horn, Huntress, Cymulate, Syxsense and Vanta cash in massive rounds last week.
Overall, the cybersecurity space has flourished as bad actors have increased their digital assaults and businesses have beefed up their security infrastructures.
However, there were temporary signs that the cybersecurity boom may be cooling down as the sector only reached $700m in the second quarter of 2020, representing a decline of over 60% from the first three months of last year, according to FinTech Global’s research. However, by the end of the year, the sector set a new record as CyberTech companies bagged a total of $6.2bn across 354 transactions – up from $4.7bn in 2019.
That being said, the sector is expected to grow further over the next few years. In fact, the global industrial cybersecurity market size is expected to reach $22.8bn by 2026, according to recent Reportlinker.com research. In fact, a third of US-based bankers believe cybersecurity will continue to be one of their top priorities in 2021 as they continue to digitalise their offering. Last week, the company powering internet services for Belgium’s parliament, government departments, universities and scientific institutions suffered a massive cyberattack proving that no one is immune to online threats.
Another sector witnessing continued growth was the InsurTech sector with a smattering of companies scoring investment including Lami, Relay Platform, Sprout.ai and Headway. Last week’s funding rounds are testament that the global InsurTech market will continue to enjoy a record year this year after it did in 2020.
The InsurTech segment raised $6.2bn across 323 deals last year, according to FinTech Global’s research. Furthermore, it is expected to be worth $16.8bn by 2025 months after the sector enjoyed its best year yet, according to research from million Insights. The key reason for that has been the escalating demand for new technologies such as AI and machine learning and their adoption by insurers.
Now, let’s look closer at the 25 FinTech funding rounds we reported on in the last week.
Athena Home Loans closes $1.5bn in debt funding
Online mortgage marketplace Athena Home Loans reportedly collected $1.5bn in funding from Cerberus which will supply the funds over the course of the next three years.
This funding comes just six months after it closed a $235m investment from Newcastle Permanent Building Society.
Drake and the merc with the mouth back Wealthsimple’s $610m round
The Toronto-based WealthTech firm more than tripled its valuation to circa $5bn after its $610m round led by Meritech and Greylock included funding from Inovia, Sagard and Redpoint, Two Sigma Ventures, TCV, as well as stars like Drake, Ryan Reynolds and Michael J. Fox.
It’s worth noting that Meritech has also invested in success stories such as Salesforce, Nextdoor, Zulily and Lime while Greylock has backed Airbnb, LinkedIn, Coinbase and Discord.
With this funding, Wealthsimple plans to expand its market position, build out its product suite and grow its team. Along with its robo-advisor services, the company now also offers automated savings and investment products as well as tax filing tools and plans to expand its offerings to encompass even more of its customer’s financial lives when committed with fresh resources to do so.
Cyber protection provider Acronis banks $250m
Acronis, a provider of cybersecurity across data, applications and systems raised over $250m in a funding round that set a $2.5bn valuation for the Swiss company.
CVC Capital Partners led the financing, bringing total known funding to date for Acronis to more than $400m. Founded in 2003, the company says it now has more than 1,500 employees in 33 locations in 18 countries.
Shift Technology enters billion dollar club after $220m round
Fraud detection firm for InsurTechs which provides AI-powered decision automation and optimization solutions closed a Series D funding round of $220m taking its valuation to over $1bn.
Led by Advent International with help from investors that include Avenir Accel, Bessemer Venture Partners, General Catalyst and Iris Capital, this funding round brings total investment in Shift to $320m. Shift, which now serves more than 100 customers in 25 countries and has analyzed close to two billion claims, offers a suite of SaaS products to help insurers to reshape manual and often time-consuming claims processes in a more automated way.
HoneyBook passes $1bn valuation after landing $155m Series D
CA-based client experience and financial management platform for independent service-based businesses HoneyBook raised $155m in Series D equity funding.
The round was led by Durable Capital Partners with participation from Tiger Global Management, Battery Ventures, Zeev Ventures, 01 Advisors as well as existing investors Norwest Venture Partners, OurCrowd and Citi Ventures. The company intends to use the funds to advance product development and expand internal resources, which includes increasing hiring.
Ada earns the horn after netting $130m
Canada-based automated customer experience company Ada raised $130m in Series C financing.
The round, which brought total funding raised to date to $200m with a valuation of $1.2bn, was led by Spark Capital with participation from Tiger Global. Existing investors Accel, Bessemer, FirstMark, Version One and Burst.
Led by Mike Murchison, the company intends to use the funds to grow its headcount to support global expansion from a go-to-market perspective and continue innovation in R&D.
Headway reels in $70m, becomes soonicorn
InsurTech Headway secured a $70m Series B round of funding led by Andreessen Horowitz with participation from Thrive, GV, and Accel. The investment comes just six months after Headway’s Series A. The new capital brought total funding to date to $103m giving it a valuation of $750m.
The New York-based company provides free software to connect patients to therapists and therapists to insurance companies so therapists can offer more affordable care while also having an easy way to submit insurance claims online.
Bibit.id bags $65m
Robo-advisor startup in Indonesia Bibit.id raised $65m in a funding round led by Sequoia Capital India.
Prosus Ventures, Tencent and Harvard Management Company, besides existing investors AC Ventures and East Ventures also joined the round. The money will be used for the launch of new products, tech development, to acquire talents and invest heavily to increase financial education.
Persona packs in $50m
ID verification company Persona raised $50m in a Series B funding round to provide the internet’s identity layer with its selfie biometrics and other technologies. The funding round was led by Index Ventures, with participation from existing investor Coatue.
The company reported 10x revenue growth on a year-over-year basis and its headcount tripling to keep up with demand. The company also says its customer base grew by five times in the past year.
Vanta bags $50m Series A round led by Sequoia Capital
San Francisco-based cybersecurity company Vanta raised funding worth $50m in its latest Series A financing round led by Sequoia Capital and Y Combinator.
Founded back in 2017 by Christina Cacioppo and Erik Goldman, the firm that helps companies to get their ISO27001, SOC 2 and JIPA certified fast with its automated security monitoring platform.
Cymulate snags $45m to boost its cybersecurity tools
Cymulate, a provider of tools for boosting cybersecurity through simulated attacks and security tests, raised $45m in Series C funding. One Peak Partners led the financing for the Israel- and New York-based company. Existing investors Susquehanna Growth Equity, Vertex Ventures Israel, Vertex Growth and Dell Technologies Capital also participated in the round.
Founded in 2016, Cymulate has developed a comprehensive platform for organizations to validate their cyber posture continuously and on-demand by testing their cloud and on-premise networks against the latest threats.
JupiterOne banks $30m in Series B
Provider of cyber asset management and governance solutions JupiterOne raised $30m in Series B funding.
The round was led by Sapphire Ventures with participation from previous investor Bain Capital Ventures. The company intends to use the funds to grow its engineering, product development, and go-to-market capabilities, including building out its remote workforce. The funding also will be used to extend the reach of the company’s extensive partnership and integration teams.
Richard Branson and The Chainsmokers back LoanSnap’s $30m round
Smart loan provider LoanSnap raised a $30m Series B funding. The round was led by True Ventures True Select Fund IV with participation from Baseline Ventures, Richard Branson’s Virgin Group, AVANTA Ventures, ThomVest Ventures, Joe Montana’s Liquid 2, WorkPlay Ventures and MANTIS, the investment group founded by the Grammy Award-winning pop duo, The Chainsmokers. New investors LinkedIn co-founder and serial entrepreneur Reid Hoffman too joined the round.
The company intends to use the funds to further expand into new loan types and across the US. Founded by Karl Jacob, the company uses AI and proprietary technology to automate much of the loan process instead of other lenders who do it manually.
Automated spend management solution Expensya hauls in $20m
The Tunisia-based automated spend management solution for businesses raised $20m. The financing was supported by MAIF Avenir and Silicon Badia with existing investors ISAI and Seventure also contributing.
The fresh funding is expected to accelerate the company’s R&D efforts as well as increase the headcount with plans to add over 100 new faces over the course of three years. This will augment the company’s current 140 person workforce.
Railz raises $15m
Canada-based developer of an API that enables financial institutions to access to their customers’ accounting data Railz raised $12m in Series A funding.
The round was led by Nyca Partners, with participation from Susa Ventures, Vestigo Ventures, Entrée Capital Global Founders Capital, Plug and Play Ventures, N49P and Hack VC. The company intends to use the funds to continue to build its sales and engineering teams.
Coin Metrics collects $15m
MA-based provider of crypto financial intelligence solutions Coin Metrics raised $15m in Series B financing.
The round was led by Goldman Sachs with participation from existing backers Castle Island Ventures, Highland Capital Partners, Fidelity Investments, Avon Ventures, Communitas Capital, and Collab+Currency and a slew of new investors Acrew Ventures, Morningside Group, BlockFi and Warburg Serres Investments. The company intends to use the funds for global expansion, further product innovation to touch more crypto asset networks and markets.
Sprout.ai bags £8m in Series A funding
Insurtech providing an advanced claims automation solution that processes claims within 24 hours Sprout.ai raised £8m in Series A funding.
The round was led by Octopus Ventures. Other investors that participated in the round included Amadeus Capital Partners, Playfair Capital and Techstars. Sprout.ai said that it will use the funding to support its hiring efforts, grow its enterprise sales and partner networks and invest in R&D focusing on natural language processing (NLP) and optical character recognition (OCR) technology.
Fintecture collects $7.5m for its seed fund round
Paris-based payment infrastructure provider Fintecture has raised $7.5m in seed funding.
The round was led by Target Global with Samaipata and Société Générale participating. Individual investors included operators and founders of Adyen, Affirm, American Express, Facebook Payments, Google, PayPal and Snapchat.
The seed round is expected to accelerate the company’s deployment and goal of reaching 10,000 merchants as well as recruiting 30 new roles and develop new service offerings, including the increasingly popular Buy Now Pay Later capability.
Syxsense lands $6m
CA-based provider of IT and security management solutions Syxsense raised $6m in funding.
The round was led by Oquirrh Ventures and Origami Capital Partners, with participation from existing investor Signal Peak Ventures. The company intends to use the funds to continue to expand operations and its business reach.
Few¢ents inks $1.6m to help publishers take payments
Few¢ents raised $1.6m through seed funding led by Hustle Fund and M Venture Partners. Angel investors from some of the top tech including Kenneth Bishop former managing director of Southeast Asia at Facebook, Koh Boon Hwee former chairman of DBS Bank, and Jeremy Butteriss head of partnerships at Stripe, among others.
Launched in 2020 by Abhishek Dadoo and Dushyant Khare, the FinTech firm allows publishers to accept payments in instalments for their work. Its current clients include Indonesian news site DailySocial, India’s Dainik Jagran, and streaming video site Dailymotion. It has also built partnerships with Jnomics Media to grow and expand its consumer base in Europe.
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