Fintech Update, 1/22 - 1/28

Jan 29, 2024

Hi! It’s Monday, January 29th, 2024

Klarna announced a subscription plan called “Klarna Plus.” Users who subscribe will pay $7.99 per month for added benefits “like no added service fees when using Klarna’s One Time Card, double rewards points and access to exclusive discounts with popular brands.” Sound familiar? Last September, we wrote about how code hidden in Affirm’s iPhone app indicated that the BNPL startup was exploring a subscription offering. There’s no update on Affirm’s subscription product but our take is that both BNPLs are clearly experimenting ways to bolster their recurring revenue, especially Klarna as they appear to be gearing up for an IPO (“very likely…quite soon”).

Brex laid off 282 employees, some 20% of its staff. The layoffs come after a report from The Information “that the company reportedly told employees that it burned $17 million a month in the fourth quarter of 2023 and that it only had ‘enough cash to last through March 2026.’”

Revolut launched “Mobile Wallets,” allowing users to send money internationally with only a recipient’s name and phone number or email address. Definitely low-friction…

PayPal’s new CEO Alex Chriss claimed its ‘Innovation Day’ would “shock the world.” Investors thought otherwise, sending shares in payments giant down 4% on Thursday. It turns out the market actually expects the company to deliver product enhancements like AI-driven features and faster checkout experiences.

What took so long? Embattled crypto firm Terraform Labs, behind the failed stablecoin TerraUSD, filed for bankruptcy in Delaware. The company and ex-fugitive CEO Do Kwon (who’s currently imprisoned in Montenegro) are facing legal action in the US and Singapore related to the multi-billion dollar collapse of TerraUSD and its associated token, Luna, in May of 2022.

Matt Brown wrote a great piece called “Dark Software” about how SaaS and fintech models are breaking down, why food delivery and dark kitchens provide an alternative model, and what the future of software may look like as a result.

Bilt, the company that helps renters earn points on rent, raised $200 million in a new funding round led by General Catalyst at a $3.1 billion valuation. According to the TC article on the fundraising, Bilt’s users cover 4 million units, member spend is “nearing $20 billion,” and the company “achieved EBITDA profitability in 2023.”
User management and authentication platform Clerk raised $30 million in a Series B funding round led by CRV with participation from Stripe and a16z.
ModernFi, the interbank solution that allows banks to exchange deposits on demand via a tech-enabled marketplace, raised $18.7 million in a Series A funding round led by Canapi Ventures.
Israeli personal financial startup Sequence raised $5.5 million in seed funding.
Alinea Invest, the investing app for Gen Z women, raised $3.4 million in seed funding.