Fintech Update, 4/12 - 4/18
Hi! It’s Monday, April 19, 2021.
Leading Off
This week poured even more gas on a bonfire of recent fintech exits, as Coinbase hit a market cap of over $80B in its successful direct listing, Grab announced it would go public in the largest SPAC merger ever, and Blend confidentially filed with the SEC to IPO later in the year. // Meanwhile, the Massachusetts state securities regulator upped its pressure on Robinhood; the NYSE launched “First Trade” NFTs for several tech companies that recently went public; small businesses in need of PPP funds were left hanging out to dry as American Express purchased online lender Kabbage; and N26 launched an insurance product. // In other news, JPMorgan is testing the use of blockchain technology to improve global transfers, Keybank launched a digital bank for doctors, and Dogecoin’s price surged. // All this + more below!
Heavy Hitters
At the moment, there’s no wrong way to take a fintech public. Fintech exits, and fintech-related froth in the market, showed no signs of abating last week as a few big names made big public debuts or announcements of upcoming debuts:
Coinbase successfully direct listed. The crypto exchange opened on the Nasdaq exchange at $381/share and closed its first day at $328.28/share (implying a $62 billion market cap), about 31% about its $250/share reference price. At one point on opening day, the stock shot up as high as $429.54/share. Coinbase has emerged as the most popular U.S. crypto exchange and has largely benefited from the massive increase in digital currency trading volumes and activity.
Grab plans for a marquee SPAC merger. The Southeast Asian ride-hailing giant, which has also built a suit of financial products and services, announced that it is set to go public through a SPAC merger with Altimeter Growth Corp. The SPAC will value Grab at $39.6 billion, making it the largest blank-check merger to date.
Blend filed with the SEC to go public. The digital lending platform confidentially filed with the SEC to go public via IPO, submitting its draft registration statement with the regulator.
Quick Takes
Massachusetts comes after Robinhood’s brokah-dealah license. The Massachusetts Securities Division filed to revoke the digital brokerage’s state broker-dealer license, escalating its months-long battle against the firm for “entic[ing] and induc[ing] inexperienced customers into risky trading.” Robinhood responded by filing an injunction, retorting that the state’s complaint “reflects the old way of thinking.”
NYSE launches First Trade NFTs. The New York Stock Exchange announced that it is planning to launch First Trade NFTs to memorialize the first trade of stocks on the public market for the following companies: Spotify, Snowflake, Unity, DoorDash, Roblox, and Coupang.
Amex’s acquisition of Kabbage hurt PPP borrowers. CNBC looks at how Amex’s acquisition of Kabbage, which did not include the online lender’s loan portfolio, left existing borrowers with an entirely different servicing operation. K Servicing, the orphaned division, has frustrated customers concerned about losing their PPP loans.
Ant Group bows to central bank pressure. Following immense regulatory pressure, the Chinese fintech giant will apply to become a financial holding company overseen by the People’s Bank of China. The classification will submit Ant to regulations similar to those governing banks.
N26 is getting into the insurance game. The German digital bank partnered with insurance firm Simpleinsurance to offer German customers “insurance straight from the N26 mobile or desktop apps to cover accidents, damage, and theft of their device.”
MoneyLion rolls out digital currency transactions. Digital financial platform MoneyLion announced that it will empower members to buy, sell, and earn digital currencies and has made a strategic investment in Zero Hash, the digital asset settlement provider.
Pop Flies
JPMorgan and several Taiwanese banks are working together to test whether a blockchain application can be used to improve global funds transfers.
KeyBank is launching a digital bank that will aim to cater to the needs of physicians and dentists.
The WSJ published new insight into Stripe’s impressive company financials.
Robinhood experienced issues with crypto trading, frustrating investors looking to capitalize on last week’s surge in the value of Dogecoin.
Fundings!
Lending
Mexican BNPL provider Nelo raised $3 million in seed funding.
Numida, the African fintech that is working to provide financing to small African businesses, raised $2.4 million in seed funding.
Banking
Neobank for SMBs Hatch raised $20 million in new funding.
African BaaS provider Appzone raised $10 million in Series A funding.
Payments
Indian payments firm Razorpay raised a $160 million Series E round at a $3 billion valuation, tripling its value from last year, when it raised a $100 million Series D.
B2B payments-based platform Routable raised $30 million in Series B funding.
Infrastructure
Employment and income verification infrastructure software solution provider Wage (recently rebranded from Verix) raised $5 million in a seed funding round led by Google’s AI-focused venture fund.
Insurtech
Employer-sponsored insurance firm Level raised $27 million in Series A funding led by Khosla and Lightspeed, valuing the company at an undisclosed “nine-figure” valuation.