Fintech Update, 7/13 - 7/19
Hi! It’s Monday, July 20, 2020.
On this day in 1969, Apollo 11 astronauts Neil Armstrong and Edwin “Buzz” Aldrin became the first men to walk on the moon. (Meanwhile, back in 2020, it feels like a feat just stepping out of the house 😫) We hope you get to do some exploring today!
Leading Off
Robinhood kept its strong 2020 going, pulling in another $320M, bringing its total funding raised in the last three months up to $600M and giving it an $8.6B valuation. // nCino, the super-hyped maker of bank operating system software, debuted on the Nasdaq exchange and finished its first week of trading with a share price more than double its self-assessed opening price. // And in other news: HSBC is working with AWS to handle its global cloud services; Wirecard’s hits just keep coming; Revolut is working with Paxos to offer crypto trading for U.S. users; Barclays is getting into the digital wealth management game; and Hummingbird Regtech raised $8.2 million in Series A funding. // All this + more below!
Heavy Hitters
Robinhood raises additional $320M. After announcing $280 million in funding in May, Robinhood announced that it has raised an additional $320 million, or $600 million total in the past three months. The investment and financial management tool has received significant public attention recently, with tens of thousands of amateur investors signing up for the platform to capitalize on the ongoing market volatility, in addition to some scrutiny for its role in the tragic suicide of a 20-year-old day trader in June. Robinhood’s valuation is now $8.6 billion.
nCino soars, returns to stratosphere in first week of trading. After pricing itself at $31/share, the provider of bank operating system software made its Nasdaq debut at $71/share and closed its first day of trading at $91.70/share, about ~195% higher than its initial pricing. In the following days, nCino scuffled a bit, returning back to its debut pricing and closed the week at $73.30, about 3.5% above its $71 debut price. nCino’s initial surge bears some similarities to fintech’s other recent mega-IPO by insuretech firm Lemonade in June, which also experienced massive gains during trading hours after pricing itself at a relatively modest $29/share. With markets in turmoil and persistently low interest rates on savings and CDs, many investors are turning to buzzy tech stocks to help grow their portfolios.
Quick Takes
HSBC picks AWS for cloud services. The bank selected Amazon Web Services as its long-term strategic cloud provider, with the two parties signing a multiyear agreement to help HSBC drive its digital transformation and offer new and more personalized banking services.
Wirecard exaggerated partnerships. The WSJ reached out to hundreds of companies with which Wirecard claimed to have partnerships, finding that many of the supposed agreements were not formally executed. “If you’re just . . . look[ing] at headlines, you’ll say ‘oh that’s pretty impressive’ . . . [But] if you looked at the details, you’d realize it was absolutely meaningless,” commented one analyst.
Revolut partners with Paxos for U.S. cryptotrading. The challenger bank is now offering U.S. users the ability to trade cryptocurrencies through a partnership with blockchain startup Paxos. Having launched in the U.S. in March, Revolut now is looking to build out its product lineup to better align its U.S. services with those of its European business.
Monzo rolls out “Plus” account… for the third time. The British challenger bank is re-launching Monzo Plus for the third time, after scrapping the first two iterations due to low consumer adoption. The new version offers a variety of features for £5 per month, including “third-party bank account aggregation, virtual debit cards, . . . [and] interest on . . . balances of up to £2,000.”
Lemonade launches insurance for our furry friends (🐶&🐱). The insurtech firm, riding a wave of publicity in the wake of its successful IPO, launched a new pet insurance product for cats and dogs. It’s Lemonade’s first “new vertical” since launching its renters and homeowners insurance product in 2016.
Privacy.com raises $10.2M. The virtual card payments startup, which allows users to generate virtual and disposable payment card numbers for free, raised $10.2 million in a Series A funding round.
SoFi has increased users 300% so far in 2020.CEO Anthony Noto shared that this company’s total users have nearly tripled since January, and that daily trading volumes are up over 300%.
Barclays launches digital wealth management service. The British bank introduced a digital investment service for current account customers called Barclays Plan & Invest offering “a personalised investment plan . . . tailored to a customer’s goals” for users with a minimum of £5000 to invest.
Pop Flies
Plaid and MuleSoft launched “Plaid Exchange,” a new, API-based open finance platform.
Ant Group said it hit 1.3 billion annual active users, amid rumors of an imminent IPO.
Forbes spoke with Klarna’s CEO about the firm’s evolution into a B2C shopping platform.
Bond, a firm building APIs to connect banks and tech firms, announced a $32 million Series A.
Google said it plans to invest $10 billion in India across a variety of fintech opportunities.
Regtech firm Hummingbird raised $8.2 million in Series A funding.