European FinTech deals this week include Leatherback, Zevoy, Stenn,Wagestream and Capital on Tap
We feature Q&As with Paul Christensen of Previse and Spiros Margaris of Margaris Ventures
Scaling Enterprise FinTech: with Paul Christensen of Previse
1. Tell us a bit about yourself and your company
I have a bit of an unusual background, having been born on a piece of tin in the jungle of Papua New Guinea. Respect to my mother, who is an inspiration! I’m a fintech nut. I’ve been in fintech for 25 years, having been part of the founding team of Volbroker.com in the late nineties. I then spent time in several banks, including a decade at Goldman where I led their strategic investments and corporate venturing team. But I knew that I wanted to get back to building and creating. So I started on a quest, with my amazing co-founders (Andre, Giulio and Philipp) and our team, to fix B2B payments.
Our company is a data science firm, on a mission to instantly pay the world’s millions of small sellers, so that they don’t have to wait and chase for weeks and months to get paid. Our purpose is to unleash the power of data for business.
7 Questions with Spiros Margaris, Margaris Ventures
1. Please tell us a bit about yourself, both at work and leisure.
My name is Spiros Margaris, and I am a venture capitalist (VC) and the founder of Margaris Ventures. I have been in the investment business for quite some time, with more than 25 years of international experience in investment management/research and startups. In my role as a VC, I also act as an advisor to my globally spread FinTech and InsurTech startup portfolio. I am the first international influencer to achieve ‘The Triple Crown’ of influencer rankings by being ranked the global No. 1 FinTech, artificial intelligence (AI) and blockchain influencer by Onalytica in 2018. I am very fortunate to regularly appear in the top three positions of the established global industry influencer rankings due to the generous support of great FinTech industry friends and participants. In 2017, I had the opportunity to give a speech at the TEDxAcademy Talk. In addition, for the enterprise software vendor SAP, I wrote an AI white paper, ‘Machine learning in financial services: Changing the rules of the game’.
UK fintech startup Leatherback raises $10M for its cross-border payments led by ZedCrest
Immigrants, international students, and the migrant population in general all require international payments, or foreign exchange. Revolut and Wise are among those platforms to have taken advantage of this international audience. Now, fintech startup Leatherback, a U.K.-based cross-border payments platform, has raised what it describes as a $10 million pre-seed round led by ZedCrest Capital, a pan-African investment firm.
Leatherback offers a multiple currency solution for cross-border transactions.
Co-founder and CEO Ibrahim Toyeeb said in a statement that the funding would “be deployed to raise Leatherback’s profile in the Fintech arena as well as extend its capacity in the many countries it’s licensed in and where it is about to be approved. These include South Africa, Egypt, Uganda, India, and the UAE.”
Prior to this round, the company said it was bootstrapped by the founders.
“As principal investors, we love opportunities where we can bring our expertise to bear,” Zedcrest Capital’s group managing director, Adedayo Amzat, said. “It has been rewarding to provide operational and strategic support to Leatherback in its quest to build the perfect compliance, technology, and finance infrastructure that will allow it to be the operating system of choice for the global mobility of businesses and individuals.”
U.K.-based Leatherback offers multi-currency accounts with the option to exchange currency across multiple countries, including the United Kingdom, Canada, India, Nigeria, Egypt, Uganda, Tanzania, Angola, South Africa, the UAE, Denmark, Ghana, and Côte d’Ivoire.
Finnish FinTech Zevoy Raises $16M to Roll Out Across Europe
The cash will be used to launch in eight European markets during the next few months.
This round was led by Blossom Capital, the London-based venture capital company, alongside European investors Maki.vc and Brightly Ventures.
Founded in the summer of 2020, Zevoy offers an expense management solution, as well as credit and prepaid debit, to its clients.
Zevoy is expected to secure a credit institution license this year, which will allow the firm to accept deposits.
“Expense management is a big pain point for many companies and their employees,” said CEO Christoffer Rosqvist in a statement. “To solve this, Zevoy offers an all-in-one business card with which you can scan receipts, match purchases with receipts, manage and forward expenses digitally into accounting.”
Zevoy focuses on underserved markets and growing companies have proven to be a sweet spot, he added.
Last month, PYMNTS reported that the while Nordic region may be small, with a population fewer than 6 million in Norway, Denmark and Finland, they are global leaders in innovation.
London-based fintech Stenn raises $50M on a $900M valuation for its platform that helps SMEs access supply chain finance
Stenn, a global non-bank trade finance provider, has raised $50M (approximately €46M) at a valuation of $900M (approximately €832M). With globalisation at the centre of every major change in the economy, Stenn offers a platform that helps players in this globalisation drive gain access to financing.
The past few years have seen globalisation reach a fever pitch where every company now operates across borders and in order to keep up with this change, the manufacturing and logistics sector has also evolved. While it is easier for product companies to raise capital, Stenn has built a platform that helps players in the supply chain get access to capital.
A research from Accenture shows that SMEs currently face a global financing gap of $3.6T. This gap is expected to rise to $6.1T within the next three years. With SMEs responsible for more than a quarter of global trade, the research shows that these businesses have struggled to access financing despite their major role in global trade.
The lack of access to easy financing has restricted the growth potential of these small and medium enterprises. Stenn was founded in 2015 to solve this very problem and has provided over $6B of financing to SMEs in over 70 countries since its inception. It has helped SMEs from sectors such as retail and IT services to access financing, and its platform has financed over $1B of transactions to date in 2022.
“A lack of access to finance is stunting the growth of SMEs around the world that are engaged in international trade. At Stenn, our purpose has always been to level the playing field for global SMEs, helping to plug a multi-trillion-dollar financing gap by connecting these businesses with low-cost institutional capital,” founder and CEO Greg Karpovsky says.
Wagestream Raises $175M in Series C Funding
Wagestream, a London, UK-based provider of a financial wellbeing app, raised $175M in Series C funding.
The round was led by Smash Capital, with participation from Epic Games, Reddit, SonderMind, and DuckDuckGo, with participation from BlackRock, Balderton Capital, Northzone, Fair By Design, and Silicon Valley Bank.
The company intends to use the funds to scale up its presence in new markets such as the U.S.
Founded in 2018 by Peter Briffett (CEO), Portman Wills (CTO) and a group of leading financial charities, including Joseph Rowntree Foundation, Barrow Cadbury Trust, Social Tech Trust, Big Society Capital, and the Fair By Design fund, Wagestream is a financial wellbeing app designed for frontline workers and built around their pay. Offered through caring employers, it makes work more inclusive, fair and rewarding for people – by giving them access to fair financial services built around flexible pay.
Workers access Wagestream through participating employers, who subsidize the service. The app syncs with payroll systems and allows employees to access and manage their income – either directly through the app, or as an integration with workforce management technology partners. Additionally, the app provides users with a variety of financial services to help them build up their financial health over time. For example, people can choose how often they’re paid, track their shifts and pay each day, build savings and win prizes, access free financial coaching, and get fairer deals on products – like insurance and utilities – than they would have access to elsewhere.
More than one million workers in industries such as retail, hospitality and healthcare are currently able to use the app through employers including Burger King, Pizza Hut, Crate & Barrel, Bupa and the UK’s National Health Service. One million workers now can access Wagestream globally through over 300 employers in the U.S., UK, Spain and Australia.
Fintech turns on capital taps with $200m funding for US expansion
London-based fintech Capital on Tap has secured a $200m (£153.6m) investment from HSBC and Värde Partners to continue expanding its SME funding service in the US.
Founded in 2012, Capital on Tap provides business credit cards that come with spending controls, reporting and rewards.
The alternative lender initially focused on the UK market but launched a US business credit card in March 2021.
Across both markets, it has provided more than £3.5bn in funding to over 125,000 SMEs. It provides a credit facility of up to £150,000 and doesn’t charge for ATM use in the UK.
Capital on Tap’s market includes businesses with a turnover of at least £2,000 per month.
As part of its move into the US market, Capital on Tap established an office in Atlanta, adding to its presence in London and Cardiff.
The fintech company has 50 people at its Atlanta office and will use the fresh investment to increase hiring.
Alan Hart, CFO, Capital on Tap, said: “With the closing of this facility we are looking forward to expanding our ability to provide essential funding for small businesses across the United States. We are thrilled to be joined in this mission with Värde Partners as well as extending our already international relationship with HSBC.”
The latest investment follows a £450m funding facility closed in November last year, which also saw HSBC provide capital.
“We see this as a good example of an emerging substantial investable opportunity set for us, providing capital solutions to digitally-oriented non-bank lenders that are financing the needs of businesses investing in their products and customers,” said Aneek Mamik, partner and global co-head of financial services at Värde Partners.
Capital on Tap’s latest funding follows a bumper 2021 for UK fintech investment, with companies raising $11.6bn in capital.
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