Investing in fintech adjacencies (TWIF 2/25)
Hello Fintech Friends,
We have a few exciting new investments to share from The Fintech Fund in the next few weeks.
My own professional background – before pivoting to early-stage investing – was in building early-stage fintech startups. My favorite part of investing in pre-seed and seed-stage teams is that I get to retain a little part of that experience, by being a sounding board for the founders we back, though they very often know the answers to their own questions better than I do.
(I also enjoy getting to connect great product builders with great customers! To take a few examples - If you're looking to leverage an incredibly KYC/AML suite, I'd love to put you in touch with Minerva (or Zenpli in LatAm). For KYB, I'd be happy to intro the great team at TrueBiz. For a full governance, risk, and compliance suite, I can put you in touch with the team at Themis. For hotel payments, bookings management, and website-building, GuruHotel. etc, etc)
As I start having conversations for our second fund, one of the most interesting thematic areas I've started looking at is what I refer to as 'fintech adjacencies': areas where the provision of financial services is relevant to an incredible product offering, but the startup need not be a fintech company itself.
I wrote on this for Forbes a while ago. "Fintechs should seek to better understand the factors that create financial pressure on their users. When they do, they should work to partner with organizations that can help them address those circumstances holistically."
Examples of fintech adjacencies include healthcare, e-commerce, insurance, and travel. All of these are product areas that could blend a financial with an operational need - just look at Navan (née TripActions, travel expense cards) or Lynx (embedded healthcare payments). Oftentimes, combining a great e-commerce product with a great payments product can improve the user experience of both.
If you're building something interesting at the intersection of fintech and another product area, I'd love to learn more.
👍👎 Have feedback for us? Let us know!
Please find another week of fintech financing events below.
If you’re an early-stage startup founder raising equity or debt, we may be able to help - come check out our fund, The Fintech Fund (including a link to pitch us). Are you a fintech angel investor? Come join our syndicate.
African fintech companies raised $1.45 billion in 2022 – 39.3% more than the $1.04 billion they raised in 2021 – despite seeing their share of African venture funding drop from 48.3% to 43%4%.
💸 Venture Financing
- Finch, an API for employment data connectivity, raised a $40 million Series B.
- DataMesh, an Australian point-of-sale payments provider, raised a $30 million Series A led by National Australia Bank.
- Pliant, a German provider of corporate cards, raised a $28 million Series A.
- Trust & Will, a digital estate planning service, raised a $15 million round from AmEx.
- DirectID, a UK credit scoring and risk decisioning platform, raised €9 million.
- Carmoola, a UK car financing platform, raised an £8.5 million Series A.
- Huma, an income-backed DeFi protocol, raised an $8.3 million seed round.
- Sikoia, a startup promising “faster decision-making capabilities, increased efficiency, and reduced regulatory risk” to fintech companies, raised a $6 million seed round.
- TipLink, a Solana-based crypto wallet, raised a $6 million seed round.
- Green Check Verified, a compliant cannabis solutions and services to financial institutions, raised a $6 million Series A.
- Workpay, a Kenyan HR payroll startup, raised a $2.1 million seed round.
- HedgeFlows, a foreign payments and cashflows service for SMBs, raised a £2 million round.
- Rhino, builder of a security deposit alternative for renters and landlords, is exploring a fundraise at a lower valuation than its $500 million 2021 valuation.
💵 Debt Financing
- E-commerce banking, credit, and cash flow startup Highbeam secured a $10 million debt line from TriplePoint.
💰 Venture Funds
- Early-stage investor Altari Ventures raised a new $53 million fintech and insuretech fund.
Pssst - if you like early-stage fintech investing, come join our angel syndicate.