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Hello Fintech Friends,
If you missed it, yesterday we announced Fintech Fund II, our second pre-seed and seed-stage venture fund.
If you're a great founder building the next wave of financial services, let's talk!
And a reminder that, as always: Our news and editorial coverage is independent of any investing decisions. We cover all news – good and bad – on all fintechs. Any news pertaining to companies that are investments, employers, or other financial relationships of TWIF authors must be denoted by a * next to the company name for full disclosure.
This week, FT Partners covered the 'end of the megafund era,' highlighting that 2023 was the worst year for fundraising since 2016 – a dire signal for startups planning to raise in the next couple years.
With that said, I think the data overstate the severity of the situation: many longer-standing funds had been anticipating a contraction in LP capital for the last few years, and were proactive about raising their own 'megafunds' before liquidity dried up. Funds like Better Tomorrow Ventures ($225 million), Nyca Partners ($210 million), and Core Innovation ($100 million) are still deploying the funds they raised before the cash crunch. Even last year, Bain Capital Ventures announced a $1.9 billion fund, QED raised $925 million, Ribbit raised $800 million, and Flourish announced $350 million.
Net-net: fintech venture firms are certainly being more selective in 2024 than in 2021, but for strong founding teams, the capital is still available 💪
Don't have time to read the news every week? Catch up with the audio version in our Weekly Briefing!
And last but certainly not least, we were excited to share the $1.5M pre-seed of our portfolio co. Radar*, building the future of payment automation in Latin America:
Please find another week of fintech financing events below. (PS: Have feedback for us? 👍👎 Let us know!)
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📊 Stat of the Week
CB Insights shows venture funding into fintech dropping 16% quarter-over-quarter, as reported by Mary Ann Azevedo at Techcrunch; our data show an even sharper 25% QoQ drop, with funding to the sector dropping 56% YoY. Either way, fintech funding has slowed to its lowest level since 2017.
Fintechs raised a total of $5.37 billion in Q1, down 25% QoQ and down 56% yoy.
Though the number of rounds raised was up 10% QoQ, the average size of each raise shrank 32% QoQ.
See our full quarterly analysis in @twifintech's Q1 '24 Signals!https://t.co/bvG7Y4O3R5— This Week in Fintech (@twifintech) April 4, 2024
💸 Venture Financing
Pigment, a French CFO business planning and financial forecasting suite, raised a $145 million funding round.
Brim Financial, an infrastructure provider working on credit card and payment automation, raised an $85 million Series C.
Constantinople, an Australian banking-as-a-service provider, raised a $50 million Series A.
Electronica Finance, an Indian funding platform for small businesses and solar projects, raised $48 million.
Netgain, a software provider for finance and accounting teams, raised $35 million.
Seso, a platform for migrant worker documentation, H2-A visa processing, and HR, raised a $26 million Series B.
Ellipsis Labs, the developer behind crypto exchange Phoenix, raised a $20 million Series A.
Agora, a stablecoin issuer backed by dollar cash reserves, raised $12 million in seed funding.
Iceberg Data Lab, a provider of climate and biodiversity data solutions for financial institutions, raised a $10 million Series A.
Scrut Automation, an Indian governance, risk, and compliance platform with financial institution customers, raised $10 million in growth funding.
Zaver, a Swedish embedded buy-now-pay-later provider for Europe, raised a $10 million Series A extension.
Benjamin Capital Partners, the builder of a cash rewards app, raised $5.5 million.
Station 70, a startup for recovering and backing up crypto holdings, raised $5 million in seed funding.
Lockchain, a platform that brings automated risk management solutions to traders, investors, and fund managers in the blockchain ecosystem, raised a $4.6 million seed round.
Coadjute, a homebuying platform that works by connecting existing property software systems across the house buying journey, raised £3 million from Lloyds Banking Group.
Condukt, a Europe-focused business verification (KYB) provider, raised a £2.5 million pre-seed.
Hapax, an AI-driven decision-making software provider to banks, raised $2.6 million.
Palenca, a LatAm-based income verification startup, raised $2.4 million in additional capital, led by Experian.
Protiv, a platform for paying contractors and construction workers based on performance incentives, raised a $2.4 million pre-seed.
Merkle Trade, a decentralized trading platform that offers crypto, forex and commodities, announced a $2.1 million seed round.
Radar*, a Latin American B2B payments automation provider that has processed $330 million, raised a $1.5 million pre-seed.
Bavest, a provider of financial data, alternative data such as sentiment data or ESG and climate data to financial institutions, raised €1.1 million in funding.
Hello Alice, a provider of small business funding, raised an undisclosed amount for it Series C at a $130 million valuation from backers including Mastercard.
Zeepay, a provider of instant settlement of remittances into mobile money wallets in Africa, raised funding.
💵 Debt Financing
Scayl, a Swedish debt financing platform for other fintech lenders, raised €100 million in debt capital.
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