The London Stock Exchange Group (LSEG) and Global Accelerated Ventures (GAV) recently introduced a post-COVID-19 fundraising program that aims to assist Fintech and Healthtech firms that might need additional capital to support their growth and development after the pandemic has passed.
The 24-month program is part of ELITE, which is the LSEG’s international business support platform. The program aims to help companies by providing access to institutional investors, introductions to potential investors and mentors for professional development.
Fintech and healthcare startups that previously took part in the ELITE program reportedly recorded a 30% growth during their first year of operations.
Christopher Malter, CEO at Global Acceleration Ventures, shared his views and insights about the Fintech sector and how it has been impacted by the pandemic. He also explained what his organization is doing to help companies get back on their feet or expand their operations after COVID-19 has passed.
Crowdfund Insider: What are the main benefits of partnering with the LSEG?
Christopher Malter: The London Stock Exchange is one of the world’s oldest stock exchanges with a global reach and brand that is universally recognized. As a division of the London Stock Exchange Group, ELITE taps into all of the relationships, history, and brand exposure associated with the LSEG.
It’s not easy for companies to tap into the LSEG network of relationships and investors, but that’s exactly what the ELITE and Global Accelerated Ventures (GAV) program is designed to do. Fintech and Healthtech companies that are accepted into the ELITE/GAV program will be introduced to institutional investors, investors and mentors who will help develop their management team and company for accelerated growth.
Companies that are accepted by ELITE will join in monthly workshops over an 18-24 month period, where they will better develop their companies for scale. In addition, the program will provide mentoring, develop relationships, and guide the company’s finance and management teams for larger fundraising rounds.
In addition, accepted applicants will work in close coordination with regional business, academic and financial communities across the markets. More than 1400 companies have already gone through ELITE, with an average growth rate of 30 percent following the program.
Crowdfund Insider: What types of Fintech firms do you plan on working with? What would their typical profile look like? Are there any exceptions?
Christopher Malter: Right now, we are looking primarily for Fintech and Healthtech companies in New York, but we are expanding the program into energy and other sectors in Texas and California. We have both quantitative and qualitative measures that determine who is accepted into the program.
- Turnover greater than $5 million (or less than if revenue growth is more than 15 percent)
- Operating earnings greater than 5 percent of turnover
- Positive Net Profit
- High quality and highly ambitious business plans
- Demonstrate historic growth and future potential
- Convincing growth projections
- Credible Management
- Motivation to deal with the cultural, organizational, managerial change required to access long term financing opportunities
Crowdfund Insider: COVID-19 has actually accelerated the adoption of digital services. Many Fintech businesses report that they’re doing quite well, while others are not. Tell us about how your program can help them after the pandemic has passed.
Christopher Malter: There’s been a liquidity gap for many Fintech and Healthtech companies following COVID-19 and many great companies can’t scale because of it. The purpose of this program is to help those aggressive companies find the funding they need. In addition, these CEOs and founders will get access to a network of global resources and a knowledge base that will help them grow at an even faster pace.
ELITE could potentially be a good opportunity for companies to get the exposure they need to scale on a global level. It has the full reach of the London Stock Exchange Group, and all of the relationships, expertise, and history that come with it. This is a rare opportunity for Healthtech and Fintech companies to see an immediate impact on their company’s future growth.
Crowdfund Insider: What are your short- and long-term goals for this initiative?
Christopher Malter: Short term – GAVentures is dedicated to supporting SMEs seeking series B and C funding and/or access to global markets and strategic partners.
Long term – Position GAVentures as a global partner for SMEs to help navigate and scale to IPO and/or exit.
Crowdfund Insider: Gaining access to reliable funding has been a challenge for many SMEs. Please tell us how your organization can help.
Christopher Malter: Companies interested in applying for ELITE can click here for an application. Once the application is received, companies will be asked to provide:
- A copy of the company’s latest financial statements (consolidated is preferred)
- Key management information including projected financials that can be shared
- Any company presentation that details the business activities and main revenue stream(s)
- An organization chart
This Is a $103 Billion Profit Opportunity
Investors in private startups pocketed a fortune last quarter…
According to a report released last week, they took home $103.9 billion.
That’s a record high — and as you’re about to learn, those profits are expected to keep flowing.
So today, I’ll show you why this is happening…
And then I’ll share two easy ways to get in on the action yourself.
How Private Investors Make Profits
Before I tell you how to take advantage of this profit window, let me back up for a moment…
Let me explain how investors in private startups make money.
Startup investors make money when a company they invested in has an “exit.” These exits happen in two main ways:
- When a startup gets acquired by a bigger company in an M&A transaction, or
- When the startup goes public in an IPO.
And as it turns out, Q3 of 2020 was a record-setting quarter for these exits…
A Record-Setting Quarter for Private Investors
The first half of the year was a disaster…
The coronavirus put a halt to everything, including exits.
But Q3 brought a massive uptick in activity.
For example, as you can see in the chart below (courtesy of PitchBook-NVCA Venture Monitor), exit value increased 292.5% versus Q3 2019.
That was the 2nd-highest quarterly total in PitchBook’s historical dataset, just behind Q2 2019.
What do all these exits mean for their investors?
They mean huge windfalls of profits!
(FYI, even when you factor in the winners and the losers, over the past 20 years, these exits have returned an average of 55% per year. At 55% per year, in 20 years, you could turn a tiny $500 investment into more than $3.2 million.)
Just six months ago, this sort of exit activity seemed impossible.
So what happened?
The 3 Reasons Behind These Profits
This burst of exit activity is due to three main reasons.
New Sectors Soaring: Covid-19 has given a boost not just to biotech, but to industries like Fintech, Edtech, and Telemedicine. The way we work, learn, and receive healthcare are changing — and innovative startups leading the charge are becoming valuable very quickly.
Macro Environment: Low interest rates and a booming stock market are giving investors confidence that innovative startups will command high prices as public companies.
SPACs: As noted earlier, M&A and IPOs are the two main ways that startups exit. But recently, a third way has gained in popularity: a “special purpose acquisition company,” or SPAC.
In Q3, public listings drove the spike in exits — IPOs like Snowflake (NYSE: SNOW), Asana (NYSE: ASAN), and Unity (NYSE: U).
The things is, as PitchBook explained, the strong performance of these stocks in the public markets will “likely drive more IPO” activity…
And for startup investors, it’ll drive more profits.
So — are you in?
Two Easy Ways to Get Started
Crowdability offers a multitude of free resources to make sure you see current startup deals that are available for investment…
And to make sure you know what to do once you find a deal you’re interested in.
For starters, look at our weekly “Deals” email. We send this out every Monday at 11am EST, and it contains a handful of new startup deals for you to explore.
Second, check out our free white papers like “Tips from the Pros.” These easy-to-read reports will teach you how to separate the good deals from the bad.
The profit window is now open — take advantage of it!
UK Fintech Modulr Reveals that its Dublin based Entity Is Now Licensed as EMI by Central Bank of Ireland
UK-based Modulr, a Payments as a Service API Platform for digital businesses, has revealed that its Dublin-based entity is now licensed as an electronic money institution (EMI) by the Central Bank of Ireland.
The Modulr team noted:
“This is an important step in enabling our European arm to provide efficient, scalable and reliable payment services to customers across the European Union.
As explained in a release, the European division of Modulr has been established to offer services to customers based in the European Union (EU). Modulr is focused on driving instant payments “expertise” into the Eurozone, in order to improve how wholesale and commercial payments are processed.
The Fintech firm provides payments infrastructure that’s used by established companies such as Sage, Revolut, Mode and Iwoca.
As stated in the announcement:
“Following strong business growth in the UK over the past four years, the newly granted EMI license will enable [Modulr] to offer [various] payments products, including its award-winning payments platform, through its powerful API to EU markets.”
Modulr also brings its expertise of real-time payments to SEPA Instant, which is the Euro’s instant payments scheme. As noted in the release, Modulr’s experience with Faster Payments will help it “unlock the potential” of the new scheme by offering convenient access for European software firms, merchants, and specialist banks.
The announcement also mentioned that the “true” potential of a digital API-based alternative to commercial payments will “rely upon an agile and efficient ‘behind the scenes’ payments process, which has historically been inaccessible and unaffordable to SMEs and enterprise alike.” As explained by the Modulr team, this information “comes from soon to be published research commissioned by Modulr, which reveals contemporary insight … into the hard cost of payment processes [and] the hidden impact on customer experience as well.”
Myles Stephenson, CEO at Modulr, stated:
“The opportunity for a digital alternative to commercial and wholesale transaction banking is significant as software businesses across multiple industry sectors are identifying the need to deliver new functionality and efficiencies to their customers by embedding payments in customer journeys. We plan to build a truly digital, frictionless payments infrastructure for software platform partners to provide new payment experiences to more than 500m people.”
Stephenson believes that his team has the experience and expertise in digital payments and API integration needed to offer key services to European businesses that are interested in streamlining how they make, receive and manage payments.
John Irwin, General Manager, Modulr Europe, remarked:
“Our digital platform and experience can transform the payments business. For too long, European payments have relied on the same technologies.”
Modulr has reportedly moved more than £40bn for clients such as Sage, Revolut, and Paxport through its platform which has “an uptime of 99.999%.”
Modulr offers this scale, reliability, and quality of service by investing in its own financial access and “achieving principal and direct access to critical payments.”
In September 2020, Modulr became the principal issuing member of Mastercard. The company had said that it would be offering more seamless digital payments solutions.
American Express and Coupa to Expand Partnership to Bring Virtual Card Payments to US Markets
According to a release, the American Express virtual Card payment option within Coupa Pay is now available globally, allowing companies to pay “smarter and simpler.”
Coupa (NASDAQ: COUP) and American Express had teamed up last year in order to provide better payment options. The release noted that they’re now ready to take their partnership to the “next level” as US-based customers now have the option to use American Express virtual Cards as a payment method with Coupa’s business-to-business (B2B) payments platform, called Coupa Pay.
As confirmed in the announcement, American Express virtual Cards are currently available in the UK and Australia. These payment options aim to effectively replace “outdated, complex, and inefficient payment processes” for businesses across the globe.
Customers are able to streamline how they pay their suppliers for all spend that’s directed or processed through the Coupa Business Spend Management (BSM) Platform.
The announcement further noted:
“As many companies continue to accommodate largely remote workforces for the foreseeable future, the expansion into the US continues to help meet the demand of customers who need a virtual way to pay suppliers and ensure their business continues to be operational.”
JR Robertson, vice president of Coupa Pay at Coupa, said that the pandemic has led to “widespread work from home policies,” which means that fragmented and manual business payment processes are not a legitimate alternative in a post COVID world.
“With Coupa Pay, Coupa and American Express are making it easier for our joint U.S. customers to thrive in this challenging environment by empowering them to pay using virtual Card technology.”
Trina Dutta, vice president and general manager of B2B Payments Automation, Global Commercial Services at American Express, remarked:
“By integrating American Express virtual Card capabilities into the unified buyer and supplier experience of Coupa’s … BSM platform, we’re addressing our customers’ need to digitize payments and thereby (potentially) becoming more essential to their operational needs.”
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