Techcrunch | Romain Dillet | May 5, 2020

Fintech startup N26 now has a proper funding war chest to face the economic downturn. The Berlin-based startup has extended its Series D round with another $100 million of funding at the same valuation of $3.5 billion. In total, N26 has raised $570 million as part of its Series D round.

N26’s Series D seems like a never-ending list of big numbers. In January 2019, the company announced a $300 million Series D at a $2.7 billion valuation. In July 2019, the company added $170 million at a $3.5 billion valuation. And now, here comes another $100 million.

Like the last extension, there’s no new investor on board. Major investors in the company participated in the extension funding.

You may have noticed that the valuation didn’t go up this time. “I’d say it’s a very good valuation,” co-founder and CEO Valentin Stalf told me. While N26 started the fundraising process before the economic downturn, the company thinks it’s already quite an achievement that the valuation didn’t go down.

See: 

When the crisis arrived, it made even more sense to go ahead and extend the Series D round. Stalf called it an “opportunity without a lot of effort.”

Like most challenger banks, N26 generates revenue from premium subscriptions, interchange fees, and third-party and in-house financial products that induce fees, such as overdraft and credit.

The startup noticed a huge shift away from cash as people use their debit card and contactless payment even more than before. Online payments have been on the rise. Overall, spending volume has been down “20 to 30% depending on the market,” Stalf said. Revenue from interchange fees has been down.

Conversely, account balances have been going up as people are postponing payments. N26 says that subscriptions are “quite stable” and churn isn’t higher than usual.

With today’s new funding, the company wants to double down on its most promising markets — Europe, the U.S. and Brazil. Earlier this year, N26 shut down its operations in the U.K.

“Unfortunately, we were all surprised by the clearness of the election that happened around the new year with a fast Brexit,” Stalf said. He then said that it would have required a big investment to apply to a new banking license in the U.K. and adapt the product to work with the new system.

“For me, it was a super clear decision. I would have loved to stay in the UK,” Stalf said. “But there are more attractive markets out there like the U.S. and Brazil,” he added.

Continue to the full article –> here

The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada’s Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org

Source: https://ncfacanada.org/n26-raises-another-100m-in-series-d-extension/