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TrueLayer nabs $130M at a $1B+ valuation as open banking rises as a viable option to card networks

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Open banking — a disruptive technology that seeks to bypass the dominance of card networks and other traditional financial rails by letting banks open their systems directly to developers (and new services) by way of APIs — continues to gain ground in the world of financial services. As a mark of that traction, a startup playing a central role in open banking applications is announcing a big round of funding with a milestone valuation.

TrueLayer, which provides technology for developers to enable a range of open-banking-based services has raised $130 million in a funding round that values the London-based startup at over $1 billion.

Tiger Global Management is leading the round, and notably, payments juggernaut Stripe is also participating.

Open Banking is a relatively new area in the world of fintech — the UK was an early adopter in 2018, Europe then signed on, and it looks like we are now seeing more movements that the U.S. may soon also join the party — and TrueLayer is considered a pioneer in the space.

The vast majority of transactions in the world today are still made using card rails or more antiquated banking infrastructure, but the opportunity with open banking is to build a completely new infrastructure that works more efficiently, and might come with less (or no) fees for those using it, with the perennial API promise: all by way of few lines of code.

“We had a vision that finance should be opened up, and we are actively woking to remove the frictions that exist between intermediaries,” said CEO Francesco Simoneschi, who co-founded the company with Luca Martinetti (who is now the CTO), in an interview. “We want a financial system that works for everyone, but that hasn’t been the case up to now. The opportunity emerged five years ago, when open banking came into law in the UK and then elsewhere, to go after the most impressive oligopoly: the card networks and everything that revolves around them. Now, we can easily say that open banking is becoming a viable alternative to that.”

It seems that the world of finance and commerce is slowly catching on, and so the funding is coming on the heels of some strong growth for the company.

Services that TrueLayer currently include payments, payouts, user account information and user verification; while end users range from neobanks, crypto startups, and wealth management apps through to e-commerce companies, marketplaces and gaming platforms.

And the startup says it now has “millions” of consumers making open banking transactions enabled by TrueLayer’s technology, and some 10,000 developers are building services based on open banking standards. TrueLayer so far this year has doubled its customer base, picking up some key customers like Cazoo to enable open-banking based payments for cars; and it has processed “billions” of dollars in payments, with payment volume growing 400%, and payment up 800%.

The plan is to use the funding to invest in building out that business further — specifically to extend its payments network to more regions (and more banks getting integrated into that network), as well as to bring on more customers using open banking services for more regular, recurring transactions.

“The shift to alternative payment methods is accelerating with the global growth of online commerce, and we believe TrueLayer will play a central role in making these payment methods more accessible,” said Alex Cook, partner, Tiger Global, in a statement. “We’re excited to partner with Francesco, Luca and the TrueLayer team as they help customers increase conversion and continue to grow the network.”

Notably, Stripe is not a strategic investor in TrueLayer at the moment, just a financial one. That is to say, it has yet to integrate open banking into its own payments infrastructure.

But you can imagine how it would be interested in it as part of the bigger mix of options for its customers, and potentially also to build its own standalone financial rails that well and truly compete with those provided by the card networks (which are such a close part of what Stripe does that its earliest web design was based on the physical card, and even its name is a reference to the stripe on the back of them.

There are other providers of open banking connectivity in the market today — Plaid out of the U.S. is one notable name — but Simoneschi believes that Stripe and TrueLayer on the same page as companies.

“We share a profound belief that progress comes through the eyes of developers so it’s about delivering the tools they need to use,” he he said. “We are in a very complementary space.”

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Source: https://techcrunch.com/2021/09/20/truelayer-nabs-130m-at-a-1b-valuation-as-open-banking-rises-as-a-viable-option-to-card-networks/

Blockchain

The DeFi Smart Contract Automation Network Gelato Raised $11M in its Series A Funding

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Gelato, a smart contract automation network focused on the DeFi sector, announced that it has raised $11 million led by Dragonfly Capital in its Series A financing.

In this round of financing, main supporters include ParaFi Capital, Nascent, IDEO CoLab Ventures, and Aave founder Stani Kulechov. The funds will be used to establish a “cryptocurrency Zapier”.

Gelato enables everyone to leverage the power of a decentralized network of bots to fully automate the movement of their money between different protocols on Ethereum.

Through the development of Web 3.0 automation, they can automatically rebalance their investment portfolios and execute transactions to protect their investments from major losses.

Mika Honkasalo from ParaFi Capital expressed that:

“Gelato expands the capabilities of smart contracts, which are by default inactive and only execute when a user triggers them. Gelato’s network of bots can be used to support a wide variety of applications that require automated actions — from liquidity provision strategies to margin management, and other DeFi use cases.”

Under the operation of a decentralized robot network, Gelato network provides dApp developers with a user-friendly UX to expand and simplify users’ transactions in the DeFi field.

Gelato co-founder Hilmar Orth said that the team is building their own DeFi applications, aiming to run smart contracts autonomously while ensuring that the infrastructure executes its logic is censorship-resistant, decentralized, and reliable.

Despite the smart contracts on the Ethereum network run by the main DeFi protocols, it also supports the smart contracts on the two blockchains, Polygon and Fantom. Gelato network is actively cooperating with other blockchains, including Binance Smart Chain, Arbitrum, Optimism, and Avalanche.

The decentralized finance (DeFi) sector took the world by storm in 2020 after its value grew by fourteen times, with total value locked (TVL) in this sector stood at $208 billion.

In the long run, the trend of decentralized financial automation is expected to be trending to improve user experience in the future.

Image source: Shutterstock
PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
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Source: https://Blockchain.News/news/the-defi-smart-contract-automation-network-gelato-raised-11m-its-series-a-funding

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Finance

Tiger Global in talks to lead over $100M investment in India’s Slice

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A number of high-profile investors are chasing to invest in Slice, a fintech startup that is attempting to expand the market for credit cards in India.

Tiger Global is in advanced stages of talks to lead a round of over $100 million in the Bangalore-based startup, sources familiar with the matter told me.

A number of other firms, including Insight Partners, Ribbit Capital and Greenoaks, are also engaging with the startup, sources said, requesting anonymity as the matter is private.

Deliberations are ongoing and the terms can change, sources added.

Slice, which has raised around $30 million in its previous equity financing rounds and was valued at under $200 million in a round earlier this year, declined to comment. Slice counts Blume Ventures, Gunosy Capital and Better Capital among its investors.

Tiger Global declined to comment.

Even as hundreds of millions of Indians today have a bank account, only about 30 million have a credit card. Most people in the South Asian market are not eligible to get a credit card, and even many of those who are don’t bother to get one because the experience of signing up is too clumsy, time consuming and the rewards don’t make up for it.

Slice has made it easier for far more people — even those without a traditional full-time job — to get a card, and the signup process is swift. In the past two years, Slice has emerged as one of India’s largest card-issuing firms.

It has also become aggressive to reach potential customers. Last month, the startup launched a card with 2,000 Indian rupees ($27) as the default limit to tap the nation’s potential addressable market of 200 million individuals.

In a separate announcement earlier this week, Slice said it issued 110,000 cards last month. The startup, founded by Flipkart alum Rajan Bajaj, says it has more than 3 million registered members, whose average age is 23.

It is also exploring applications atop of blockchain, according to Bajaj’s LinkedIn and the startup’s recruitment posts. Last week, the firm announced that it is offering new hires a three-day week with steady pay and benefits to attract talent that wishes to work on other opportunities — or do whatever else they like — at the same time.

Tiger Global has emerged as the most aggressive growth-stage investor in India in recent quarters. It has backed over two dozen startups in India this year, propelling many of them to the covet unicorn club.

Image Credits: CB Insights

India’s startup ecosystem witnessed a record 519 deals in the quarter that ended in September this year, research firm CB Insights said in a report on Thursday. During the same quarter, the startups raised $9.9 billion, compared to $10.3 billion in all of last year, the report said. Sequoia Capital India was the most prolific investor in the world’s second largest internet market during the quarter with 33 deals.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
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Source: https://techcrunch.com/2021/10/07/tiger-global-slice-india-fintech/

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Energy

Eight Roads launches its fourth fund: $450M aimed at European/Israeli scale-ups

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European VC Eight Roads is launching its fourth fund of $450 million for European and Israeli tech companies , aiming for another 15-20 across a broad range of consumer, software-as-a-service, fintech and healthtech areas. Cheque sizes wil range from around $5 million to $50 million per company, and as such, it tends to play more in growth funding rounds. 10-year old Eight Roads is backed by Fidelity, and was formerly known as Fidelity Growth Partners and before that Fidelity Ventures.

Eight Roads has previously invested in companies such as AppsFlyer, Cazoo, Fireblocks, Hibob, Made.com, Spendesk, Red Points, and Neo4j, and now manages over $8 billion of capital across Europe, Asia and the US. 

To give you an idea of how the fund has grown, the first Eight Roads fund was 1st was £100m, the second £150m, the first $375m, and the latest is $450m.

Davor Hebel, Managing Partner and Head of Eight Roads Ventures Europe said: “It’s great to be launching our latest fund at a time when there is so much entrepreneurial energy and ambition in both Europe and Israel and we’re now firmly on a path to building global technology champions out of the region. This additional capital enables us to continue helping ambitious founders scale, win and have a lasting impact on the way we live.”  

I asked the firm whether it will also have a climate focus, given the scale of the problems facing the planet. A spokeperson said the focus on climate cuts across all of its sectors but as an investment theme Eight Roads looks at three main focus areas: 

  • Clean energy – so it has an investment in a Nordic company Tibber which helps people run their homes more sustainably.
  • Sustainable products – Eight Roads has invested in Otrium (fashion marketplace aiming to get every item to be worn), Smol (environmentally friendly house products), La Fourche (organic and sustainable produce), VIU (eyewear brand), and Made.com (online furniture brand)
  • Climate change tools and enablers – e.g. carbon footprint measurement and reduction

During an interview, Hebel told me a major investment theme last year and this had been the shift to remote working, HR systems to support that, and: “Every company needs FinTech now.”

The fourth biggest category for Eight Roads is digital health, also supercharged by the pandemic. 

Enabling technologies, like AI, are also being applied: “I wouldn’t call it a sector, but the machine learning aspect. Like Glovo, which is a company that does internal talent marketplaces for large companies, where you can match people’s talents with opportunities in other parts of the organization.”

I asked Hebel if his company was returning to the office. He said: “I think we’re still feeling our way, you know. I think we said we’ll be two days a week, and then see how it goes. It’s good to see people again.”

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
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Source: https://techcrunch.com/2021/10/04/eight-roads-launches-its-fourth-fund-450m-aimed-at-european-israeli-scale-ups/

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Finance

IoT News: IoT’s $1B IPO: Live From NYSE | KORE’s CEO Romil Bahl

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IoT News and Interviews - KORE IPO with CEO Romil Bahl

Today I have the pleasure of virtually sitting down with the CEO of KORE Romil Bahl, to discuss becoming the first global internet of things pure-play company to go public in a deal worth one billion dollars.

With so many IoT companies out in the world, it may come as news to many of you that not more companies have gone public, but believe it or not KORE is the first. This was made possible through Cerberus, to which KORE is their first special purpose acquisition company (SPAC) that they have brought public.

According to Romil, a big contributor to their success and fit to go public is their highly predictable and recurring revenue (over 91%). Now I know not all of you may be “numbers people” but take it from someone with a financial degree — anytime you can build a company with recurring revenue over 91%, low working capital resulting in strong free cash flow generation, and are able to have visibility into an average of 90% of forecasted revenue over a 3 year runway, the decision to go public will be one you can’t easily ignore.

Now, before I jump you into the full conversation (below), let me catch you up on who KORE is. KORE is an 18 year veteran of the IoT industry, with over 3,600 customers spanning a variety of industries. They use AI, APIs, and securely connect devices (i.e. mobile gateways, environmental sensors, heart monitors, etc.) to 5G networks, the internet, satellite networks, etc. to help those businesses bring scalable IoT solutions to life all over the world. 

If you enjoyed our conversation, please check out a longer conversation Romil and I had earlier this summer on our podcast where we speak a bit more high-level about the benefits IPOs can have for IoT Companies.

Author
Ryan Chacon
Ryan Chacon – Head of Business Development, IoT For All

Ryan is IoT For All’s Head of Business Development. Prior to helping create IoT For All, Ryan has served as a founder, early stage employee, and start-up advisor — helping to build, market, raise funding for and launch technology related products…

Ryan is IoT For All’s Head of Business Development. Prior to helping create IoT For All, Ryan has served as a founder, early stage employee, and start-up advisor — helping to build, market, raise funding for and launch technology related products…


Contributors
IoT For All
IoT For All

IoT For All is creating resources to enable companies of all sizes to leverage IoT. From technical deep-dives, to IoT ecosystem overviews, to evergreen resources, IoT For All is the best place to keep up with what’s going on in IoT.

IoT For All is creating resources to enable companies of all sizes to leverage IoT. From technical deep-dives, to IoT ecosystem overviews, to evergreen resources, IoT For All is the best place to keep up with what’s going on in IoT.

PlatoAi. Web3 Reimagined. Data Intelligence Amplified.
Click here to access.

Source: https://www.iotforall.com/iot-news-ipo-kore-going-public-interview

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