Layoffs spell opportunity for some fintech startups

Welcome to The Interchange! If you received this in your inbox, thank you for signing up and your vote of confidence. If you’re reading this as a post on our site, sign up here so you can receive it directly in the future. Every week, I’ll take a look at the hottest fintech news of the previous week. This will include everything from funding rounds to trends to an analysis of a particular space to hot takes on a particular company or phenomenon. There’s a lot of fintech news out there and it’s my job to stay on top of it — and make sense of it — so you can stay in the know. — Mary Ann

Now hiring

Hello, hello! I’m feeling good this week because I finally kicked off something that has been in the works for a little while: tracking fintech companies that are hiring. It’s not fun covering layoffs, and unfortunately we’ve had too many of those. So I thought by also shining a spotlight on fintechs that are hiring rather than firing, our coverage would be a bit more balanced and give laid-off workers (and anyone else generally looking!) a way to see what positions are available out there.

After the article published on February 16, I had several more companies reach out about news of open roles at their companies.

• Kikoff is hiring for 10 roles (a mix of hybrid and remote), including senior product manager, associate product manager, senior product designers, engineers and a growth marketing manager. The consumer fintech company is focused on helping people build credit and raised $30 million in June 2021.
• Addepar, which makes software to track investment performance, is also actively hiring with roughly 50 open roles across the U.S., UK and India (also, many roles have the option for remote work).  In June of 2021, the company raised $150 million at a $2.17 billion valuation. Today, it has about 850 clients and over $4 trillion in client assets on its platform.
  
• Nium is hiring and has a dozen open roles. The B2B payments company raised $200 million at a unicorn valuation in 2021.
• 401(k) provider Human Interest, which recently increased total funding to $500 million, including an investment from BlackRock, has 23 open roles, including in engineering, product and revenue.
• With offices in six countries, spend optimization company Emburse has just appointed new CXO Johann Wrede and is hiring for nine open roles, including in sales, engineering and customer success.
• Collective, an all-in-one back-office finance platform for the self-employed, which has raised over $28 million in funding, is hiring for five roles across engineering, marketing and member services (tax, accounting). Collective raised its latest round, a Series A, in May 2021.

And I’m positive there will be more to come in next week’s edition of The Interchange. Stay tuned, and please feel free to share with anyone looking for a new opportunity!

Weekly News

TechCrunch’s Tage Kene-Okafor did a stellar job of reporting out this story: “Prince Boakye Boampong, the founder and CEO of Dash, which provides an alternative payment network with connected wallets allowing interaction between mobile money and bank accounts in Africa, has allegedly been temporarily suspended pending an investigation into financial impropriety, according to people with direct knowledge of the situation.”

After Affirm’s challenging week, I did a bit of a deep dive on the space and discovered that while consumer-focused BNPL (buy now, pay later) companies are struggling, a number of B2B-focused companies are continuing to raise funds. Speaking of BNPL, tech giant Apple is apparently moving forward with its plans to offer its own buy now, pay later service and according to Bloomberg, “laying out rules for how it will approve transactions.”

In this TechCrunch+ piece, Amsterdam-based Grant Easterbrook (fintech consultant and co-founder of Dream Forward) focuses “on fintech ideas that received some degree of initial hype and momentum, but ultimately did not live up to their promise.” He looks at ideas that “failed to go mainstream and change financial services in the way the founders originally intended.” Super interesting read.

On February 15, Lightspeed Venture Partners’ Ansaf Kareem published a very detailed blog post titled “The Alchemy of Fintech Valuations,” in which he summarizes fintech sectors, the closest public comps, the key metrics to pay attention to and where multiples are today. He writes that his hope is that it “gives entrepreneurs a better benchmark to work off of when scaling their businesses.” Check it out here.

On February 7, Austin-based SMB-focused Sana Benefits announced that it was cutting about 19% of its staff. It’s not clear how many people were impacted but as of last summer when it raised a $60 million Series B, the startup had about 170 employees, according to Austin Inno. TechCrunch had covered its $20.8 million Series A raise back in 2020. In a blog post/letter to employees, CEO and co-founder Will Young wrote that the company’s “focus on accelerating growth and product development came at the cost of higher risk tolerance and greater expenses.” As part of its severance package, the company is kindly letting its employees keep their laptops, acknowledging that “having one is crucial for job searching.”

It’s great to see more women in leadership roles in the fintech community. Two examples here:

Former NEA general partner Liza Landsman joined fintech startup Stash, which calls itself the “anti-Robinhood,” as its new CEO. Her appointment became effective February 6. Landsman had been an independent Stash board member since mid-2022 and has previously served in operations and leadership roles at Jet.com, Citigroup, BlackRock and E-Trade. At NEA, a venture firm with over $25 billion in AUM, she focused on fintech and consumer products. The company also has formed a new B2B business led by Brandon Krieg, former CEO and now head of business development. My good friend and very talented journalist Suman Bhattacharyya covered the moves here. Last October, TechCrunch covered the company’s milestone of passing $125 million in annual revenue and adding a crypto offering.

And

Fintech-focused QED Investors recently announced the hiring of Melissa Ho as a principal focused on fintech investments across multiple stages in Southeast Asia, with an emphasis on early-stage companies. Ho is QED’s first employee in Singapore. Previously, she led the investment team at Wavemaker Partners, a Southeast Asian seed VC fund investing in enterprise, deep tech and sustainability companies. There, she was responsible for the Singapore, Indonesia, Malaysia and Bangladesh markets, plus the primary verticals of SaaS, B2B marketplaces, proptech, edtech, commerce and consumer internet. Last August, the firm made its first investment in Africa. It also is quite bullish on LatAm fintech.

ICYMI: From Natasha Mascarenhas: “Pipe, an alternative financing platform that was last privately valued by investors at $2 billion, announced its new chief executive, an appointment that comes months after the company’s three co-founders stepped down from their posts in a stunning, unusual shake-up. The new chief executive, Luke Voiles, is joining Pipe after working as the general manager of Square Banking at Block, formerly Square. He was also the CEO and president of QuickBooks Capital. Voiles’ role will begin on February 20.” More here.

On the real estate front, Opendoor and Zillow have teamed up to offer homeowners in Atlanta and Raleigh a new way to explore multiple home-selling options when visiting Zillow. Customers who “start their selling journey” with Zillow can now simultaneously request both a cash offer from Opendoor and an estimate of what their home could sell for on the market with a local Zillow Premier Agent partner. A seller who decides to accept the Opendoor offer will be able to sell their home on their own timeline using the Opendoor platform. Sellers who opt to sell their home on the market will be paired with a local Zillow Premier Agent partner.

Fintech for good

I recently caught up with Adam Nash, who has a few positions under his belt. He’s an investor in, and a board member of, companies such as Acorns, Figma, and Kabbage. He has also held executive and technical roles at Dropbox, LinkedIn, eBay and Apple. On the fintech front, he’s also the former CEO of Wealthfront and more recently he co-founded Daffy. As TC’s Connie Loizos wrote last year: “Daffy provides access to what it claims is the lowest-cost, and lowest-friction, way to set up and use a donor-advised fund (DAF), a kind of 401(k) for charitable giving. With DAFs, one donates some money (or stock, or even cryptocurrencies), receiving a tax break at the time of the contribution, and that donation moves into a managed investment account, where it hopefully grows over time. At some later date, the donor directs the funds to the charity or charities of his or her choice.”

He told me that since its 2020 inception and late 2021 launch, the not-for-profit has amassed nearly 10,000 members and raised close to $30 million for charities. Account sizes range from as little as $10 to more than $2 million.

Nash added: “Many of our members use Daffy to set aside $10 a week or $100 a month for charity. Other Daffy members contribute in the tens of thousands and even millions when they have a financial windfall like a bonus, company exit or a stock windfall, for example…Most donor-advised funds out there are partnered with investment management firms, and make their money by charging a percentage of assets. And so they don’t really want small accounts. They want people who can put hundreds of thousands of dollars aside for charity, but that’s not even a 1% thing. That’s like a .1% ability. So, we’re very excited about Daffy.”

Daffy is free for those members who are just getting started and have an account balance under $100. Despite the downturn and higher inflation, Nash says that Daffy saw an all-time high of donations in the fourth quarter of 2022 — 3x times that of the fourth quarter of 2021. Members contribute in a variety of ways: 20% cash (ACH, debit/credit card), 20% stock/ETFs, 20% crypto, and 40% DAF (donor-advised fund) transfers. Despite all the crypto and stock market turns in 2022, Nash said that Daffy saw the number of crypto contributions increase by 100% and stock and ETF contributions increase by over 128% in Q4 2022 compared to Q4 2021.

Fundings and M&A

Seen on TechCrunch

Puzzle is building a modern accounting package for today’s API-enabled startups

Tiger Global and Ribbit invest another $100 million in PhonePe

Ledge aims to build automation tools for finance teams

IFC leads $17M investment in South African insurtech Naked

Kenya’s fintech Power set to scale after $3M seed round

Singapore-based neobank Aspire raises $100M from Lightspeed and Sequoia SEA

Andreessen Horowitz backs ModernFi’s deposit marketplace for banks

Neobank Vexi raises millions to offer young Mexicans lower interest rate credit cards 

a16z, GV back Thatch in its effort to simplify health benefits for startups and their employees

How one Brazilian startup’s pivot to corporate cards has paid off

And elsewhere

Goose, an insurance “super app,” closes $4M Series A funding round

Vaas kicks off with US$5 million for its debt management platform

Latino-first neobank Comun raises $4.5M in seed funding

Hala acquires UAE-based startup Paymennt.com to expand its operations in the SME sector

Fintech AdalFi raises funds in sign of life for Pakistan VC market

That’s it for now. For those of you in the U.S., I hope you enjoy the long weekend, and Happy President’s Day! To everyone else, hope you’re having a great weekend and wishing you all a wonderful week ahead. Thanks again for your support, and oh, if you want something fun to listen to, check out the Equity podcast, featuring myself, Natasha Mascarenhas and Rebecca Szkutak!