A Jared Leto-backed startup, family-focused FinTech firms and corporate spend management companies were among the big winners of the 42 funding rounds reported on last week.
Last week, we reported on 42 FinTechs in everything ranging from InsurTechs and cybersecurity enterprises to PayTechs and cryptocurrency-focused companies who successfully raised millions with four startups even entering the unicorn club despite the pandemic. However, FinTechs focusing on banking for GenZ with one being backed by a Suicide Squad actor and firms helping corporates as well as SMEs manage their expenditures won some of the biggest rounds.
Brex raised the biggest round last week, cashing in a whopping $425m and a $7.4bn valuation along with it. The round will fuel the development of its corporate spend management platform. In conjunction with the investment announcement, Brex also debuted its all-in-one financial management platform for SMBs to consolidate their various financial accounts. This further highlights the rise of the B2B spending and budgeting software space.
The success of this market segment has been a long time coming, with it reaching a boiling point after a slew of companies raking in massive amounts of investment in 2021. Most recently, corporate-cards-and-software startup Ramp forayed into the unicorn club after its Stripe-led $115m round. In March this year, spend software startup Airbase added $23.5m to its Series A bringing its total round to $31m led by Bain Capital Ventures. Also joining them were Divvy and Moss which closed rounds of $165m that pushed its valuation past the $1bn mark and $25.5m rounds respectively in January this year.
The second biggest round was bagged by kid debit card startup Greenlight, which valued it at $2.3bn in an Andreessen-led $260m round. Since it launched its debit cards for kids in 2017, the company has managed to set up accounts for more than three million parents and children, who have saved more than $120m through the app, up from two million parents and kids having saved $50m at the time of its September 2020 raise.
Clearly, firms which are extending banking services that can lock in a whole generation are gaining traction which is likely why a whole slew of companies with a similar thesis have landed big rounds in the last week. Teen debit card and bank app Current achieved the unicorn status after it tripled its valuation to $2.2bn in its latest $220m round.
Furthermore, teen mobile banking startup Step managed to attract celebrities such as TikTok star Charli D’Amelio, Jared Leto, Will Smith, Jeffrey Katzenberg, NBA All-Star Stephen Curry and The Chainsmokers alongside other investors. The firm has previously been backed by Justin Timberlake.
The meteoric rise of startups like Greenlight show why a host of firms have launched a service aimed at giving parents some oversight over their kids’ spending. For instance, challenger banks like Chime, Monzo, Revolut and Starling Bank have launched similar features. Moreover, a wave of family-oriented FinTech companies have launched over the past few years and it seems as if the children and family-focused FinTech startups continue to catch the imagination of investors. Till Financial landed a $5m round this month to educated kids on healthy spending habits. Additionally, Beanstalk, PCKT Money, StorkCard, Jassby and Pigzbe are just some of the companies that have launched services along a similar vein.
In fact, just in 2020, investors infused $344m into 25 known deals with FinTechs that offered savings platforms for children, young people and parents, according to Crunchbase data, a figure which is set to increase multifold this year.
Another sector that continues to witness an upward graph was cybersecurity which also produced two unicorns last week. San Francisco-based Sysdig and San Jose-based Vectra AI both of which reeled in $118m and $130m respectively catapulted into the $1bn valuation club proving that data security continues to be one of the key priorities for companies. This is hardly surprising as nearly three-quarters of financial organisations experienced a rise in cybercrime and financial losses with the average cost reaching $720,000 and climbing since the beginning of the Covid-19 pandemic, according to a BAE Systems survey.
In specific, online payment fraud for ecommerce companies is expected to surpass $20bn this year – up by 18% compared to last year. As a result, it’s more essential now than ever for SME owners and entrepreneurs to be aware of the red flags when it comes to international payments and wire transfers to mitigate any potential fraud and cyberattacks. With the proliferation of bad actors targeting SMEs and big-scale firms, CyberTech companies saw a surge in investment as the total funding in the sector grew at a CAGR of 91.6% from nearly $666.1m in 2016 to nearly $4.7bn at the end of last year, per FinTech Global’s research.
Other startups which scored big deals in the sector in the previous week included Deep Instinct, CyberHat, Automox, BigID, StrikReady and Terratrue. In addition to funding rounds, private equity Thoma Bravo inked a $12.3bn all-cash deal to acquire SaaS-based cybersecurity firm Proofpoint in a bid to build its cybersecurity portfolio.
With the big winners out of the way, let’s take a closer look at the other rounds we reported on last week.
Y Combinator-backed Brex’s colossal $425m round
Brex raised $425m in Series D funding led by Tiger Global, to value the company at more than $7.4bn. The new capital came less than a year after its $150m round at a $2.9bn pre-money valuation.
Joining Tiger Global in the round were new investors TCV, GIC, Baillie Gifford, Madrone Capital Partners, Durable Capital Partners, Valiant Capital Management and Base10, as well as existing investors, including Y Combinator, Ribbit Capital, DST Global, Greenoaks Capital, Lone Pine Capital and IVP.
Founded in 2017, the San Francisco-based company offers a corporate card for venture-backed businesses. It now offers an all-in-one platform for businesses of all sizes to manage their finances. In the first quarter of 2021, the company said it grew total customers by 80% with total monthly customer additions increasing by five times.
Crypto wallet Paxos picks up $300m, earns the horn
Regulated blockchain infrastructure platform Paxos closed a $300m Series D round of funding. The round was led by Oak HC/FT with participation from previous investors Declaration Partners, PayPal Ventures, Mithril Capital, Senator Investment Group, Liberty City Ventures, WestCap and more.
The company, which has raised more than $500m in funding and is valued at $2.4bn, intends to use the funds to continue investing in the development of enterprise-grade infrastructure and enhancing the customer experience and increasing utilization of its tokens.
Greenlight lands $260m
FinTech firm that pitches parents on kid-friendly bank accounts Greenlight raised $260m in a Series D funding round led by Andreessen Horowitz that nearly doubled its valuation to $2.3bn.
The funding comes just months after the Atlanta-based startup landed $215m in funding at a $1.2bn valuation. With the latest round, Greenlight has now raised more than $550m since its 2014 inception.
The round also included participation from returning backers TTV Capital, Canapi Ventures, Wells Fargo Strategic Capital, BOND, Fin VC and Goodwater Capital, as well as new investors Wellington Management, Owl Ventures and LionTree Partners.
Current closes a $220m round, enters unicorn club
Current raised $220m in a funding round led by venture capital giant Andreessen Horowitz that lifted its valuation by three-fold to $2.2bn.
The New York-based company plans to use the new funds to expand its product portfolio, including cryptocurrencies. The startup has more than three million users compared with 1 million in June.
Its latest funding round also included existing investors Tiger Global Management, Sapphire Ventures and TQ Ventures and took the total amount raised by the company so far to $400m.
Vectra AI wins $130m
Threat detection and response solutions firm Vectra AI bagged $130m led by funds managed by Blackstone Growth, increasing the company’s total funding to more than $350m at a post-money $1.2bn valuation.
The investment will help fuel Vectra’s continued growth through platform innovation and expansion into new markets and geographies, solidifying its Cognito platform as a market-leading solution for AI-driven cloud security for threat detection and response.
MRB Direct receives $125m
MRB Direct, Inc. bagged a seed round investment by Fintech Fund II, a $125m venture fund managed by Austin Capital General Partner, LLLP.
MRB Direct is a San Francisco-based FinTech firm dedicated to providing solutions to banks and non-financial institutions focused on cash-intensive businesses. MRB Direct offers processing of payments and receivables, deposit services and cash management.
Cloud security startup Sysdig lands $118m
Security startup Sysdig Inc. joined the unicorn club after raising $118m in a late-stage funding round. The Series F round, led by Third Point Ventures and Premji Invest with participation from Accel, Bain Capital Ventures, DFJ Growth, Goldman Sachs, Insight Partners and Next47, brought Sysdig’s value to $1.18bn.
Sysdig, which last raised $70m in January 2020, sells tools for securing container environments that are used to host modern software applications that can run on any computing platform.
Classy banks $118m
Social enterprise that creates fundraising software for nonprofits Classy closed a $118m Series D funding led by Norwest Venture Partners.
The company intends to use use the funds to accelerate product development, double the size of its product and engineering organization over the next two years and to enter new markets, such as corporate giving.
Automox reels in $110m for nonprofit fundraising platform
Cloud-native endpoint management provider Automox secured $110m in Series C funding to accelerate its vision to modernize IT operations with a comprehensive, cloud-native platform. The round was led by Insight Partners, along with funds managed by Blackstone and existing investors Koch Disruptive Technologies and TechOperators. With this round, Automox’s total funding now exceeds $152m.
Automox, whose customer base grew 200% from June 2019, works across operating systems, servers, and PCs, lets security teams automate and conduct cybersecurity actions through policies.
Wasabi brings in $112m
Cloud storage company Wasabi raised $112m in a Series C funding round led by Fidelity Management & Research Company with participation from existing investors. The round follows Wasabi’s $27.5m in debt financing in January, bringing its total equity financing to $219m.
CEO and co-founder David Friend said, “Storing the world’s data in the cloud is one of the biggest opportunities in the IT industry.”
Saudi BNPL firm Tamara collects $110m
Riyadh-headquartered BNPL platform Tamara raised $110m in its Series A funding round led by leading global payment processor Checkout.com. The round is comprised of debt and equity and comes just four months after the Saudi FinTech raised $6m in the country’s largest seed round.
Its latest deal is the largest-ever investment raised by a FinTech firm in the Middle East and North Africa. Launched in September 2020, Tamara enables online and offline merchants in Saudi Arabia and the UAE to offer BNPL services to its customers.
Will Smith, Jared Leto back teen banking firm Step in $100m round
FinTech banking startup Step endorsed by Charli D’Amelio closed a $100m round of Series C funding after growing to more than 1.5 million users just six months after launch. The new round, led by General Catalyst, comes shortly after Step’s $50m Series B at the end of last year.
The new round includes participation from Step’s existing investors, Coatue, Stripe, D’Amelio, The Chainsmokers, Will Smith and Jeffrey Katzenberg and newcomers Franklin Templeton, Jared Leto as well as former Square executives Sarah Friar, Jacqueline Reses and Gokul Rajaram.
Through Step’s app, teens gain access to an FDIC-insured bank account without fees and a secured Visa card that helps them establish credit before they turn 18. The app also offers Venmo-like functionality for sending money to friends.
Deep Instinct hauls in $100m
Deep Instinct inked $100m in a Series D funding round led by BlackRock with further participation from Untitled Investments, The Tudor Group, Anne Wojcicki and existing investors. This brings total investment in the cybersecurity vendor to $200m to date.
Deep Instinct models its solution on human learning and neural networks by offering a purpose-built deep learning framework. Its artificial deep neural network brain learns to prevent malware, known and new, first-seen malware, zero-days, ransomware and advanced persistent threat attacks.
Rho Technologies lands $100m
Rho Technologies, the financial technology parent of Rho Business Banking raised $100m in debt financing from Community Investment Management.
The new financing comes on the heels of a $15m Series A round, led by M13 Ventures in January this year. It will enable Rho to invest in strategic initiatives and broaden its commercial banking platform to clients.
Brazilian real-estate broker Loft adds $100m to its account
Brazilian digital real estate broker Loft raised an additional $100m led by investment manager Baillie Gifford as part of a fourth funding round announced in March, becoming the latest Latin American tech startup to see its valuation soar to $2.9bn.
The funding comes less than a month ago when the broker raised $425m. Founded in 2018, Loft offers brokerage services, mortgages and home renovation services.
Empyrean Solutions scores $74m
Asset and liability management and risk and compliance solution provider for banks and credit unions Empyrean Solutions closed a $74m minority growth financing led by Spectrum Equity with participation from Information Venture Partners. The investment represents Empyrean’s first institutional capital and will accelerate the company’s investment in product innovation.
Empyrean’s software allows banks and credit unions of all sizes to take control of their balance sheet management, scenario planning and risk analysis in a single software platform.
Warren collects $55m
Singapore’s sovereign wealth fund GIC led a $54.95m funding round in Brazilian financial startup Warren.
Existing investors such as Ribbit, Kaszek and Quartz also participated in this new round. The brokerage and asset manager will use the proceeds to invest in its technology area and it was also considering acquisitions. It also plans to double its assets under management to 10bn reais this year.
Cherre gets $50m
NYC-based real estate data management and analytics platform Cherre raised $50m in growth funding.
The round was led by Trustbridge Partners with participation from new investors Glilot Capital Partners and former Goldman Sachs Vice Chairman Mark Schwartz, as well as current investors. The company intends to use the funds to expand platform offerings, introduce and integrate additional partner data sets and applications, launch its customer advisory board and grow the team.
InsurTech Archipelago bags $34m
AI-driven technology and data analytics company Archipelago raised $34m in a Series B funding round led by Scale Venture Partners with earlier investors Canaan Partners, Ignition Partners and Zigg Capital.
Principals from Stone Point Capital, along with Prologis Ventures, also participated in the round, which will help Archipelago to further build out new product capabilities and scale its team. Over 330,000 commercial properties with total insured values of $2.3tn are currently on Archipelago’s platform, it claimed.
Blockchain-based RegTech Securrency reels in $30m
The round was backed by asset manager WisdomTree Investments, State Street, U.S. Bank, and Abu Dhabi Catalyst Partners — a joint venture between Abu Dhabi state investor Mubadala Investment and Falcon Edge Capital among other investors. With fresh capital at hand, the Washington-based firm aims to launch new products including compliant DeFi and expand internationally.
BigId closes $30m round
NYC and Israel-based actionable data intelligence platform BigId raised $30m in additional Series D funding led by Advent International, which is now at $100m valuing the company at $1.25bn.
Advent joined existing investors including Salesforce Ventures, Tiger Global Management, Glynn Capital, Bessemer Venture Partners, Scale Venture Partners and Boldstart Ventures.
The company, which has now raised $200m over four rounds since September 2019, intends to use the funds to expand globally, boost its go-to-market efforts to advance product development in the areas of data privacy, security and governance.
Robo advisor StashAway banks $25m
Singapore-headquartered, robo-advisor investment app StashAway raised $25m in Series D funding led by Sequoia Capital India, alongside returning investors Eight Roads Ventures and Square Peg. The transaction will close in the following months pending necessary regulatory approvals.
This funding round will bring StashAway’s total paid-up capital to about $61.4m. The funding will be used to accelerate its investment product and feature developments across its markets. There are also plans to expand its engineering team in Singapore and other countries.
Crypto firm ZenGo inks $20m
ZenGo, a crypto mobile wallet for retail investors, raised $20 in Series A funding led by Insight Partners with participation from Distributed Global and Austin Rief Ventures as well as existing investors Benson Oak Ventures, Samsung Next, Elron, Collider Ventures, FJ Labs, and others.
The company plans to use the funds to expand its set of financial services including a VISA payment card, extend support for assets and chains and further develop its Keyless Wallet security technology. Currently, the wallet supports over 50 assets including Bitcoin, Ethereum, Binance Coin, Tezos and Terra.
Insurance firm Brella gains $15m to develop its health solution
InsurTech Brella Insurance raised $15m through its Series A funding round which was led by Brewer Lane Venture with participation from Fidelity Security Life Insurance, SymphonyAI, Digitalis Ventures, Two Sigma Ventures and New York Life Ventures.
Founded in 2019, Brella aims to modernise supplemental health benefits and ease financial hardship when it comes o healthcare. The company covers more than 13,000 conditions and pays cash on diagnosis that its customers may now use for anything they need on the road to recovery.
Nigerian FinTech Okra wins $3.5m
Less than a year after exiting stealth with a $1m pre-seed raise, Okra closed another $3.5m round in seed money from institutional and angel investors including founding engineers from Robinhood.
The Nigerian FinTech startup helps individuals and businesses gain access to financial data using an API. Businesses can use Okra to get customers real-time and historical account balance, carry out Know Your Customer checks, obtain customer transaction history of up to 24 months and set up links for direct debits.
RegTech ALT/AVE banks £535,000 in new growth capital
London-based RegTech startup that uses distributed ledger technology to combat the masses of paper waste in banking ALT/AVE raised £535,000.
The investment comes via an Innovate UK grant, in addition to an injection of pre-seed funding, backed by a group of notable investors combining decades of experience at the top of global finance.
The firm offers banks and other regulated institutions a secure and sustainable digital solution for distributing highly regulated documents to their customers. When implemented, the firm claims it will result in a 95% reduction in paper usage, a 25g decrease in CO2e per document compared to postal delivery and cut costs by as much as 70%.
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