🌊The Fintech Wave #45
We are welcoming 72 new members that joined us since last Monday. Vacation time is over, time to build🚀4 startups in the EU and 4 startups from the US raised money last week.
TLDR: Nubank published impressive Q2 results. Exchange for emerging currencies raises money. Neobank focused on e-commerce businesses. Check one of the largest pre-seed rounds ever. Crypto.com layoffs.
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Michael Burry sold all his US shares. For those not familiar, this is the person who predicted the housing crash in 2008, and the movie “Big Short” is filmed after him. Everybody on the market is paying attention to his moves.
As you can see in the below table, his hedge fund sold all US stocks; he even sold Apple stocks. The only stock he didn’t sell is Geo Group. Try to guess in which business Geo Group is👇
Geo Group owns and operates private prisons and mental health facilities in the USA, UK, Australia, and South Africa. In case of a big recession, this business will grow. Maybe is Michael onto something or maybe he is just trolling around.
Fintech Wave graphics
We compared the revenue of a few public neobanks. As you can see, Brazil-based Nubank is making more revenue than the other 3 public banks combined and it is profitable. Kakao Bank is covering the South Korean market and SoFi and MoneyLion the USA market. Looks like the real money for the neobanks are emerging markets and not USA/Europe.
European News and Funding
Foreign currency exchange💱for emerging market currencies
First, let’s define emerging markets currency. Emerging market currencies are those used within countries considered to be 'emerging markets (EMs) – a term that has no precise definition but is generally considered to refer to nations that are in a state of transition between 'developing' and 'developed' status. For example, EMs include Brazilian real (BRL), South African ran (ZAR), or Mexican peso (MXN).
Payments made with EM currencies are more complicated because the FX rate can fluctuate quite a bit and they are not always liquid, so it’s hard to figure out the real and fair market price.
So, AbbeyCross is building a B2B FX trading and compliance marketplace for emerging market currencies, to bring more liquidity and transparency. More liquidity means better prices and more business. On the one side, there will be currency suppliers and on the other side, there will be banks and payment providers.
This is really excellent idea and the market is huge. AbbeyCross can easily become a unicorn within a few years.
Payment startup raised £22.5M Pre-seed round😲
Super Payments raises one of the biggest Pre-seed rounds in Europe. And the app is still not launched. But when you look at the team, then you realize why they are able to raise such a round.
The founder is Samir Desai and his previous company, Funding Circle, was able to get to IPO. After that, it wasn’t hard to get investors for the next startup :D
Looking at the app, nothing really innovative here - a simple mobile app that allows users to receive cashback on their purchases. The only difference is in the speed of receiving cashback - with Super, cashback is instantly deducted from the price when you purchase the product.
The app is still in development, you can just put your email on the waitlist and get a £5 bonus.
Americas News and Funding
Nubank reported great Q2 results📈
Brazil-based Nubank, the largest neobank in the world, just posted record Q2 results. Looks like Nubank will become the example for all neobanks on how to do a profitable business. They literally transformed banking in Brazil.
Most important highlights👇
- 65.3M customers (+57% YoY)
- Now the 5th largest financial institution in Brazil
- $20.0B purchase volume (+94% YoY)
- $1.2B Q2 revenue (+230% YoY)
- $17M Adjusted Net Income
- $13.3B deposits (+87% YoY)
After the news, the stock jumped 15%.
Neobank focused on e-commerce businesses💳
New York-based Highbeam raised a $7M seed round to build a neobank for e-commerce businesses.
As we already wrote many times before, there are so many neobanks now on the market, that founders have to focus on a specific niche. With this neobank, the number of total neobanks in the USA is approaching 100. Looks like Highbeam found its niche - e-commerce and the market is huge: there are 2 million e-commerce businesses in the USA. If they capture only a small % of the market, Highbeam can become a unicorn.
Their app is offering all finances in one place: spending dashboard, analytics, and revenue-based line of credits. With Highbeam debit cards, users get 2% cashback on all marketing spending.
Crypto ₿ites
More layoffs at Crypto.com
The super popular crypto company, Crypto.com, announced it will lay off hundreds of employees due to a bear market. The company hired additional 1300 employees last year.
The company spent $700M last year to rename a stadium in Los Angeles from Staples Arena to Crypto.com Stadium. Looking from this perspective, there had to be a better way to spend that money.
