Business Wave

Share this post

🌊The Fintech Wave #45

businesswave.substack.com

Discover more from Business Wave

The intersection of Finance and Technology - news, investment ideas, deep dives and more.
Over 4,000 subscribers
Continue reading
Sign in

🌊The Fintech Wave #45

Hrvoje Pavisic
and
Nino Pavicic
Aug 22, 2022
Share this post

🌊The Fintech Wave #45

businesswave.substack.com
Share

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.

If you like this newsletter please share it with friends and encourage them to sign up👇

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

London-based AbbeyCross just raised a $2.47M pre-seed round to solve a big problem that was ignored for a long time.

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.

Photo Credit: Superpayments.com

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.

Photo Credit: NU Bank

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.

Photo Credit: Highbeam.co

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.

Photo Credit: Crypto.com Arena Facebook page

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.


Tweets and Threads of the Week

Twitter avatar for @TickerHistory
Ticker History @TickerHistory
Members of the Fed watching the Stock Market Crash of 1929
Image
10:07 PM ∙ Aug 19, 2022
1,375Likes211Retweets

Twitter avatar for @ryxcommar
Senior PowerPoint Engineer @ryxcommar
Tech companies will go from like 200 employees to 5k employees and their app barely changes. Yall aren't paying for growth, you're paying for a senior frontend engineer who convinced a 24 year old humanities major PM to spend 6 months making a custom TypeScript transpiler.
1:56 PM ∙ Aug 15, 2022
1,040Likes48Retweets

Twitter avatar for @telmudic
Tel @telmudic
Software engineering is an amazing job. You can turn nothing into something that doesn’t work.
5:04 PM ∙ Aug 17, 2022
329Likes24Retweets

Twitter avatar for @gurgavin
Gurgavin @gurgavin
SAUDI ARAMCO MADE MORE MONEY THAN APPLE , MICROSOFT , FACEBOOK AND TESLA DID COMBINED IN THE LAST QUARTER.
Image
12:42 AM ∙ Aug 18, 2022
3,190Likes551Retweets
Share this post

🌊The Fintech Wave #45

businesswave.substack.com
Share
Comments
Top
New
Community

No posts

Ready for more?

© 2023 Business wave
Privacy ∙ Terms ∙ Collection notice
Start WritingGet the app
Substack is the home for great writing