🌊The Fintech Wave(#9)
Hi, y’all thank you for reading the 9th edition of the Fintech Wave. In this issue, you can find out how to invest in Private Equity funds as an individual and where to lend your crypto if you want to receive passive income. Also, make sure to read about Nubank - the largest online bank in the world. If you like this newsletter please share with friends and encourage them to SIGN UP HERE.
TLDR; PE investing is now available to individuals. Online bank files for IPO. Short-term loans for working capital are now widely available. $10B valuation for the crypto company. $1B of crypto yield paid out to users. Keep reading for details👇
Europe News and Funding
Private Equity📊 platform for individual investors
Investing in Private Equity was always reserved for the wealthiest individuals, but not anymore. I mean, you still need a minimum of 50.000 EUR to invest, but that is considerably lower than what it used to be. You can do this through, Berlin-based Moonfare which just raised $125M. Via its platform, you can find and invest in PE funds. Users can choose between 40 funds to invest in. The company now has more than $1B AUM. Also, PE funds had better IRR than S&P 500 as you can see from the below graph. Fintech is really going to democratize every aspect of investing.
Americas News and Funding
Working capital👷 is a big problem for SME exporters
Small businesses account for 40% of international trade, but the systems they are using for payments are outdated - issuing purchase orders with Net 30 or 60 days and then waiting for wire transfers which took days to hit the account can hurt the working capital. Drip Capital just raised $175M to help solve this problem. They offer low-cost credit lines up to $2.5M with only 0.5% monthly interest to help them with the working capital until payments arrive.
Also, if you are an investor, you can invest with Drip Capital and receive a predictive monthly income. This is one more great idea for passive income.
Canada has its corporate credit card💳 startup
Corporate credit card startups growing super fast. Just look at US-based Brex and Ramp. A few days ago one Candian credit card startup, Float, closed Series A and raised $30M. Less than 6 months ago they raised a seed round. Like Brex and Ramp, they are offering credit cards and spend management software. The startup allows businesses to issue virtual and physical Visa credit cards. In Canada, most banks require personal guarantees from company leaders to issue credit cards, so processing is too long (up to 4 weeks) and complicated. It was not hard for the Float team to find a product-market fit.
Nubank files for IPO💸on NYSE
Nubank officially filed an F-1 form to be listed on NYSE. Nubank is the most popular online bank in Latin America: Brazil, Mexico, Columbia with more than 48 million users. Based on the number of users is the biggest online bank in the world. The company is targeting a $50B valuation. It might seem high, but they are valuing each customer at about $1000, which is much less than the US and EU neobanks - $2000/per customer.
Latin America is the best place to grow a fintech startup. You have a total population of 660 million people where everybody has smartphones, but a lot of people never had a bank account. Based on Nubank statistics, 5 million of their users had their first bank account opened with Nubank. So, they figure out it is best to focus on the unbanked population and they were right - they are adding 2 million new users every month. US and European online banks look pretty small compared to Nubank.
In the last few years, Nubank launched many products. They started with a regular checking account and debit card, but now they offer credit cards, business accounts, investing platform, and even loans and insurance. All from the mobile app.
The bank is still not profitable - last year they finished at a $177M loss. Their revenue for the first 9 months of this year is more than half $B, but probably it will still end up this year at loss. After IPO, CEO, and co-founder, David Velez will be worth more than $10B.
Crypto â‚¿ites
$10B valuation for a crypto company
Digital Currency Group (DCG) sold $700M of shares to Softbank. DCG is a holding of companies operating crypto and blockchain industry. DCG is building a full circle ecosystem, from news portals to trading platforms.
They are owners of 5 businesses:
Coindesk - a popular source of blockchain news
Grayscale - the world’s largest digital currency asset manager
Genesis - institutional lending and brokerage firm for crypto assets
Foundry - a financing and advisory company focused on digital asset mining and staking
Luno - digital asset exchange and wallet
Crypto lender paid more than $1B of yield to their users
One of the biggest lending crypto platforms, Celsius Network, just announced that they paid more than $1B of yield to its users. If you borrow your crypto assets, Celsius Network is giving up to a 17% yield. For comparison, banks give you 0.01%. More than 1.2 million people use the network. If you own crypto and you just want to lend it to get yield, definitely check their site.
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