There’s no shortage of interest in fintech right now — the recent 10,000-plus attendees at last week’s Money20/20 conference proved that — and even though the industry is still not seeing the mega funding rounds it did last year, investors are still finding new fintechs to sink their teeth into.
It appears as though banks are getting just as intrigued with fintech as the rest of us; with two of the three rounds on our list being led by venture capital firms created by or for banks for fintech investment, which brings us to our top three fintech funding rounds:
One thing remains true at this point for both incumbent banks and fledgling fintechs, and that’s the platform both need to innovate on: mobile. That’s probably why USAA Ventures, the venture capital arm of USAA bank, invested in app analytics and marketing startup Context360 with an undisclosed amount of its $330 million fund for startups. Context360 aims to use its Senselytics platform to provide insights into mobile apps using the sensors built into a user’s smartphone. USAA is definitely not the only bank excited about the idea — the company has previously received funds from the Wells Fargo Startup Accelerator as well as private angels. The company’s overall amount of funding remains a mystery, but the results of its Senselytics platform will hopefully be known soon.
Financial and health benefit platform provider Hixme just raised $14.1 million in a Series B, the second “InsurTech” company to have received its lead investment from a bank. The round had four total investors but it was led by Propel Venture Partners, the $250 million venture capital fund created by — though operating independently of– BBVA Bank, specifically for investment in fintech. This brings the company’s total funding up to just under $25 million — $24.6 million to be exact — according to data from Crunchbase. Hixme is the second “InsurTech” that Propel Venture Partners has invested in, the first being home insurance provider Hippo. Zenefits might just have some new competition aside from the traditional benefit providers.
P2P lending platform MPower Financing raised $6 million in a Series A in a round with seven investors; the lead investor being Zephyr Peacock. Lending remains one of the areas of finance that is most ripe for change. MPower focuses specifically on student loans with a platform for those students who may be “left out of traditional banking options,” according to the company. Loans range from $2,000 up to $25,000. Aside from funds, the borrower also receives personal finance education courses and job placement services. As with other lending platforms for student loans, borrowers from MPower must begin to pay back their loan within six months of graduating from their university.
The role of USAA and BBVA bank in these rounds may be a sign that the competitive barriers between incumbents and fintechs are lowering. It looks like the competition-versus-collaboration debate may be tilting.1 - Reader Likes This Post