Category: money

June 10, 2019 Off

Student loan refinancing startup Splash Financial raises $4.3 million

By Jill T Frey

Splash Financial, a Cleveland-based startup that has partnered with the Pentagon Federal Credit Union to refinance student loans, has raised $4.3 million in a round of venture financing.

The round was led by CUNA Mutual Group, a PenFed partner, and Northwestern Mutual Future Ventures, the corporate investment arm of Northwestern Mutual.

As student loan debt skyrockets, more financial services companies are looking for ways to cash in on the growing national problem.

Splash Financial provides an easy, online way for PenFed to originate loans that folks can use to consolidate their student loan payments.

Terms Splash Financial offers aren’t terrible, according to NerdWallet. Through Splash Financial, borrowers can get loans with fixed interest rates ranging between 3.87% and 7.03% and variable interest rate loans ranging between 3.05% and 7.79%.

“Through this funding round, Splash has gained not only new investors but also strong partners in CUNA Mutual Group … Read the rest

June 7, 2019 Off

Fintech platform Synapse raises $33M to build ‘the AWS of banking’

By Jill T Frey

Synapse, a San Francisco-based startup that operates a platform enabling banks and fintech companies to easily develop financial services, has closed a $33 million Series B to develop new products and go after international expansion.

The investment was led by Andreessen Horowitz, with participation from existing backers Trinity Ventures and Core Innovation Capital . Synapse — which recently rebranded (slightly) from “SynapseFi” — announced a $17 million Series A back in September 2018, so this deal takes it to $50 million raised to date.

The startup was founded in 2014 by Bryan Keltner and India-born CEO Sankaet Pathak, who came to the U.S. to study but grew frustrated at the difficulty of opening a bank account without U.S. social security history. Inspired by his struggles, Synapse, which operated under the radar prior to that Series A deal, is focused on democratizing financial services.

Its approach to doing that is … Read the rest

June 6, 2019 Off

Zoom outperforms in first-ever earnings report

By Jill T Frey

2019 is a great year for Zoom (Nasdaq: ZM). The company outperformed analyst expectations with the release of its first earnings report on Thursday.

The profitable video communications business, which went public this April in one of the year’s most successful initial public offerings, posted revenues of $122 million for the three months ended April 30, 2019, representing a year-over-year increase of 109%.

The Zoom stock is rising in after-hours trading following the news. Zoom closed up 2% Thursday at just over $79 per share. The stock has been trading at more than double its initial offering price in the two months following its IPO.

“In our first quarter as a public company, strong execution and expanding adoption of Zoom’s video-first unified communications platform drove total revenue growth of 103% year-over-year,” Zoom founder and chief executive officer Eric Yuan said in a statement. “Delivering happiness to our customers is our … Read the rest

June 1, 2019 Off

Startups Weekly: Will the real unicorns please stand up?

By Jill T Frey

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s noteworthy venture capital deals, funds and trends. Before I dive into this week’s topic, let’s catch up a bit. Last week, I wrote about the sudden uptick in beverage startup rounds. Before that, I noted an alternative to venture capital fundraising called revenue-based financing. Remember, you can send me tips, suggestions and feedback to [email protected] or on Twitter @KateClarkTweets.

Here’s what I’ve been thinking about this week: Unicorn scarcity, or lack thereof. I’ve written about this concept before, as has my Equity co-host, Crunchbase News editor-in-chief Alex Wilhelm. I apologize if the two of us are broken records, but I think we’re equally perplexed by the pace at which companies are garnering $1 billion valuations.

Here’s the latest data, according to Crunchbase: “2018 outstripped all previous years in terms of … Read the rest

May 31, 2019 Off

Is the tech press too positive in its coverage of startups?

By Jill T Frey

Hello and welcome back to Equity, TechCrunch’s venture capital-focused podcast, where we unpack the numbers behind the headlines.

It’s our first week in the new TechCrunch podcast studio, or it was for Kate Clark and Chris Gates. Alex Wilhelm will be back in SF next week. For now, we fired up the mics and dug into what was a veritable barrage of news.

First, Paul Graham’s contentious comments. The co-founder of Y Combinator tweeted some criticism of the tech press on Thursday; naturally, Kate and Alex had a few thoughts. In summary, Graham doesn’t seem to understand what it is we tech journalists do, and that’s a problem.

Next … Read the rest

May 30, 2019 Off

EV Growth closes $200M fund to cover Southeast Asia’s Series B funding gap

By Jill T Frey

East Ventures has long been known as one of Indonesia’s longest-serving and most active seed-stage investors, but now it has officially moved up the food chain after it announced a final close of its growth fund at $200 million.

Called EV Growth, the fund is a joint venture between East Ventures, SMDV — the VC arm of Indonesian conglomerate Sinar Mas — and YJ Capital, which is associated with Yahoo Japan. The fund was first announced last year with a target of $150 million, but this final close has already surpassed that thanks to contributions from LPs that include SoftBank Group, Pavilion CapitaI and Indies Capital.

EV Growth is already active, with 40% of the fund deployed to date, according to East Ventures’ founding partner Willson Cuaca, who serves as partner for the new fund alongside Roderick Purwana from SMDV and  YJ Capital’s Shinichiro Hori.

“We thought ‘There’s a gap … Read the rest

May 28, 2019 Off

Seedlegals closes $4M Series A, led by Index Ventures, to automate startup fundraisings

By Jill T Frey

When SeedLegals launched in 2017 in the UK, I’d say many of us thought “why has that not been done before?”. After all, two things have happened which make this an obvious idea for a startup: startup funding rounds are now so common that there is no reason large amounts of automation could be done. If you can buy a divorce online, surely you can organise funding rounds?

The second trend is the sheer level of automation happening in legal software today. After all, we now have “Uber for Lawyers” (Lexoo, Linkilaw, Lawbite) and AI-driven legaltech (KIRA, Luminance, ThoughtRiver). (Eventually, we will have blockchain smart contracts do ALL the work, but that’s for another time…).

So it’s not unsurprising that today SeedLegals announces it has closed a $4 million Series A led by venture capital firm Index Ventures (London/SF/etc) with participation from Kima Ventures (Paris/TelAviv), The Family (Paris) … Read the rest

May 18, 2019 Off

Big revenues, huge valuations and major losses: charting the era of the unicorn IPO

By Jill T Frey

We can make charts galore about the tech IPO market. Yet none of them diminish the profound sense that we are in uncharted territory.

Never before have so many companies with such high revenues gone public at such lofty valuations, all while sustaining such massive losses. If you’re a “growth matters most” investor, these are exciting times in IPO-land. If you’re the old-fashioned value type who prefers profits, it may be best to sit out this cycle.

Believers in putting market dominance before profits got their biggest IPO opportunity perhaps ever last week, with Uber’s much-awaited dud of a market debut. With a market cap hovering around $64 billion, Uber is far below the $120 billion … Read the rest

May 18, 2019 Off

Startups Weekly: There’s an alternative to raising VC and it’s called revenue-based financing

By Jill T Frey

Revenue-based financing is on the rise, at least according to Lighter Capital, a firm that doles out entrepreneur-friendly debt capital.

What exactly is RBF you ask? It’s a relatively new form of funding for tech companies that are posting monthly recurring revenue. Here’s how Lighter Capital, which completed 500 RBF deals in 2018, explains it: “It’s an alternative funding model that mixes some aspects of debt and equity. Most RBF is technically structured as a loan. However, RBF investors’ returns are tied directly to the startup’s performance, which is more like equity.”

Source: Lighter Capital

What’s the appeal? As I said, RBFs are essentially dressed up debt rounds. Founders who opt for RBFs as opposed to venture capital deals hold on to all their equity and they don’t get stuck on the VC hamster wheel, the process in which you are forced to continually accept VC while losing more … Read the rest

May 17, 2019 Off

‘Crypto exchange’ Goxtrade caught using other people’s photos on its staff page

By Jill T Frey

Alleged cryptocurrency exchange Goxtrade bills itself as a “trusted platform for trading bitcoins,” but its staff page is filled with photos of people pulled seemingly at random from the internet.

The alleged exchange, which claimed to debut in 2017 yet its website is only a little more than a week old, used photos taken from social media profiles and other company websites not associated with the company.

Bizarrely, the alleged exchange didn’t bother to change all of the names of the people whose photos it used.

Amber Baldet, co-founder of Clovyr, a prominent figure in the blockchain community, and listed in Fortune’s 40 Under 40, was one of the people whose name and photos appeared on the site.

“Fraud alert: I am not a developer at Goxtrade and probably their entire business is a lie,” she tweeted Friday.

Nearly all of the names are accurate but have no … Read the rest