News > FinTech

Venting the fintech bubble
<p>It's all go-go-go in the fintech sector -- or is it?</p> <p>First the positive spin: Airbnb has just raised another $100 million after collecting $1.5 billion in its June fund raising round; Uber plans to tap investors for $1 billion by the end of the year; and Lyft aims to attract $500 million in the next few months.</p> <p>On the other hand, here's the view of the Financial Times Lex columnist (paywall):</p> <p>"It is all over. Tech bubble 2.0 has burst. Square priced its initial public offering below the range, at only $9 compared with a proposed $11-$13. Not even Goldman Sachs could sell this thing. Call in the removal trucks. San Francisco is done."</p> <p>"Tech IPOs this year have been mediocre and there is scepticism about private valuations. Institutional investors say they would rather wait to see how a stock performs than take a hefty allocation upfront. That was evident in the Square IPO."</p> <p>However, Lex offers a glimmer of hope for other fintech firms planning to list and make their founders rich.</p> <p>It points out that Square earns most of its revenues collating the transactions of merchants, standing between them and the card networks.</p> <p>"It is not so much disintermediating and disrupting as adding another layer," says Lex.</p> <p>As long as Uber et al can differentiate themselves from Square and convince investors that they offer innovation-led growth then "the party can continue," concludes the pooper.<br /> Photo: Martin Thomas<br /> &nbsp;</p> <p>&nbsp;</p>
Hot investments: FinTech, marijuana and healthcare, says BlockChain co-founder Nicolas Cary
<p>FinTech startups in London are booming. Just recently BlockChain, the world’s most popular Bitcoin wallet, raised $30.5 million, making it the highest investment achieved by a UK startup. </p> <p>Blockchain is an open-source software code that uses high-tech encryption to monitor and record bitcoin transactions. On November 18, BlockChain was joined by Credits.Vision and Nutmeg at the Google campus in London for an angel investor event organised by HoxTechangels.</p> <p>“Investing in tech startups requires a degree of prudence as the risk is higher than most other asset classes,” said Marina Atarova, co-founder of HoxTechangels. “We aim to tap into a few ways to approach the challenges of investing in Financial Technology.”</p> <p>Financial technology, also known as FinTech, is a line of business based on using software to provide financial services. Financial technology companies are generally startups founded with the purpose of disrupting incumbent financial systems and corporations that rely less on software.</p> <p>Why London?</p> <p>Paul Dowling: “London is one of only two places in the world where FinTech is going to be really big. The second place is New York.” Paul is a co-founder of the HoxTechangels and moderator of the discussion.</p> <p>Iqbal Gandham: “You have a complete spectrum of people, you have students, which helps startups to test their ideas and find a better square miles.” Iqbal is one of those rare people, who has worn both the CTO and CMO hats with equal degrees of success. He was the CMO at Nutmeg, the UK’s first online discretionary investment manager, where he was instrumental in launching the company, re-branding, full-stack marketing, and worked through two rounds of investment.</p> <p>Nick Williamson: “You kind of want to find out where the nucleus is. Everybody in that space is doing adjacent things, people bounce off each other and that’s the network effect that you’re seeing in London.” Nick is the CEO and founder of Credits.Vision who started his career overlooking Product &amp; Operations of Ring Games at Pokerstars –he largest real-money online poker product in the world. In 2010 he was introduced to Blockchain technology via Bitcoin and quickly became a leader in the space, which led to building a Credits.Vision, a built-from-scratch blockchain that cryptographically secures transactions between private and public chains.</p> <p>Nicolas Cary: “I think it is less to do with people and more to do with regulatory environment. What happened is — there is no more land, no more coal, not many trees left and the only thing you can do here [in the UK] is arbitrage legal services in regulatory environment. [In these circumstances] the BEST thing you can do is to build a space where entrepreneurs can try to create an incredible business. London has been a historical leader in finance innovation, so that on top of the incredible talent pool.” Winner of the 2015 European Digital Leader award for his inspiring and innovative contribution to initiate progress in the digital world and BlockChain co-founder, Nicholas himself is definitely an invaluable addition to that incredible pool.</p> <p>His company Blockchain is the world’s leading Bitcoin software company. Blockchain, which has 5 million users, manages the most widely-used and most trusted developer platform in the Bitcoin eco-system. In 2014, Blockchain raised the largest first outside capital round in industry history announcing over $30.5 million from leading venture capital firms.</p> <p>Will Bitcoin disrupt the financial industry?</p> <p>We are seeing digitization everywhere and finance is the sphere which is not revolutionised yet. “Those castles are well protected legally, but they will need to build bridges to the technologies,” Nicolas Cary said. “No one has a monopoly on innovation. We add 80 000 users a week, which makes us a fastest growing finch company on Earth. Last week we had $300 million worth of transactions facilitated on peer-to-peer basis using bitcoin protocol, we hire like crazy. We raised $30.5 million from three
Asia is driving global payments growth, says report
Global payments revenues reached a staggering $1.7 trillion in 2014 -- up 9% from a year ago –  says a new report. Asia, in particular China, is driving the bulk of the growth, but for how long? McKinsey, which published the study this week, says it expects payments revenues to grow at a slower annual rate of 6% over the&hellip;
Video: Jack Dorsey sees contactless payments taking off; IPO up 50% on NYSE
Jack Dorsey shares with CNBC that 350,000 small businesses have pre-ordered readers for a device that will enable customers to use Apple Pay or chip-enabled credit cards. They cost $49 each. In an interview, the Square CEO says that stores testing the contactless and chip card readers say customers are using the option half of the time-- a sign that&hellip;
Chinese tech giants tiptoe into US fintech market
While the likes of Square and ApplePay are yet to tackle China’s immense market for payments and remittances, China's tech majors are gradually making inroads stateside. E-commerce giant Alibaba’s Ant Financial has already spent the last year trying to woo US retailers with its  payments platform, AliPay. Now WeChat, the messaging app run by social media firm Tencent, is teaming up&hellip;
Square IPO prices below its range at $9
It's not looking good for Square. The San Francisco-based payments startup has priced its IPO at $9, below its initial range of $11 to $13, as it prepares to go public on Thursday. That's 40% below the level paid by Series E investors a year ago. The meager price will trigger a clause that means those late stage investors are entitled&hellip;
Democratization of markets
  Average investors are big beneficiaries of morphing markets, financial technology (fintech) and more market information than at any point in history.  For ordinary investors, trading is more analytically sophisticated, faster and cost-effective ever. Markets are democratizing. Back in the day, average investors pretty much stuck to the stock market, or maybe a bond here or there. Their key strategy:&hellip;
Video: Partners are key to going global for fintech startup
<p>Hedgeable has opted for an open architecture so it can land almost anywhere in the world and set up to provide private wealth management services for millennials. In an interview with NexChange, Mike Kane, founder and "master sensei" at Hedgeable, says there are still two things fintechs need to move forward from there.</p>
Earnest raises $275M as VC cash floods to lending startups
Lending startups seem to be latest obsession for venture capitalists on the hunt for fintech deals.  Two months after student loan company SoFi raised a staggering $1 billion from SoftBank Capital, a consortium of investors have channeled $275 million into lending company Earnest through a mix of debt of equity. Tech Crunch reports that Battery Ventures led the $75 million
Video: Hedgeable's Mike Kane tells us what he would do differently
<p>&nbsp;</p> <p>Everyone makes mistakes when launching a new company. In this interview with NexChange, Hedgeable's founder Mike Kane shares what he would do differently when prepping to go overseas.</p> <p>Kane will be part of a New York City panel on November 18 discussing startups seeking to raise funds and go global in Asia. For more information and registration, follow this link here.</p>