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Major Moves from Plaid, Remitly and Good Money in Fintech This Week

Jake MartinbyJake Martin
December 11, 2018
in Uncategorized
Reading Time: 4 mins read
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It’s been a busy week in the fintech space and it’s only Tuesday. On the heels of such announcements as South Korean fintech Toss achieving unicorn status and Cross River Bank raising another $100 million (technically last week, but still fresh in mind) come three more big moves.

1. Plaid Plans to Grow Team, Operations with $250 Million Funding Round

Fintech startup Plaid announced today a $250 million Series C investment led by Mary Meeker, a general partner at VC firm Kleiner Perkins, who will join its board of directors as part of the deal. This latest round of funding brings the San Francisco-based company’s valuation to nearly $2.7 billion, according to reports by CNBC and TechCrunch.

Also backed by the venture arms of Citigroup, American Express, Goldman Sachs and Google, Plaid links bank accounts to P2P payment app Venmo, investing app Robinhood and other popular apps via its API software.

Plaid’s co-founders, CEO Zach Perret, and CTO William Hockey said in a blog post on the company’s website that the funding would be used to “reinvest in the fintech ecosystem.”

They continued:

With it, we’re planning to grow the team and expand our operations. We’re focused on shipping and scaling products that will both serve the growth and scale of these customers, and become the foundation for fintech for decades to come.

Perret and Hockey said every company, ready or not, is becoming a fintech company and Plaid wants to provide the platform and data network to make those transitions possible.

2. Remitly Triples Global Coverage

Seattle-based startup Remitly, a digital remittance company, announced today an expansion of its global reach and the roll-out of service enhancements it says will make the process of sending money internationally “faster, easier, more transparent, and less costly.”

Remitly will expand its presence from 13 to 40 countries in order to serve nearly 600 send-to-receive corridor combinations. This expansion will allow Remitly to serve an additional $168 billion of the global remittance market, the company said.

“Immigrant communities around the world have long suffered from the limitations of antiquated ways of sending money to loved ones internationally,” Remitly CEO and co-founder Matt Oppenheimer, said in a statement. “Our global growth speaks both to the incredible demand for a better way to transfer money internationally, and the trust more and more customers are placing in us every day to help them and their loved ones.”

The company said remittances are a “broken” $600 billion industry, in which customers often face confusing, exorbitant and/or hidden fees, and in which product customization has lagged due to complex compliance regulations.

Remitly said customers can fund transfers with their bank account or card payment and allow recipients to receive funds directly in their bank account or at a cash pickup location. The company has also recently added additional delivery options in select countries: mobile wallets such as M-Pesa and home delivery.

Customers also can send money within minutes with the Express option, or get a better rate with the Economy option and money can arrive within three business days. Money can be picked up in the recipient’s country in U.S. dollars or local currency at cash pickup locations, via select bank accounts, or through home delivery.

Remitly is backed by investors including World Bank’s International Finance Corporation, Nasper’s PayU, Silicon Valley Bank, QED Investors, Bezos Expeditions, and Founders’ Co-Op. It raised $115 million in a Series D funding late last year in a round led by PayU.

3. Customer-owned Neo-bank Platform Raises $30 Million

Los Angeles-based startup Good Money, which plans to roll out a “values-based” customer-owned digital banking platform in 2019, announced this week it raised $30 million in Series A funding led by Galaxy Digital via its Galaxy EOS VC Fund.

Good Money is touting features that include FDIC-insured savings accounts generating a 2% yield, free ATMs nationally, no overdraft fees and low consumer loan rates. Customers receive equity when they open an account and become partial owners of the banking platform, and can earn additional equity by installing the app, setting up a direct deposit or referring friends.

Additionally, Good Money users will direct 50% of the platform’s profits to impact projects focused on social and economic inequality, environmental stewardship and renewable energy. The company’s founding team has also pledged 50% of their equity to philanthropy and impact.

Sam Englebardt, co-founder and co-head of Principal Investments at Galaxy Digital, said in a release that Good Money is “led by world-class founders who have built billion-dollar companies, with marketing experience and relationships that can bring tens-of-millions of users into the ecosystem quickly.”

Good Money founder and CEO Gunnar Lovelace, pulling no punches in the release, said that “modern banking” is “a primary driver of so many issues we face as a society — from economic inequality, institutional racism, environmental destruction to political corruption.”

“We founded Good Money to help consumers take their money out of a system that’s both destroying the planet and extracting wealth from the most vulnerable and put it into a new system focused solely on benefiting people and planet,” he continued.

Lovelace told Bank Innovation he connected with Englebardt “through close mutual friends in the fintech space” and that the capital is being used for operations, product and marketing.

The company plans to launch a wait list in January 2019 in anticipation of a full platform release later in the year.

Tags: APIsCross River BankExclusivePlaidPremiumRemitlystartupsToss
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