welcome to interchangeIf you get this in your inbox thank you for signing up and trusting and voting. If you read this as a post on our site please sign up here You can receive it directly in the future. Each week we take a look at the hottest fintech news from the previous week. This includes everything from funding rounds to trends to analysis of specific spaces to hot takes on specific companies and phenomena. That’s my job. That way you can get the latest information. Mary Ann
One of the biggest news stories of last week was that Plaid laid off 260 employees, or about 20% of its workforce. This may have come as a surprise to many, but not all of us.
Rumors that Plaid laid off about 200 people date back to late May. At that time, the company denied laying off the employee. But as the years went on and the macro environment became more challenging, it felt inevitable that Plaid (valued at $13.4 billion last year) would join a long list of fintech giants laying off workers.
Notably, when outlining the decision to reduce headcount, CEO and co-founder Zach Perrette said, “While we have made the decision to hire and invest in advance of our earnings growth, the current economic slowdown means , meaning that this revenue growth did not materialize as quickly as we hoped.” ”
There’s been a lot going on lately — CEOs are to blame for overhiring. Optimistic About revenue growth. Are you optimistic or short-sighted? There seems to be a fine line.
That said, I think one of the most surprising things about the recent string of layoffs in the fintech space is how many of them have happened at the most valuable startups. Klarna’s valuation last year was his $45 billion. This year saw valuations plummet and layoffs more than once for him. Brex earlier this year he was valued at $12.3 billion. then dismissed. Stripe was valued at $95 billion last year. After that, he was mass-fired. Chime was valued at $25 billion last year. Then a lot of layoffs. Plaid now.
Were they all ahead of me? Did they go too fast? (Brex co-CEO and Henrique Dubugras admitted as much on stage at Disrupt.) Did they all think the pandemic-fueled boom would last indefinitely? Did you think venture capital would flow freely forever?
Also, maybe some of these companies really believed they would need so many workers. I mean, who knew a recession of this magnitude was coming?
Maybe it was a combination of all of the above. Obviously each company’s situation is different and I’m not involved in their internal discussions (as much as I want!). However, it is clear that a reset is required.
As a tech journalist, it’s chilling for me to hear or write about so many high-profile companies laying off their employees. I can only imagine how cool it would be for other startups in this space. My humble opinion is that we should all learn from the mistakes of others. I mean generally.
Of course, I am neither the founder nor the CEO, nor will I ever be. But here’s some unsolicited (and probably obvious) advice from someone who’s been covering startups for years.
- Please concentrate. It’s easy to get caught up in the competitive world and try to outsmart your rivals. But really, before you start expanding into one new segment after another, make sure you’ve really nailed the segment you’re already working on.
- Recruit responsibly and carefully. No, that doesn’t mean you should leave the work of two to her three employees on staff. This means that each open position should be carefully considered. do you really need it? Can this hiring wait until we go further? Does it make more sense to hire a contractor for the time being?
- Be humble. Don’t brag. Kick your ass and name it? good for you Do not hit the chest hard. Being confident is one thing. Being arrogant is another.
- Limit/cut trash talk. Especially on social media, it’s easy to get caught up in discussions about how and why you think your company is better than others in your field. It’s okay to talk about why you think your product is better than others in a general sense. But trying to make other people look bad by giving them a name? Most often it has the opposite effect, you I’m uncool.
- Be authentic. Whether it’s on social (Twitter, Mastodon, LinkedIn, or wherever you’re likely to share, like a post) or when you’re talking to the media. The credibility is huge, and for myself and my fellow TC reporters, it’s very much appreciated and appreciated. Transparency goes hand in hand with it, especially internally. Don’t leave your employees in the dark or mislead them.
- Oh, don’t lie or cheat.
I didn’t start this newsletter with the intention of compiling a list of CEO dos and don’ts. 🙂 Thank you for pampering me.
weekly news
“Fintech was hot in 2021, but in retrospect… maybe it was too hot? I was. stripes at $95 billion, Klarna at $45 billion plaid $13 billion. These companies have a very real customer base and products, but it’s not hard to imagine that at least some of these ratings are fueled by hype. Rebecca Szkutak reports on how fintech valuations have fallen this year.
robin hood Last week we launched a waitlist for our new service, Robinhood Retirement. Robinhood Retirement is the “first and only” individual retirement account (IRA) that offers his 1% match on all eligible donations, the company explains. The move is a big bet on the part of the fintech giant that the traditional 9-he-5 he employee is no longer the norm. Because it’s aimed at gig workers and contractors. Access to full-time jobs and employer-sponsored plans. The company also reported that it lost 1.8 million monthly active users in the third quarter, down 12.8% quarter-on-quarter to 12.2 million, the “lowest level since going public as a public company.” Given what you did, it’s likely a strategy designed to retain users. According to Yahoo News. More me here.
Tage Kene-Okafor reports:chipper cacheAn African cross-border payments company valued at $2.2 billion last year laid off some of its employees. Last week, several affected and unaffected employees revealed the news on LinkedIn, with sources telling TechCrunch that across multiple departments, more than 50 employees were affected. I know you received it. The engineering team was the hardest hit, with about 60% of the employees laid off leaving the department, according to people familiar with the matter. ”
From Manish Singh: “Financial Services Company in India payment is considering a share buyback after a turbulent year that saw its stock price drop by more than 60%. Paytm said at its board meeting on December 13 that it would discuss a proposal to repurchase its fully-paid shares disclosed by the Noida-based company in a stock exchange filing. ” Click here for details.
Focus on Fintech Gilgamesh Ventures has named Paula You as its latest (and third) partner and chief operating officer to oversee the platform’s growth. The move comes as the company is about to mark her second anniversary of its first fund. Since its inception in 2020, Gilgamesh has raised over $10 million of his and invested in nearly 30 early-stage fintech companies across the Americas, including Xepelin, Klar, Pomelo, Glean and Modern Life.
From Finextra: “Mobile-only UK Banking crew opens flagship checking accounts and offers customers 2% interest on amounts up to £85,000. Kroo’s analysis of Bank of England data shows that as of 30 September 2022, £271bn of him was left unattended in interest-free site deposits of UK households. New customers opening a checking account through charity partner One Tree Planted.
Adam Neumann’s Latest Startup, Residential Real Estate Startup flowpartners with fintech startups hook up Create a digital wallet for Flow residents. Various financial instruments will be incorporated into the planned digital wallet, with specific features to be announced at a later date. In case you missed it, Neumann — you may remember his days at a slightly older proptech called WeWork — said in August that he’s a $3 billion valuation. We raised $50 million and created Flow. Unicorn before starting operation.
Earlier this year, Mastercard announced that it will provide open banking start-ups with “access to a combination of hands-on mentoring, co-innovation opportunities, and engagement with Mastercard’s global network of banks, merchants, partners and digital players.” launched the Start Path Open Banking program. Help them grow their business. On Friday, Mastercard selected the next eight of his open banking startups to participate in the program. AIS Gateway (Poland); currency (England); Fego.ai (India); floyd (Chile); Kaoshi (America); level (England); percent (USA) and rails (Canada). Click here for details.
According to a Reuters report,d local (DLO.O), a Uruguayan fintech facing potential fraud allegations from short sellers, has applied for a UK regulatory license, relying on Maltese regulators. ”
Brazilian fintech startup MateraThe company that built instant payments and QR code technology for financial institutions has moved its headquarters to San Francisco. The move, the company told me in an email, “comes amid significant adoption of Pix, an instant payment system implemented by the Central Bank of Brazil in 2020 and used by 70% of Brazilians. Specifically, Matera not only provides instant payments software for banks powered by Pix, but also provides core banking services to over 250 global banks, credit unions and digital banks, with 5,500 We serve over 10,000 accounts. The company said its entry into the U.S. market “will enable far more financial institutions to extend their payment capabilities.”
from forbes: “During a year of sharp losses in financial markets, these entrepreneurs, traders and investors are navigating a choppy sea to extraordinary impact.”
Paula Yu of Gilgamesh Ventures
Financing and M&A
Saw it on TechCrunch
Ocho wants to rethink (and rebrand) personal finance for business owners.
Andreessen Horowitz is leading the $43 million Series A of Setpoint, going for “Stripe for credit.”
TripActions secures $400 million line of credit from Goldman Sachs, SVB
SBM Bank India to build BaaS platform seeks funding at $200 million valuation
and elsewhere
Hotel payment software platform Selfbook has announced a strategic investment from Amex Ventures. TechCrunch covered a previous funding round here.
SME-focused challenger bank Allica wins £100m Series C led by TCV
Avant secures $250 million in funding from Ares Management Corporation
Fintel Connect, which builds marketing software for the financial industry, raises seed funding led by BankTech Ventures
Uplinq Raises $5.6M for Bookkeeping and Analytics Platform for SMBs
Syncfy Raises $10M in Seed Funding Led by Point72 Ventures to Build Open Finance Platform in Latin America
Mortgage Infrastructure Platform Pylon Raises $8.5M Seed Round
Carputty wins millions of dollars of investor, blunts car finance pain points
That’s it, sign off. He will have just one more newsletter before the end of the year, after which he will be on vacation. Until then, have a great week. xoxoxo, mary ann
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