Revolut Plans to Raise $1.5B in Debt & Equity, Paytm is Working on Raising $2B, Galileo Closes $77M Capital Injection, Lemon Way Raises €25M

This week (14-18 October) was yet another interesting and exciting one in the world of FinTech. Revolut is planning to raise $1.5 billion at $5-10 billion valuation, Citi Ventures has joined Amsterdam VC Inkef Capital in co-leading a €5 million round in cash forecasting and working capital vendor Cashforce, Indian mobile payment giant Paytm is looking to raise $2 billion at a $15 billion valuation and much much more.

Without further ado, let us dive into what has happened in the financial technology sector this week.

Revolut Plans to Raise $1.5B in Debt and Equity

Revolut has hired JPMorgan to oversee a $500 million equity raise and $1 billion convertible loan, in a move that would bring the total funding raised by the loss-making firm to almost $2 billion.

The search for new capital comes just weeks after Revolut secured a global deal with Visa that would see the FinTech upstarts to move into 24 new markets and boost staff numbers to 3500.

According to Sky News, which first reported on the upcoming funding round, Revolut is aiming for a valuation of between $5 billion and $10 billion from the capital raise.

Insiders said that Revolut would seek to raise the new loan on the basis that it would convert into shares in the event that the company received a US banking license.

Revolut now has 7 million customers across Europe, about half of whom are in the UK. The firm, which reported a pre-tax loss of ￡33m in 2018, compared with ￡15m the previous year, claims to be opening 12,000 new accounts every day.

Citi Ventures Invests in Cashforce

Citi Ventures has joined Amsterdam VC Inkef Capital in co-leading a €5 million round in cash forecasting and working capital vendor Cashforce.

Headquartered in Antwerp, Cashforce provides treasury managers with cash flow forecasting through ERP & TMS integration, using advanced analytics & machine learning.

As part of the investment, Citi intends to offer the platform as an added value service to its corporate treasury clients.

”There is an increasing appetite in corporate treasury for integrated decision support tools from their banks for the next investment, fund or hedge action going beyond what their existing systems can provide today," says Ron Chakravarti, Citi managing director, global head - treasury advisory. "As a prerequisite step to delivering such solutions from Citi, we look forward to collaborating with Cashforce to significantly improve our clients’ ability to aggregate disparate data sets across their enterprise to help better manage their working capital and more accurately predict through algorithmic techniques their potential liquidity exposure."

Cashforce says it will use the capital injection to establish a wider presence in overseas markets. New offices have been opened in London, Ghent and Copenhagen in 2019, with others in Zurich and Singapore to follow soon, the firm says.

Santander Leads €35M Series B in CrossLend

Santander InnoVentures is leading a €35 million funding round in pan-European digital debt marketplace CrossLend. 

The Series B financing round in the Berlin-based marketplace also includes funding from existing investors Lakestar, ABN AMRO Ventures, and Earlybird. 

Founded in 2014, CrossLend provides a digital debt marketplace for consumer, SME, invoices, mortgages and other forms of debt originated by banks and alternative originators. CrossLend securitizes the assets as fixed income instruments for portfolio building by institutional investors. 

Manuel Silva Martínez, Partner and Head of Investments at Santander InnoVentures, commented:

By developing technology that digitises processes done manually today and building a regulatory infrastructure that allows for a truly pan-European platform, CrossLend is addressing several key opportunities: the ability for banks to mobilise balance sheet assets for regulatory capital optimisation, and connecting alternative originators and banks alike with new sources of capital in-market and crossborder, all of this seamlessly and profitably.

Oliver Schimek, CEO and Founder of CrossLend, added:

We are already in conversations with further banks regarding joining the consortium of investors in the coming months, and we are very proud that Santander InnoVentures and ABN AMRO Ventures have already recognised CrossLend as the key driver of an efficient financing backbone for Europe’s economy.

Existing financial investors in CrossLend include, CME Ventures, solarisBank, and finleap.

Paytm Should Raised $2B Funding Round

Indian mobile payment giant Paytm is looking to raise $2 billion at a $15 billion valuation, according to the Financial Times.

Existing investors Ant Financial and Softbank are likely to join a round that is expected to close within two months, says the FT, citing sources.

The money will be used to help Paytm stay at the top in a market where it is facing competition from Google Pay, Walmart's PhonePe and the imminent arrival of Facebook's WhatsApp payments service.

The firm is also taking on the likes of Amazon and FlipKart in the ecommerce sector and looking to expand internationally, beginning with Canada and Japan.

Swiss Regtech Apiax Secures $6.6M Series A

Swiss RegTech startup Apiax has completed a $6.6 million Series A funding round, reflecting strong investor appetite for technology-focused solutions to the growing compliance burden facing major firms.

Founded in 2017, Apiax transforms written regulations into binary, machine-readable digital compliance rules, enabling users to automate their cost-intensive compliance processes. 

The firm says the new capital will help strengthen product development and grow its team of legal and technology experts. The startup currently concentrates on financial services but aims to provide companies in major industries with its products in the future.

Philip Schoch, Co-founder of Apiax, said:

Our solution is already used by major financial institutions, yet we are just getting started. Now, we are ready to serve even more companies across industries and regions.

The raise was co-led by e.ventures, based in the US and Germany, and XAnge, based in France and Germany, with support from prior investors including Peter Kurer, DIVentures, Swiss ICT Investor Club (SICTIC), Zürcher Kantonalbank and Tugboat.

Mortgage Down-payment Startup Proportunity Secures ￡2M

Anthemis and Axel Springer have invested ￡2 million in UK startup Proportunity, a tech-driven mortgage lender that helps first-time buyers get on the property ladder by removing their biggest barrier to homeownership – large down payments. 

Proportunity is modeled on the UK Government's help-to-buy scheme, providing equity loans to first-time buyers who can struggle to raise the 20% deposit needed by most mortgage providers. 

Since becoming FCA authorised in 2018, Proportunity has grown to over 5000 users and lent on properties worth over ￡10M. 

As well as providing the loan, the firm also acts as a digital buying agen, using predictive AI and data analytics to help people identify good value properties in up-and-coming areas.

The platform creates smart forecasts on the housing market by crunching millions of data points covering everything from crime and school ratings to broadband speeds and pollution. The aim is to help buyers find houses with the highest level of capital growth.

Vadim Toader, Founder and CEO of Proportunity, commented:

Home ownership has become a major social divide between those who have benefited from capital growth and those who have not. Our aim is to help open the door of home ownership that has been slammed in the face of a whole generation.

By broadening equity loans to all housing stock and by using AI to offer insights to select the perfect investment, we want to have a positive social impact that also supports both estate agents and traditional mortgage lenders.

The company intends to use the seed funding to scale its business in the UK and prepare for expansion in Europe, he says.

French Payment Processor Lemon Way Raises €25M

Lemon Way, a Paris-based payment processor for e-commerce marketplaces, has secured a €25 million investment from Toscafund Asset Management.

Founded in 2007, Lemon Way has built up strong presence in the fast-growing sector of marketplaces, crowdfunding platforms and e-commerce websites that require payment processing, wallet management and third-party payment services in a KYC/AML-regulated framework. 

The firm provides an all-in-one platform of modular and propriety API-based services from on-boarding to cash pay-out flows. It now works with more than 1400 European marketplaces and last year handled total business volume of €1.9 billion in flows.

The latest funding will be used to develop more products and strengthen the firm's presence in the UK and Germany.

"The investment provides us with substantial additional resources, allowing us to bring the company to the next level,” says Antoine Orsini, CEO of Lemon Way.

Galileo Closes $77M Capital Injection

Galileo, which provides the API infrastructure layer for some of the world's top fintech startups, is plotting a global expansion programme after snagging $77 million in its first institutional funding round.

Hot FinTech startups such as Chime, Robinhood, Monzo, Revolut, Transferwise, and Varo use Galileo APIs to to open and verify new financial accounts, issue and process payment cards, and launch new products. 

Galileo Founder & CEO Clay Wilkes said:

Over the years, we’ve built the API standard for card issuing programs and fintech innovation, focusing on a feature-rich product set, profitability and delighting our clients. This funding will help us double-down on these themes, while also becoming more aggressive in expanding geographically.

As of September 2019, the Salt Lake City-based firm manages over $26B in annual payments volume, a 130 percent increase over September 2018.

The $77 million capital injection was led by venture capital firm Accel with participation from Qualtrics co-founder & CEO Ryan Smith. 

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About: I am a business developer, sales professional, FinTech strategist, as well as Cryptocurrency and Blockchain enthusiast. I'm highly passionate about Financial Technology and Digital Innovation, and strongly believe that it will change the world for the better. Apart from my daily job at a global payments startup where I'm leading company's expansion into Europe , I'm an active member of FinTech community and a TechFin evangelist.

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