How was April Fool’s Day? Did you experience anything funny or has the ongoing pandemic drowned all the laughter? If – like me – you could do with a laugh, here is perhaps something for you in the latest edition of the FinTechnologist Weekly:
Serious and Not So Serious developments
April Fool’s
I love April Fool’s Day though admittingly it gets hard to come up with funny stories every year. Pepperfry, an online furniture shop from India, announced its intentions to launch its own mutual fund since furniture and mutual funds have so much in common – well, not sure about that but thanks for the contribution, so watch the tweet, give the guys a thumbs up and maybe there really is something to the idea. Another company from India, Flipkart was a bit trigger happy by releasing the news a day early, but wittingly suggested that they would accept Bitcoin for payments – since Indian regulators aren’t too keen on cryptocurrencies that came as a bit of a surprise.
Islamic FinTech Markets
No April’s Fool is the growing interest in Islamic Finance in FinTech. A new report now claims that Islamic FinTechs are projected to grow to $128bn by 2025 at 21% CAGR. It is an ambitious projection and in fact it is to outpace conventional FinTechs who are projected to grow only at 15% for the same period. In all fairness, the report also highlights a number of great hurdles. Participants in its survey named Payments, Deposits & Lending and Raising Funds as the top growth segments in 2021. As always, you should be cautious when reading these numbers as I find projections of this kind often overly optimistic, but it sure is an interesting read.
Where to Build Your StartUp
Build, collaborate or buy? That’s the question traditional banks have to ask themselves if they want to stay in the game and keep up with tech developments. For the last couple of years, we have seen a healthy appetite among big banks snapping up FinTech firms and a recent CB Insights report looked at 65 equity investments into FinTechs and found that the favourite among the deals over the past decade are clearly investments in startups focusing on capital markets outpacing wealth management and small business by a big margin. Citi and Goldman appear to be the most active in terms of number of deals done. Should be interesting to read the same report in a decade or so
Remember the news when Plaid called of its sale to Visa a few months ago? News of the potential takeover first broke last year in January and the deal was valued $5.3bn, which is two times its final private valuation that goes back to a $250m funding round led by Index and Kleiner in late 2018. Towards the end of the year though the Department of Justice filed an antitrust lawsuit to block Visa’s planned acquisition of fintech start-up Plaid as it would limit competition in the industry. The two company’s then called the party off in January.
Fast forward three months later and the company is now valued at $13.4bn following a round raising $425m from new and old investors, so the Visa deal would have been quite a steal in any sense, I suppose?
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That’s all for this week but ff you have an interesting story or would join me on the podcast, connect on Twitter.In any case, make sure you sign up to the newsletter to stay in the loop if you don’t mind. Thanks!
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