INTELLI™ Weekly Insights
Monday October 10, 2022 | Volume 1 Series 11
🌘 Good evening! Whether some of you are grabbing that extra espresso to knock out a few more hours of work, or settling in with a nice glass of red as you wind down from the day, the team at INTELLI is ready to share a fresh round of updates for you to kick off this week. But first, a few announcements & reminders:
📅 PreIPO’s 2nd Panel Event: The Web2 to Web3 Transition is on October 28th, 2022 at 11 AM EST (Register / RSVP here).
💰 PreIPO’s Seed Round closed, but the bridge-to-Series-A round is open. Unlikely that it will last for long, so get in touch with our team here to get more information.
💻 INTELLI™ will launch in a public beta format to all of you readers, so please reply if you’re interested in accessing the platform for a sneak peak! Here’s a recap of the platform:
Let’s Talk about 💻 FinTech & The Evolving Web3 World
🧠 Fun Fact: Global FinTech saw 534 exits of about US$287 billion in total value. Four of those exits – namely Coinbase at US$86 billion, Nubank at US$42 billion, Robinhood at US$32 billion, and One97 Communications at US$16.8 billion – also made it into the top ten global exits overall in 2021.
Singapore and Hong Kong were among the top fintech ecosystems in the world in 2021, according to the Global Startup Ecosystem Report: Fintech Edition from Startup Genome.
💸 NYDIG raises $720M for an Institutional Bitcoin Fund (link to the story here).
Despite the bearish macro trends, the investment management firm NYDIG says it has raised nearly $720 million for its Institutional Bitcoin Fund from 59 investors according to the SEC filing.
Meanwhile, British Patient Capital committed €25M to a FinTech-focused fund. It will look to invest €2m-10m per company, acquiring significant minority stakes in scale-up businesses with €2m-10m in revenues. Read the full article here.
INTELLI™ Dealroom
🤝 M&A - Fintech
ATM builder Brinks acquired NoteMachine, a network of UK ATMs, for $179 million (or 5x adjusted EBITDA).
Humane debt collection innovator TrueML * (formerly TrueAccord) acquired the collections business of debt recovery provider Enhanced Recovery Company.
MoneyGram acquired 12% of UAE-based payments super-app Jingle Pay.
Embedded banking provider Q2 acquired Canadian expense management startup Sensibill.
Crypto payments provider Circle announced that it will acquire merchant and developer-first payments orchestration platform Elements.
Fintech venture capital firm QED acquired Lingua Franca Search, a boutique executive search firm that specializes in placing financial professionals.
Aztec Software, an adult education software provider, acquired financial wellness education platform iGrad.
Private equity firm SFW Capital Partners completed the sale of payroll and accounting firm Greenshades to Waypoint Capital and Gearbox Capital.
Naspers private equity arm Prosus called off the $4.7 billion acquisition of BillDesk, the Indian online merchant payments and banking provider, which it planned to incorporate into its PayU business, citing certain conditions precedent which were not fulfilled.
💸 Venture Financing Signals
ShopBack, an online shopping and rewards app, raised $80 million at a valuation close to $1 billion.
Strike, a builder of bitcoin-based payment systems, raised an $80 million Series B.
Tally, a debt payoff platform for consumers, raised an $80 million Series D.
PreIPO Corp brings in another $500K to race towards their Series A.
Jiko, a startup that automates t-bill investments and storage, raised a $40 million Series B.
Railsr, a UK embedded banking products platform, raised a $26 million Series C and $20 million of debt.
Korea Credit Data, a Korean small business lending startup, raised a $24.7 million Series D extension.
Juno, a crypto-based banking platform with a new tokenized loyalty program, raised $18 million.
Equi, * a “family office for non-billionaires” alternative investing platform (and Fintech Fund portfolio co), raised a $15 million Series A.
Exponential, a crowdsourced defi investing platform with a rating system, raised a $14 million seed round.
Blowfish, a web3 digital wallet security provider, raised $11.8 million.
Future™, a financial rewards platform for environmentally-friendly investing, raised $5.3 million in seed funding.
PropHero, an Australian property lending platform, raised A$8 million.
Zenskar, an automated billing workflow provider for SaaS companies, raised a $3.5 million seed round.
Bizbaz, a Singaporean startup using non-traditional data to help financial firms assess credit risk, raised a $4 million seed round.
NoFrixion, a provider of digital business payments, raised €3.6 million.
Spleet, a Nigerian property purchasing platform and lender, raised $2.6 million.
Easop, a startup that allows US companies to grant equity to international hires, raised a $2.5 million seed.
Currensea, an open banking-powered travel card provider, raised £2.4 million.
Raise Green, a retail investing platform for renewable energy projects, raised $1.2 million in seed funding.
Zopa, the UK peer-to-peer lender that pivoted to a neobank, is in talks to raise $100 million before an IPO.
Plum, a UK-based commission-free investing app, is raising a crowdfunding round after securing £5 million in debt financing from Silicon Valley Bank.
TrustQuay, a client accounting and practice management solution for trust, fund and corporate service providers, raised funding.
💡 In the spirit of the upcoming Web2 to Web3 panel event, INTELLI™ brings you a closer look at the concept of Token-Gated Communities.
The name of the game is CONTENT. Here are some of the INTELLI™ predictions on the rise and adoption of token-gated communities:
We believe that one-person, one-vote systems will gain traction. (See BrightID and Proof of Humanity as examples). Identity tools make quadratic voting possible in Gitcoin. This can "whale-proof" communities. One-NFT, one-vote is a less exact approach. (See Nouns DAO for an example)
We also think that ad-hoc communities will spin up rapidly over the coming year and a half. Unofficial and official communities are launched on Guild. (See Early Accessor, joke whales, and Ninja DAO as examples).
Communities will provide services to other communities. (See Service DAOs as examples):
Token-gated operating systems will emerge.
Poolsuite™ has a token-gated interface.
RAC built a similar interface and airdropped tokens to Poolsuite™ NFT owners.
Communities will use L2s and web2 solutions to operate cost-effectively. See Snapshot, Discourse and Discord. Reddit and $MAGIC use Arbitrum.
But what are the inherent risks that are already present / will start to pop up?
The first is Financial Accessibility • As tokens grow in value, it becomes expensive to join. For example, the floor price for PROOF access is $80,000+ at the moment.
Then there’s Technical Accessibility
And of course, let’s not forget about Legal Risk, since some tokens can be classified as securities with the lines being very blurred.
Let’s also not forget the media and the public creating Speculation - Tokens attract mercenaries and missionaries regarding their core values and what they’re really after. Everyone has to keep in mind that they are incentivized to add value to the community around those tokens that they buy or talk about. For them to not do this, they would be doing their investments a disservice.
🔮 Our INTELLI™ crystal ball (which can be completely inaccurate, so please make sure you have read and understand our disclaimer) brings you the following thoughts:
DAOs, like NFTs, are primitives. Early use cases define these technologies. Although they are flexible and agnostic. A DAO can be a community, company, protocol, investment fund, city, country or who knows what else.
Token-gated physical communities will gain traction after digitally-native communities. We have unsolved problems in governance, usability, and tooling, and the extended physical implementations compound these existing problems.
And now that we’ve shared all of the above with you, we have to point out some of the opportunities in the space:
We feel that the best tokens and communities need to allow members to earn tokens (acting as proof of work).
Subreddits reward high-quality contributions. See MOON and BRICK.
FWB lets members earn tokens by hosting events.
Block Born adds bounties and challenges to games so users can earn Tezos.
Bankless pays BANK for completing bounties.
Newer platforms can offer fiat AND token-gated access. Some communities are Web 2.5.
MetaTrends is an NFT, but they also accept fiat.
Water & Music is both token-gated and fiat-gated.
Serial Marketer accepts fiat and has a $CMO token.
Utilize the power of the community to create and curate content - content is king.
JokeDAO holds joke races and allows token holders to vote on them, creating a gamified content monetization strategy.
(Shoutout to the team at Trends for the suggestions on these token-gated communities and our friends at Week in FinTech for assistance with the funding signals.)