Posts Tagged ‘Business Insider’

We talked to 4 VC investors about the hottest trends in payments and the biggest innovations to keep an eye on

investor payment tech trends 2x1
Payments infrastructure and software is one subset of fintech that’s attracting VC cash.
Citi Ventures; Insight Partners; Bain Capital Ventures; Andreessen Horowitz; Shayanne Gal/Business Insider
  • We spoke to investors at Andreessen Horowitz, Bain Capital Ventures, Citi Ventures, and Insight Partners to learn where they see the next innovations and opportunities in payments tech.
  • Mostly, they’re looking out for ways that payments companies can do more than just process transactions. That may be through add-on services, or even machine-initiated payments.
  • Payments is interwoven into nearly every segment of the fintech landscape, from credit-card processing to online sales, to analytics around consumer behavior.
  • Some unicorns making waves in payments include AvidXchange, Brex, Plaid, Stripe, and TransferWise.
  • Click here for BI Prime stories.

The fintech world is big, and funding is flooding into startups like robo-advisors, neobanks, and alternative lenders.

In the third quarter this year, total fintech funding topped $8.9 billion, a record when adjusted for Alibaba’s fintech Ant Financial’s $14 billion last year, according to CB Insights. Globally, there are now 58 fintech unicorns (startups valued at more than $1 billion).

Payments is interwoven into nearly every segment of the fintech landscape, from credit card processing to online sales to analytics around consumer behavior. Some unicorns that have made big waves in payments include AvidXchange, Brex, Plaid, Stripe, and TransferWise.

While some say incumbents should fear competition from fintechs, many existing companies are partnering with startups. Marqeta, which provides card issuing, and Plaid, which helps startups link into consumers’ bank accounts, have inked partnerships with legacy players like Visa and Wells Fargo.

Incumbents themselves have made bold moves to stay current, like Mastercard’s blockchain for shrimp tracking, or American Express’ startup-focused corporate card launch. They’re also making investments through their venture arms. Amex Ventures has backed Plaid and Stripe; Visa has invested in Marqeta and Finix.

And payments companies are also snapping up ways to expand their services. Earlier this week, payments giant PayPal said it plans to buy Honey, a startup that makes browser shopping add-ons for its customers, for $4 billion, which would be PayPal’s biggest buy ever.

We spoke to four investors at leading VC firms about where they see the next opportunities when it comes to payments.

Anish Acharya, general partner at Andreessen Horowitz

Anish Acharya headshot
Anish Acharya, general partner at Andreessen Horowitz
Andreessen Horowitz

Anish Acharya, a general partner at Andreessen Horowitz, sees innovations coming not just from payments companies, but from unexpected players into the fintech space.

The Silicon Valley venture-capital firm is known for its early investments in companies like Facebook and Lyft. In the payments space, it has backed startups including Dwolla, payments giant Stripe, and fast-growing cross-border player TransferWise.

READ THE FULL STORY: Uber and Apple are just the start, and eventually every company will want to be a fintech. An Andreessen Horowitz general partner explains why.

Matt Harris, partner at Bain Capital Ventures

Matt Harris Bain Capital
Matt Harris, partner at Bain Capital Ventures
Bain Capital Ventures

Matt Harris is a partner at Bain Capital Ventures, and has helped lead investments in fintechs like micro-investing startup Acorns; AvidXchange, which helps companies pay bills electronically; and payments platform Flywire.

He thinks payments companies need to do more to keep market share, and but that it’s still hard to imagine a world where payments come free.

READ THE FULL STORY: A partner at Bain Capital Ventures explains why payments companies need to do more than just move money to survive

Ramneek Gupta, managing director & co-head of venture investing at Citi Ventures

Ramneek Gupta Citi Ventures
Ramneek Gupta, managing director & co-head of venture investing at Citi Ventures
Citi Ventures

Ramneek Gupta is the co-head of venture investing at Citi Ventures, the VC arm of Citibank. He joined Citi in 2011, and has led investments in companies like payments processor Square, electronic-signature startup DocuSign, and ride-hailing company Grab.

Gupta has his eye on machine-initiated payments, and thinks companies will have to find creative ways to use payments data to make money amid pressures on revenues of simply processing transactions.

READ THE FULL STORY: Citi Ventures is betting on cars that pay their own bills, and its co-head of investing envisions a future where your devices make payments without you

Byron Lichtenstein, principal at Insight Partners

Byron Lichenstein Insight Partners
Byron Lichtenstein, principal at Insight Partners
Insight Partners

Byron Lichtenstein, a principal at Insight Partners, says opportunities are not just about moving money from point A to point B, but also in the using the data found in and around payments.

Insight Partners focuses mainly on growth-stage software companies across verticals from education to social media to fintech, and it has invested in German neobank N26, business expense management startup Divvy, and payment fraud monitoring startup Sift.

READ THE FULL STORY: An Insight Partners principal says the era of ‘dumb payments’ is over, and sees opportunities in using machine-learning to combat fraud



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fintech funding rounds over 100 million

Business Insider Intelligence

It’s a fascinating time for fintech.

What was once a disruptive force in the financial world has become standard practice for many industry leaders.

Fintech industry funding has already reached new highs globally in 2018, with overall funding hitting $32.6 billion at the end of Q3.

Some new regions, including South America and Africa, are emerging on the scene.

And some fintech companies, including a number of insurtechs, have dipped into new markets to escape heightened competition.

Now that fintech has become mainstream, the next focus is on the rising stars in the industry. To that end, Business Insider Intelligence has put together a list of 10 Up and Coming Fintechs for 2019.


Total raised:   £1.9 million ($2.5 million)

What it does: Coconut is a UK-based current account and accounting platform for small- and medium-sized businesses (SMBs).

Why it’s hot in 2019: Next week, Coconut will launch its first subscription service, dubbed Grow, which will bundle unlimited invoicing and end of year tax reports, for £5 ($6.51) a month. This will make it a very attractive option for SMBs, that conventionally don’t have a lot of time on their hands to handle their accounting.


Total raised: $282 million

What it does: Brex is a US-based corporate credit card provider, which initially focused on serving startups.

Why it’s hot in 2019: The startup gained unicorn status in 2018, only months after it launched its first product. Now, after receiving debt financing worth $100 million, Brex wants to target larger enterprises with its topic — opening it up to a whole new set of customers and helping bring the company to the next level.

Want to get the full list?

There’s plenty more to learn about the future of fintech, payments, and the financial services industry. Business Insider Intelligence has outlined the road ahead in a FREE report, 10 Up and Coming Fintechs for 2019.

>> Download the report now

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Top VCs reveal what they want to hear in a startup pitch — and what you should avoid saying

entrepreneurship pitch
The secrets are out.
Hiraman/Getty Images
  • Successful entrepreneurship often starts with a compelling investor pitch.
  • We compiled insights from venture capitalists on what they’re hoping to hear from you.
  • For example: Hold your ground on important issues and demonstrate your path to execution.
  • Visit BusinessInsider.com for more stories.=

Venture capitalists want to be convinced.

Ask David Rose, and he’ll tell you VCs wouldn’t be hearing your pitch in the first place if they weren’t interested in investing. Rose runs Gust, a digital platform for early-stage entrepreneurs and investors, and Rose Tech Ventures, an angel investment fund and incubator.

He said investors are just hoping you’ll give them a compelling argument for why they should partner with you.

We asked Rose, plus a series of other successful investors (listed below), what persuades them to sign on — and what leaves them skeptical. Below, we’ve compiled their best advice, on everything from building a pitch deck to writing a thank-you note.

Show how your product will benefit people

Estes previously told Business Insider’s Lydia Ramsey that biotech investors want to know how a new tool will fit into the current standard of care. “The biggest mistake I see is when someone spends more time talking about how a product would affect the market than they do talking about how it would affect the disease it’s designed to treat,” Estes said.

The same is true for any investor, who wants to know how your business will make people’s lives easier.

Don’t be cocky

In an interview with Business Insider’s Becky Peterson, Munichiello pointed to Stewart Butterfield, founder and CEO of Slack, as an example of an entrepreneur who didn’t pretend he had all the answers. (GV invested in Slack in 2014 as part of a $120 million round that valued the company at $1.12 billion, Peterson reported.)

“Stewart’s conversation with me wasn’t about all of the reasons why Slack was awesome,” Munichiello said. “It was, ‘Here’s how I think about the business. And you may think about it in a different way.’ And ‘Here are the metrics that I use to measure the business. How do you think about the business?'”

Hold your ground on the issues that matter most

“Entrepreneurs can, and should, articulate deal breakers to their prospective investors,” Selverian wrote on Business Insider. “If there’s something that’s important to you and your business, don’t compromise. As long as the entrepreneur’s reasoning is justified, many investors will be impressed by the vision and leadership conveyed through deal breakers.”

Read more: A CEO who launched her company 14 years ago says too many founders have it all backward

Ashton Kutcher
Ashton Kutcher.
Steve Jennings/Getty Images for TechCrunch

Show that you can sell your idea

“One of the critical tests that I try to run when I’m sitting across from a founder is: Can you sell me your idea?” Kutcher said at TechCrunch Disrupt in 2018. If not, he worries about the company’s future.

“If you can’t sell me, how are you going to sell your first hire, your second hire, your third hire?” Kutcher said.

Demonstrate your path to execution

At Business Insider’s Startup 2012 conference, Sachar said she needs to believe the entrepreneur can turn their idea into a successful business.

“If you can’t execute, you don’t have a company,” she said. “A lot of people have ideas.”

Read more: The glitz of ‘entrepreneurship porn’ leads startup founders to make fatal business mistakes. Here’s how to avoid them

Tell investors how you plan to expand

Duggal previously told Business Insider every pitch deck should include a five-year growth plan.

Duggal added that she wants to see the costs of building your product or service, the potential profit “on a unit basis,” and how that changes at scale. In other words, she said, “As your business grows, do the margins get better?”

Prepare a detailed appendix in addition to the deck

Your deck should be simple and straightforward. During the pitch meeting, Selverian recommends having a detailed appendix that will answer any questions that come up.

Anu Duggal
Anu Duggal.
Getty/Noam Galai

Address the potential competition

One common mistake Duggal sees in pitch decks is “not addressing competition or figuring out the market landscape.”

She added, “When we think about investing in a company, we want to understand — that’s great that you have an interesting idea or you spotted something that has the potential to be an exciting business — but we also want to understand what is already in the market.”

Propose an action plan in a thank-you note

In your follow-up note after the pitch meeting, McGinnis said, “propose concrete next steps for them to react to — amorphous communication conveys amorphous management.” Reiterate specifically what you’re asking for, and ask whether there are other people you should meet who the investors can introduce you to.

You can also create FOMO by letting them know when another VC has already agreed to invest.

Determine whether you need to raise capital in the first place

If you’re bringing in a maximum of $1 million a year in revenue, “it may be a great, wonderful, much-needed business,” Rose said. “You may enjoy it and support your family.” But he emphasized, “the economics are just such that there is no way that you can get an investment from me at any reasonable number for that to make economic sense.”

This is because outside investors expect outsize returns on their money, often a large multiple of what they put in. And if there’s a low-millions ceiling on the revenue your startup can generate or eventual exit price, there’s not much incentive for a venture capitalist to write you a check.

In other words, your company may be a “lifestyle startup,” which doesn’t require venture capital and probably won’t ever be worth $1 billion.

david rose
David Rose.
Fortier Public Relations

Wait to raise capital until you have proof of concept

An entrepreneur’s pitch is a “combination of science and faith,” said McGinnis — but you want to stay more on the side of science than faith.

McGinnis often sees founders who don’t have any proof their idea is viable. You’d be wise to keep your day job and acquire customers and data before you ask a VC for money.

Read more: Keep your day job, move slowly, and don’t worry about building a unicorn: A New York ‘startup school’ eschews everything Silicon Valley ever preached

Meet your ‘B list’ investors first

Start with the “B team,” McGinnis said, i.e., the VCs who would be nice to have but aren’t your first choice. Get feedback from them so you’re more than prepared when you meet the VCs you’re really targeting.

Show why you — not just your business — are worth investing in

Remember that you’re pitching yourself, Rose said — not just your business plan. “You bet on the jockey, not the horse.”

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10 things in tech you need to know today

hasan minhaj white house correspondents dinner
Hasan Minhaj.
Reuters/Jonathan Ernst

Good morning! This is the tech news you need to know this Wednesday.

  1. A leaked internal survey from Uber shows that employees feel positive about the way the culture is changing, but also that they feel underpaid compared to peers. Just 40% felt they had fair compensation compared to other firms.
  2. Netflix removed an episode from its comedy show, “The Patriot Act with Hasan Minhaj”, from Saudi Arabia after the kingdom complained. The episode had been critical of Saudi Arabia.
  3. Convincing, artificially generated “deepfakes” are increasingly used to humiliate women by superimposing their faces into pornographic settings. Victims and abuse experts have warned such computer-generated videos are disproportionately weaponised against women.
  4. Netflix has poached its new CFO from Activision Blizzard according to Reuters. Spencer Neumann is expected to start his new role at Netflix in early 2019.
  5. Bill Gates is the latest high-profile executive affected by president Trump’s trade battle with China. Policy changes mean that his nuclear energy project, TerraPower, is scrambling for a new partner and a place to run a pilot.
  6. Experts have criticised Facebook’s opaque way of flagging potential suicide risks, saying they may cause further harm. The company calls the police to flag suicide threats, but experts said it isn’t always clear that its methods are accurate or safe.
  7. Dell has returned to the stock market after five years as a public company. Wall Street valued shares at $34 billion.
  8. Chinese ride-hailing firm Didi-Chuxing is expanding into financial services to diversify beyond its core business. The company will offer crowdfunding and lending nationwide across China.
  9. Chinese apps dominate the Indian internet, accounting for 44 of the top 100 apps. Familiar names like TikTok rank alongside newer players such as social content platforms Helo and SHAREit.
  10. Volkswagen is reportedly preparing to write off its $300 million investment in Gett. Gett, initially marketed as a rival to Uber, has failed to gain much ground against the competition.

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