Welcome to The Switch! If you received this in your inbox, thank you for signing up and your trust. If you read this as a post on our site, please subscribe here so that you can receive it directly in the future. Each week we look at the latest fintech news from the past week. This includes everything from funding rounds to trends to an analysis of a particular space to hot takes on a particular company or phenomenon. There’s a lot of fintech news out there and it’s our job to stay on top of it – and understand it – so you stay informed. — Mary Ann And Christine
Hello Hello. Christine and I strayed a bit from our typical fintech coverage this week to do some investigative reporting. We’ve looked New chip, an Austin-based accelerator that recently imploded. In our humble opinion, it is definitely worth a read. While it wasn’t aimed exclusively at fintech startups, it’s a complex story of a troubled accelerator that claimed to help entrepreneurs be “successful.” Some founders claim it did anything but, while a group of employees were so dissatisfied with the way the company was being run that they walked out en masse more than two weeks ago. There’s been a lot of back and forth going on, and while we’re not sure what went on behind closed doors, it’s sad to see any organization focused on serving the startup community end up in this situation, especially for the affected founders and employees.
On a pure fintech note, we saw a wave of insurtech funding rounds last week! TechCrunch reported on four such increases alone, including Wefox, Obie, bolt tech And Figorr. This prompted TC+ editor Alex Wilhelm to dig deeper and conclude that “despite messy IPOs, there are good reasons to be optimistic about insurtech startups.” — Mary Ann
Move over Apple, Step launches 5% savings account
Every time I’ve looked at the monthly dividend in my bank account for the past few years, I’ve said to myself, “The bank can actually just keep that 6 cents.” Well, neobanks and other fintech companies believe we should get better returns as well.
This week I wrote about Step, the digital banking service aimed at teens and young adults, announcing a whopping 5% for its savings accounts.
While the rate is important I do want to point out how widely known it is that few Americans can come up with $400 in an emergency so it’s nice to see Step and others focusing on ways to motivate people to do more save.
The news comes about a month after Apple launched its 4.15% savings account rate. Step co-founder and CEO CJ MacDonald told TechCrunch that the company’s goal has always been to offer the highest rate; however, one wonders whether Apple’s entry into the market may have inspired neobanks and other financial organizations to close the gap.
Find out how Step’s 5% account works. — Christine
As reported by Manish Singh: “Founders of ZestMoney have resigned from the start-up, the latest twist in the fortunes of the Indian fintech whose ability to secure small card loans to new Internet customers once gained the backing of many high-profile investors, including Goldman Sachs. Lizzie Chapman, Priya Sharma and Ashish Anantharaman, the founders of ZestMoney, informed employees of their decision on Monday.” More here.
Having recently acquired another startup, Ribbonreal estate fintech EasyKnock confirmed that it has laid off 10% of its employees. A spokesperson told TechCrunch the decision was “part of a larger effort to accelerate the company’s path to profitability and ensure the company’s long-term sustainability.”
In the WTF section of our newsletter: The Revolut UK chief told the customer he would be waiting for him with a shotgun.
If it feels like a corporate spend company is releasing new features every week, it’s because… that’s pretty much what’s happening. Here’s the latest: Disaster to introduce AI tools for business expense tracking. Also, Fintech Disaster launches money-saving AI tools for businesses, Microsoft CEO announces, more like investors.
Truist invites clients to play the ‘Long Game’ financial wellbeing (TechCrunch covered the news as Truit acquired Long Game in an effort to appeal to a younger demographic in 2022.)
Financing and Mergers and Acquisitions
Seen on TechCrunch
Wefox secures new funding with a $4.5 billion valuation as it strives for profitability
UK pension start Smart banks $95 million
Cold-chain startup Figorr raises $1.5 million, supports rollout of data-driven insurance for perishables
M-KOPA raises $250M+ equity for its asset financing platform
Spiff Begins ‘Massive Overhaul of Key Sales Commissions Engine’ Following $50 Million Series C
Insurtech bolttech is getting $196 million at a $1.6 billion valuation from investors like MetLife
Axis, Backed by Tiger Global, Launches Digital Payments Platform for Egypt’s SMBs, Months After It Was Worth $8.25M
Percent secures $30 million investment to connect investors with private credit
Landlord-focused insurtech Obie rakes in $25.5 million led by Battery Ventures
Buying platform Zip raises $100 million at a valuation of $1.5 billion
Thanks again for reading and all your support! We are grateful. See you next week! xoxoxo, Mary Ann and Christine
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