EU-STARTUPS: In the last decade, there were a bunch of really successful fintech companies that started in Europe. Companies like Klarna, Adyen or Transferwise (to name just a few) changed the way we do payments or the way we transfer money overseas. By pursuing radical new concepts, these fintech startups became some of Europe’s most valuable companies within just a few years.
The financial technology sector is hot, the summer heat is on, so let’s look at Europe’s hottest fintech startups in 2015. In order to present you the “next wave” of Europe’s fintech disruptors, we scanned the market for the most promising startups out there that are not older than 3-4 years. And here is our list of Europe’s hottest fintech startups in 2015:
Azimo: Founded in 2012 and headquartered in London, Azimo was created out of the founders frustration with the money transfer industry. They experienced so much waste, cost and poor customer service that they decided to create a better way to send money overseas. Well, the Azimo founders could have used Transferwise, which was founded two years before, but they chose to compete with them and especially with older money transfer providers like traditional banks. In total, the ambitious team behind Azimo already raised $31.6 million in venture capital.
Bitbond: A peer-to-peer bitcoin lending platform with mission to make lending and borrowing globally accessible. Small businesses like ebay sellers who need to finance working capital and inventory list their loan request on Bitbond after going through a credit check. The loans get funded by individual and institutional lenders who thereby earn interest with their bitcoins. By leveraging bitcoin as a technology and payment network, Bitbond sees itself as the first global marketplace lender for small business loans. So far, the Berlin-based startup which was founded in 2013 raised about $940K in seed funding. Read the full article
TECHCRUNCH: Fintech startup and Y-Combinator alum GoCardless, which offers a simple way for online businesses to set up and accept recurring payments (a.k.a. direct debits), hit a major milestone this week. The London-based company is now processing over $1bn each year.
It also recently expanded from the U.K. to France, and is currently conducting a beta in Germany, in an attempt to consolidate and simplify the process of accepting direct debits the world over.
This afternoon I got on a call with CEO and co-founder Hiroki Takeuchi to hear the GoCardless pitch and catch up on the startup’s latest news. We also talked candidly about what it’s like when two of your co-founders leave, and the moment GoCardless pivoted to become the success and fintech darling it is today. Listen to the full interview
WIRED: A lot has changed since Adyen’s CCO Roelant Prins worked at RBS in London. For one thing, payments is now “the most exciting thing on Earth,” he tells the audience at WIRED Money 2015. Retailers and services today rely on retaining customers by offering them a totally frictionless payment method, and Netherlands-based Adyen has been working since 2006 to provide that.
The company, which counts Booking.com, Spotify, Airbnb and Dropbox as customers, sells itself as a single global platform for accepting payments anywhere in the world. It means if you are a young startup looking to scale or a multinational wanting to streamline and save money, you can take payments anywhere in the world in a way that works for the local culture.
“You have to start with the consumer side,” says Prins. That means first looking at spending habits. One of Adyen’s best assets is its data. It has a country by country quarterly mobile index which shows what volume of payments originate from mobile devices. Unsurprisingly, iPhone takes the greatest share, and payment models can adapt for this.
Naturally, if so many transactions are happening on mobile, it’s important for retailers to look at social platforms to secure sales. As an example of this, Adyen recently helped KLM setup a payment link they can share on Twitter for customers to upgrade their journey. “It works really week. People are making changes on the spot.”
WIRED: The entire banking industry can be disrupted for the better and bricks and mortar banks are “heading for tough times”, according to Taavet Hinrikus, founder and executive chairman of TransferWise.
“Every vertical in banking is a huge opportunity,” Hinrikus told the audience at WIRED Money 2015. “As a consumer, I’m definitely waiting for what’s going to come after banks.”
Previously Skype’s first employee, Hinrikus is now challenging the established financial industry and helping money flow more freely than ever.
TransferWise, the company he founded in London in 2011, is now worth more than $1bn (£649m) and already has a two percent market share in the UK. The company works by avoiding foreign exchange fees, making international money transfers less expensive. TransferWise is currently handling more than £500m a month, saving customers £22m in fees per month. But Hinrikus has ambitious expansion plans.
He looks to Skype as an example of the disruption technology can bring. In a decade the firm, now owned by Microsoft, has snared 40 percent of the global market in international calling — and Hinrikus believes similar success stories will soon be found in fintech.
TECHCRUNCH: While Greece and its creditors continue to play a game of chicken, a startup out of Germany putting a big data spin on the business of loaning money is raising a large round of funding.
TechCrunch has learned that Kreditech, an online finance startup that loans money to consumers who have little or no credit rating, is raising around $110 million in a Series C round of funding. One part of that has already been secured from one of the better known VCs and entrepreneurs in the startup world. €37.5 million ($44 million) is coming from investors that include Peter Thiel, one of the co-founders in PayPal and a prolific investor who has backed Facebook, Palantir and many others.
The rise of Kreditech speaks to a big upswing for “fintech” startups, with others out of Europe like WorldRemit, TransferWise and Funding Circle all raising large rounds of funding, and larger M&A movements pointing to a bigger growth for the space overall as tech businesses continue to disrupt the traditional banking system. Just last week, PayPal acquired Xoom for $890 million. Read the full article
WIRED: NUMBER26 wants to become Europe’s first solely digital bank, and cofounder Valentin Stalf thinks he knows how to get there: design.
“Design has changed a lot of industries: fashion, travel, music,” Stalf told the audience at WIRED Money. “Design may be user experience, but it’s also about user interface.” And if you want to be digital-only, this is where you need to excel.
Berlin-based NUMBER26, which raised £7.3m in Series A funding earlier this year, uses simple interfaces optimised for mobile to make finance simpler. It means you can signup, carry out transactions and even block and unblock your bank card from within the app.
“Normally you have to sign up to a bank account on paper. With ours you can do it on a mobile phone in around four minutes. At a traditional German bank it takes one and a half hours at least to sign up ‘to get to know the customers’.”
Customer behaviour has changed dramatically, Stalf argues, and banks should be communicating with customers in a way that makes their life easy from the very start. “Banks tend to write much too much information, it’s always text heavy. We try to do everything digital in a way people like to read it.”
“When most people first activate their [traditional] account, they are overwhelmed by the information they are getting. Most people don’t know what’s important to them. Sometimes they don’t even know how their interest rate is paid out. We tried to prioritise information, and bring much more intelligence into the account.”