As 2023 comes to a close, we’re here to look back at the biggest fintech stories of the year. Silicon Valley Bank’s implosion felt like a fintech story in that a number of startups (Brex, Arc and Mercury, for example) in the space leapt to fill the hole left by its collapse. But it truly was a story that affected all industries — and founders and investors alike. And one that continues to play out.
Ironically, one of 2023’s biggest stories involved a tech giant and not a startup. In April, Apple shared that Apple Card customers in the U.S. could open a savings account and earn interest through an Apple savings account, as reported by Romain Dillet. At the time, Apple was offering a competitive APY of 4.15%. The company partnered with Goldman Sachs to offer the feature, but by year’s end, that partnership had fallen apart (an event we saw coming) and it was not yet clear who would be taking Goldman Sachs’ place.
Another one of our most read stories of the year also involved a financial services giant rather than a startup. Manish Singh wrote about the fact that Mastercard’s CFO had declared that India’s UPI was “fantastic at many levels” but remained an “incredibly painful experience” for ecosystem participants who ended up losing money as a result. The commentary underscored tensions around the mobile payments rail that facilitates over 10 billion transactions monthly in the nation with low card penetration.
In July, Rita Liao covered the fact that China’s two dominant mobile payment solutions, WeChat Pay and Alipay, had announced that foreign users could now pay at Chinese retailers by linking their foreign credit cards, including Visa, Mastercard and Discover. This was a big deal, as it was historically difficult for travelers to go cashless like locals. Previously, using WeChat Pay and Alipay in China required a local bank account, making it challenging for short-term visitors to use those payment methods.
In late June, I broke the news that credit card giant Visa would be acquiring Brazilian payments infrastructure startup Pismo for $1 billion in cash in what was expected to be one of the largest fintech M&A deals taking place all year. The deal closed later in the year. Visa was reportedly just one of several companies bidding for the startup, which was not seeking to be acquired, or even fundraising. Pismo getting scooped up by Visa was a coup of sorts for the entire Latin America region, which saw a surge in global investors pouring capital into the region in 2021 and a bit of a retreat only a year later.
When Sam Altman is involved in a venture, people take notice. Christine Hall reported in late September that Slope, a business-to-business payments platform for enterprise companies, had closed on a venture round of $30 million to expand its business. The round “included major participation from OpenAI’s Sam Altman.” The core of Slope’s technology is order-to-cash workflow automation utilizing artificial intelligence-driven tools for checkout, customer and vendor risk assessment, payment reconciliation and cash management.
People love to read about others’ missteps. In an attempt at damage control, the CEO of the equity management startup Carta, Henry Ward, in October emailed customers, telling them that if they were concerned about “negative press” tied to the outfit, they should read a Medium post of his. The move — as covered by myself and TechCrunch Editor in Chief Connie Loizos — appeared only to call more attention to the many reported problems plaguing the 11-year-old company. An investor in Carta — which was most recently assigned a post-money valuation of $7.4 billion in 2021 when it last raised an institutional round of funding — even called Ward’s decision “weird.”
In a bit of a surprise move, Robinhood announced in late June that it was acquiring X1, a no-fee credit card startup, for $95 million in cash. X1, which offers an income-based credit card with rewards, had raised a total of $62 million in venture-backed funding. Why X1 in particular over the many other credit card startups out there? We believe it was because of the fact that X1 had plans to launch a new trading platform that would give its cardholders the ability to buy stocks by using earned reward points. Its CEO even singled out Robinhood as a company he was hoping to compete with.
A new venture firm, called Vesey Ventures, that was founded by three female former managing directors of Amex Ventures, announced it had closed a $78 million debut fund in early April. During their time at Amex, the firm’s three founding partners worked on investments in companies such as Plaid, Stripe, Melio and Trulioo. The fact that there was more capital for early-stage fintech startups got our readers’ attention. Bonus: We did a bit of a deeper dive into Apple’s fintech aspiration (mentioned above) here as well.
We never thought we’d see the day. In August, digital mortgage lender Better.com went public via a long-delayed SPAC. No one expected it to perform well in its public debut. And it didn’t. The company’s executive team likely knew it wouldn’t perform well but moved ahead anyway, for a variety of reasons that Alex Wilhelm and I detailed here. As of December 20, the stock was trading at a mere 63 cents.
In mid-May, Manish reported on the fact that founders of ZestMoney had resigned from the startup. The Indian fintech, whose ability to underwrite small ticket loans to first-time internet customers, once drew the backing of many high-profile investors, including Goldman Sachs. By December, Manish had reported that ZestMoney was shutting down following unsuccessful efforts to find a buyer. The Bengaluru-headquartered startup — which also identified PayU, Quona, Zip, Omidyar Network and Ribbit Capital among its backers — employed about 150 people and had raised over $130 million in its eight-year journey.
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