BlackFin Tech Weekly — November 18th

It’s been a busy week for European startups, with a lot of significant rounds announced among the 13 and more than €80m raised.

The UK, as usual, led the way with 5 deals, and it’s interesting to point out the 3 Nordics rounds (2 in Sweden and 1 in Denmark). France & Spain followed. In terms of Fintech subcategories, not many surprises too with 5 Banktech deals and 5 Payments ones, followed by Investment Banking & Wealth Management.

We included the 2 impressive rounds of Eigen Technologies and Cutover in our Fintech analysis as they both have most of their clients in the Financial Services industry. Here is the eternal debate: should a startup adopt a generalistic approach regarding its busdev, or on the contrary is verticalization an easier path to success?

Few comments on Eigen’s $37m round:

• Eigen Technologies helps its clients “turn its documents into data”. Thanks to Natural Language Processing, its solution analyzes thousands of its client’s documents to obtain the data they need and extract insights from complex documents like contracts. Its way of exploiting Machine Learning is really differentiating: Eigen doesn’t need massive data sets to train its algorithms and only needs “small data” in its approach, which shortens its deployment and go-to-market.
• The startup has an impressive list of clients in Financial Services, with now more than 14 paying customers such as Goldman Sachs, ING or Hiscox. This funding round will allow the company to also focus on other verticals like healthcare and insurance. The company stated that its recurring revenues were multiplied by 6 since June 2018.

The problematic of data is increasingly gaining tractions in Financial Services, on many angles - which range from gaining efficiency to complying with regulations. Indeed, The recent regulatory evolutions such as GDPR or MIFID 2 shed more than ever light on Financial Institutions' responsibility to preserve and respect rules regarding clients’ sensitive data, as well as reporting. In this context, Eigen Technologies argues that to make better use of your data, you don’t have to outsource its analysis thanks to its solution. In an indirect way, a lot of startups are nowadays tackling these issues in the Fintech world, with new data anonymization techniques or even production of new types of data like synthetic data.

The Acatus’ round is also interesting as it confirms CrossLend path, which announced a €35m round in October with Santander InnoVentures. Both companies are trying to boost efficiency in debt capital markets, by making debt assets more transferable and these markets more liquid.

As Plum is announcing its $3m round (led by ERBD, which is not a traditional VC player to say the least), the PFM & micro saving space is still booming in some specific Western Europe countries:

• Bruno, Yeeld, Cashbee in France;
• Goin, Arbor and of course Fintonic in Spain;
• Oval Money in Italy;
• Plum, Cleo, Chip, Ynab, MoneyDashboard in the UK;
• In Germany? What’s happening with Germany?

We see 2 main trends within this sector:

• a “Squirrel” play, ie: the pure wealth management play, with an AuM-based model
• a “Frog” play, ie: the end-to-end payment experience within a social ecosystem, enabling shopping within the app, with a transaction fees-based model

For sure, the equity stories and paths to exit may be very different for these 2 different strategies, as ”everyone is becoming a bank” (see the GAFAM’s moves…). The Frogs may jump higher or sink; while the Squirrels may keep calm and gather step by step wealth/food, or maybe only food for thoughts…

Anyway, congrats also to Cardlay, PEJ, CapitalRise, Chaser, Pandat Finance, Finfrog, Zaver, Micappital & Worldcoo for these milestones!

//And what else?

• Meet next week Michele at Slush, Romain in Frankfort, Maxime at DIA in Munchen, at Global Venture Summit in Luxembourg (invited by our friends at The LHoFT ) and in London too, and me @ CFO Day in Paris and at Occitanie Invest in Toulouse.
• Also our Julien is applying to France Digitale’s board, here are few words about his application.
• Have a look at our Linkedin page to have some insights about our portfolio news & recruitment, our events, and activity!
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• Did we mention it was Romain’s birthday? HB!