Meet the two fintech startups that were selected for investment by a group of their peers
Village Capital and PayPal’s FinTech: US 2017 program wrapped up last week
For the past several months, Village Capital and PayPal with support from ecosystem partners have provided training and resources to twelve early-stage ventures that are addressing financial health.
Millions of families and small businesses in the United States are in a financial squeeze. Nearly 70 million Americans are unbanked, and many small businesses struggle to find fair and affordable access to capital and financinal services.
The twelve ventures that participated in our FinTech US: 2017 program (which concluded last week) are all creating innovative solutions for financially underserved consumers and small businesses. They’re a diverse group, working on solutions from affordable earthquake insurance to looking for more affordable remittance and money services.
Last week, on the final day of the program, the entrepreneurs went through Village Capital’s unique peer-selected investment process: as a group they selected two of their peers to receive an offer of investment from Village Capital.
Paykii: Helping immigrants manage their “second household” back home
Many recent immigrant living in the United States are actually managing two households: one in the US, and one back in their home country.
Last year, immigrants globally sent over $400 billion back home to family and friends to pay for utility bills and other basic needs. Sending these “remittances” can seem like a full-time job: sending cash can be burdensome, and it is hard to keep track of how the money is spent by loved ones, often elderly, living across an ocean.
Fabian Sade and Nelson Irizarry both knew this from experience, having managed domestic bill payment networks in Latin America where they saw first hand the challenges of paying bills on time in financially underserved communities. They founded a company, PayKii, that helps expats like them pay directly for loved ones’ water, electricity and other utility bills back home. Unlike other remittances services, PayKii coordinates a direct electronic payment to the utility company, rather than a cash transfer to the family member, which makes the process smoother and adds accountability.
Co-Founder Nelson Irizarry tells a story from their first month of operations, when the company was looking to work in Pakistan. They found that more than half of balance inquiries from utility companies were past due, meaning they hadn’t been paid on time. PayKii’s system has since started helping these Pakistani families pay their bills.
Though they are just over a year old, PayKii already processes over 100,000 transactions a month, with money going to thirteen markets in Latin America and Asia. They have partnerships with several major remittance providers, including Xoom (a PayPal service), and Al Fardan Exchange, one of the largest remittance companies in the United Arab Emirates.
Finix: Getting payments in people’s hands, faster
Imagine you’re an Uber driver. You’ve finished your all-night Saturday shift, and want to use some of your hard-earned cash to pay a bill, or enjoy a movie. Except you’re not paid right away, you need to wait for the middle of the week to receive a weekly direct deposit into your bank account.
Gig economy workers are just one group of people that are limited by antiquated systems like paper checks or Automated Clearing House (“ACH”) direct deposits, which can take up to three days to process. Finix co-founders Richie Serna and Sean Donovan hit on a solution: their product enables push payments over debit card, allowing for real-time disbursements to debit cards anywhere around the world.
Richie and Sean came to this idea from personal experience. Richie talks about growing up with family members who were underbanked and living check-to-check. “They didn’t have a checking account, so they would get paid through check-cashing businesses, which were both slow and had high transaction rates,” he said.
The co-founders are excited to test their idea in creative ways, like coordinating easy payments from a class-action lawsuit, or dispersing funds around hurricane relief. Last month Finix closed a $2 million seed round, and they’re building from there.
FinTech: US 2017 was part of a broader collaboration between Village Capital and PayPal throughout 2017 and 2018 to support financial technology innovators in the United States, Latin America , India, and sub-Saharan Africa. This collaboration is expected to support dozens of unique solutions to financial challenges faced by individuals and small businesses worldwide.
Thank you to everyone who participated in FinTech US: 2017. Find our more about the program here.