What Are Some Interesting Startups in the Finance Space?
We’ve rounded up some interesting startups in the finance space to give you an idea of what’s on the horizon. Some of them are looking to disrupt specific industries, while others are creating tools that help businesses save time and money with automation.
Cowrywise is a personal finance app that helps users make the most of their money. Its services include better financial planning, smarter savings, and targetted investing.
Revolut
Revolut is a London-based fintech startup that offers banking, investing and currency transfer services to customers around the world. It is currently valued at $33 billion.
Revolut’s mission is to create a global financial “super app” that allows customers to manage their entire banking needs on one platform. It provides a number of products to individuals and businesses, including free bank accounts, debit cards and currency exchange.
The company is headquartered in London and has offices in Paris, New York and Stockholm. It has a European Banking License and is applying for a UK full banking licence.
In the UK, Revolut offers two types of current account: a basic subscription account and a premium one that includes travel insurance, crypto access and free access to global money transfers. It also offers a debit card on the Mastercard network, which is linked to your account.
As of June 2020, Revolut has 16 million users globally and offers banking services across payments, savings, crypto-investing, expense management, etc. It also has a mobile application that allows users to send and receive payments instantly or request them from their contacts in the Revolut app.
Revolut also provides a service to buy and sell cryptocurrencies using 25 fiat currencies. It charges a fee of 1.49% for buying and selling cryptos.
Founded in 2015 by Nikolay Storonsky, Revolut is a London-based startup that is focused on providing mobile and online banking services. The startup aims to avoid the excess fees of traditional banks by providing users with a free pre-paid Revolut card that can be used to make purchases at retail outlets.
Revolut is backed by SoftBank Vision Fund 2 and Tiger Global. The investment is a boost for Revolut as it seeks to expand into more profitable offerings and add banking licences in the US and Singapore.
Kuda
Kuda is a fintech startup that offers mobile and online financial services to customers in Nigeria. Its services are offered to both personal and business accounts. Its main services include savings and borrowing. It also has an app that allows users to monitor their accounts and keep track of expenses.
It offers 25 free transfers each month, a feature that many users find helpful. However, it does charge a small fee to make extra transfers.
The company was founded by Babs Ogundeyi and Musty Mustapha in 2019. It is headquartered in London, UK, and operates in Nigeria.
In 2021, it raised $55 million in funding from investors including Valar Ventures and Target Global. The funding comes on the heels of some impressive growth for the startup.
For starters, it is the first fintech to secure a banking license from the Central Bank of Nigeria. Its business model is built around bringing banking services to people who still hold accounts with traditional banks.
While Kuda Bank primarily offers banking services, it has also launched a remittance service that allows people to send money from Nigeria to other countries. This has enabled it to gain access to new markets in Africa.
Another important product Kuda has added is overdrafts, which are essentially revolving credit for individuals. These loans are designed to be short-term and repaid within days or weeks.
The overdrafts offer a daily interest rate of 0.3 percent and come with the right to levy additional charges if the borrower does not repay it on time. The bank will take legal action if the loan is not paid back by its maturity date.
Kuda is currently only available to Nigerians, but it plans to expand its service to other African countries in the future. The company also recently laid off some employees in an effort to cut costs and extend its runway.
GoHenry
A lot of neobanks are known for targeting adult consumers and opening their first checking, savings or investment accounts, but there are also plenty of startups building services that target younger audiences. This is an especially attractive niche for fintechs, who can often get away with doing business in ways that aren’t regulated by the same authorities that govern banks.
GoHenry, for instance, is a fintech startup that has developed a debit card and app designed to help kids learn about money and financial literacy. It aims to make every child “money smart” by giving them a sense of control over their own finances and teaching them about the relationship between work and earning money.
It provides a prepaid debit card that is typically topped up by parents and a “financial education” app with unique parental controls for kids between 6 and 18 years old. It also offers a way for parents to set up automatic pocket money payments, or to create “paid chores” that their children can complete in exchange for earning extra cash.
The service has been profitable since March this year, and it has seen substantial growth in recent years. It claims that its customer base doubled every year over the last six years.
GoHenry has raised $40 million in growth funding, and it plans to use this new round of money to expand its business in the US and UK. It’s a round led by Edison Partners and Revaia (formerly Gaia), along with a strategic investment from Italian payments company Nexi.
Finotta
Finotta is a fintech startup based in Overland Park, Kansas. It provides a platform that allows banks and credit unions to personalize their mobile banking experience. It helps them increase engagement, combat larger financial institutions and create new revenue streams.
The startup’s software uses algorithms to analyze a customer’s financial lifestyle and predict what that person will need moving forward. It then promotes financial services that fit those needs.
It is aiming to help community banks and credit unions build better apps that can compete with digital-only banks and other companies offering a superior mobile experience, according to CEO Parker Graham. The company received $3 million in seed funding last fall.
In this episode of Once Upon a Startup, hosts Davis McEntire, Victoria Dickerson and Jeff Amerine discuss Finotta’s approach to personalization in banking. They talk with Parker Graham, the company’s founder and CEO, about his journey to success.
One of the biggest challenges for banks is bringing their mobile app to market, particularly since so many competitors are offering similar functionality. Finotta’s predictive software determines the financial journey of a retail customer, supports them through that journey and finds banking solutions that can save them money, increase their net worth and improve their financial health.
To make that happen, Finotta has built a platform that can be embedded within a bank’s existing mobile application. This enables the bank to deliver personalized financial guidance to customers and adds compassion to their overall banking experience.
To drive its growth, Finotta has also expanded its team. It has recently hired Cory Miller as Head of Sales, with nearly 15 years of technology-specific sales experience. He previously held a similar role at V2Verify, a digital authentication platform. It has also promoted Kelsey Houghton to Chief Product Officer and Eric Swanson to Chief Technology Officer.
Figure
The finance space is booming as online financial services have grown. This has led to a number of interesting startups in this space. Some of them are aimed at the small business market and others focus on security.
One startup in the finance space is Figure, which operates a blockchain-based financial service for personal and business use. The platform offers products like mortgages, home equity loans, and personal loans. It also has features for asset management, cap table management, and marketplace services.
Another startup is Stockal, which helps retail investors abroad invest in companies in the US. They started out as a research and investment firm but shifted to a digital infrastructure company in 2018.
A third startup is Ecolytiq, which helps businesses calculate the environmental impact of their purchases. They recently partnered with Visa to expand their service to credit card users.
Finally, there’s Founderpath, which allows SaaS companies to borrow money by using their monthly revenue as collateral for a loan. The company has financed over 3,000 startups and currently approves approximately $1M per week in financing.
Startups aiming to raise capital from investors usually need a comprehensive set of documents to convince potential investors that their product or business model is worth the funding. This could include a one-page teaser, pitch deck, extended business plan, financial model, cap tables, and more. This documentation will help investors understand the financial forecasts and projections of a startup before investing in it. The more detailed and comprehensive the documents are, the better the odds are that a potential investor will be satisfied with the company’s financial performance and investment.
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