FinTech picks up the big cash again as $55 million series B round empowers Curve
Shachar Bialick, CEO of Curve, considers this particular fintech company to have an advantage over others as it is a technology company and not a challenger bank.
London’s financial technology innovation prowess is yet again attracting the attention of large scale venture capital investors, this time with one of Britain’s many disruptive challengers to the traditional financial services industry having gained a series B round of funding from three major firms.
The direction which is being taken by seasoned investors with a vast portfolio under their belt is demonstrative of the confidence that those who know how to spot a potentially big business opportunity are placing in the challenger banks and new style of investment and fintech companies with their own infrastructure emerging from London.
It is very hard to get funding to start a margin brokerage, and in some cases it is nigh on impossible to even open a commercial bank account to hold operational capital, or a segregated account for client funds as banks have been shying away from margin brokerages, especially those without their own intellectual property being held on their own systems, which in some cases has had detrimental effects.
Additionally, prime brokerage divisions of banks have been curtailing the extension of counterparty credit to the OTC derivatives sector, resulting in more market making and a resultant understanding that banks and investors do not want to participate in funding, meaning most brokerages have to either bootstrap their business or rely on revenues to organically grow.
The dichotomy between this viewpoint and the contrasting perspective from investors when approaching new age fintech disruptors is vast, with VC companies lavishing cash.
This time, Curve, a company that consolidates multiple bank accounts and cards into one smart card and app. It has over 500,000 customers, and is supported by teams of more than 150 people in its London and Bristol offices, Bristol being another center of financial services. Once home to the majority of Britain’s insurance companies, Bristol is home to the largest retail financial services company in Europe, Hargreaves Lansdown.
Curve’s Israeli CEO Shachar Bialick considers the company to be totally different to others. He said “Curve is playing a completely different ball game. It is not a challenger bank which means that we can focus on creating a radically better customer experience, without asking customers to trust their salaries with us, or the significant overhead of becoming a regulated bank. Receiving this level of investment from such prominent investors is a fantastic endorsement of the value and experience Curve brings.”
Curve is already available in 31 European countries and plans to use the fresh funding to expand its product offering in the UK, Europe and overseas.
The startup said it will officially launch into six European markets later this year – France, Germany, Italy, Poland, Portugal and Spain – and aims to launch its operations in the US by mid-2020.
It is now valued at $250m, which Curve has officially stated places it in the top five UK consumer-focused fintechs next to Transferwise, Monzo, Revolut and Starling Bank, and this round of funding was led by Gauss Ventures and participated in by Creditease and IDC Ventures.
This is the second example of a large funding round having taken place in a very short space of time, hot on the heels of former interbank FX trader Aritra Chakravarty who quit his position at HSBC as Global Head of Digital FX and is now looking to change the whole retail sector, with willing investors behind him as his company, Dozens, secured £3.8 million in funding via Seedrs at the beginning of May.
Mr Chakravarty, who comes from HSBC, where he was Global head of Digital FX and investment products, he decided to go the modern route and combine his expertise with London’s incredibly empowering new age financial technology environment to create a challenger bank, majoring on high end fully digital solutions.
It may have been a year in the making, as Mr Chakravarty embarked on establishing his new firm in June last year, however yesterday evening he closed a major deal with crowdfunded investors to develop new products, and grow the business.
In London, it would appear that those in senior positions in the banking technology sector who think they can do it better themselves, are the ones that will drive the retail financial services sector forward.