All Access

Fintech Deals

Standard

Fintech Deals Alerts

Alert

Fintech Deals Thought Bubble

Thought Bubble

mustard

BFD Expert Voices - Private Credit

BFD Expert Voices

Betsy and Daniel Cohen, fintech SPAC and embedded finance pioneers, are rebranding their investment firm Cohen Circle and diving deeper into impact investing, Ryan writes.

Driving the news:  Cohen Circle consolidates all the public, private, and venture investments the mother-son duo have made, which totals more than $5 billion in capital raised.

Of note: They plan to double down on fintech investments, particularly in embedded finance, while launching an impact investing arm with an all-women team. 

Amanda Abrams became CEO of the firm in 2021. She had been general counsel at CardConnect, the first company the Cohens took public through a SPAC merger, and served as managing director for many of the SPACs that followed.

Context: As founders of The Bancorp, one of the first federally regulated entities to offer banking services to non-bank tech companies, the Cohens helped pioneer the concept of embedded finance before it had a name.

More recently, the pair have taken several fintech firms public through a series of SPAC mergers, including companies like CardConnect, International Money Express, Paya, Payoneer, and Perella Weinberg Partners.

While best known for their SPAC investments, they also have made late-stage venture investments into companies like Taulia, BillGo, Railsr and Ocrolus.

What they're saying: "There is a wide variety of needs to be served, so we decided that we would broaden the description ... because it really is a circle," Betsy says. 

"It's a circle of experience, knowledge, networking, deal identification, understanding business models — a whole range of things that are all a part of that circle." 

On launching an impact fund with an all-woman team:

"Providing women of deep knowledge, great accomplishment and stature the opportunity to be front and center on a cutting-edge investment team is important."

"I'm old enough to have been the first in many things ... and I'm sensitive to the fact that, as was said, 'You can't be it if you can't see it.'"

"SPACs are a tool that, for the right company, with the right management team and the right product that needs capital, they're the right answer." 

"We will continue to be active in the sense that we'll be looking for opportunities and the right companies. But the market of investors has shifted its interest, so we put that in our back pocket."

1 big thing: Cohen Circle looks to make an impact

Betsy and Daniel Cohen. Photo: Cohen Circle

Cherry, a payments and invoice tracking company based in New York City's Brooklyn borough, raised $4 million in seed funding led by NFX, the company tells Lucinda exclusively.

Why it's the BFD: Much of the SMB market currently still uses paper checks to make payments to vendors. 

Details: Now valued at about $20 million, Cherry integrates into a company's existing accounting software and bank so customers do not need to learn a new system and can onboard customers in minutes, says Cherry CEO Moshe Teitelbaum.

Cherry allows its users to pay for invoices directly from their accounting software.

When a customer is ready to make a payment, Cherry takes care of getting the vendor's banking information and automates the transfer of necessary invoice records.

That also allows both vendor and buyer to track payments. For a management company paying out of multiple entities, that also helps ensure they aren't making double payments.

Cherry is currently focused on mid-sized businesses with complex finances — ones with multiple bank accounts or several entities, such as nursing home or rental home operators.

How it works: The company charges a flat fee of $1.50 to $2.50 per transaction and also makes some revenue from interchange. 

It has processed some $300 million in transactions.

The big picture: Companies like Intuit are eyeing ways to automate the messy payments and invoicing process for SMBs, which in theory could eventually make Cherry redundant for users of Intuit's Quickbooks.

But Cherry also integrates with more industry-specific accounting software makers like PointClickCare (for nursing homes) and Yardi (for real estate management) — with Teitelbaum betting that Cherry's ability to connect with various systems rather than creating a walled garden will be its winning ticket.

2. The BFD: Cherry's $4M seeding

Coinbase told to tackle "organizational deficiencies" in Germany (FT)

BaFin, Germany's financial watchdog, ordered Coinbase Germany to ensure that it has adequate risk management and internal controls in place following an audit of its financial statements.

U.S. consumers have been remarkably strong, financially speaking, despite the recent downturn. But data from the Federal Reserve shows a change in the works. Growth in credit card death slowed, growing 8.7% in September compared to the same period a year earlier.

It had been growing in double digits in previous months.

3. Credit score

Illustration of a credit card headed towards a goal post to score a touchdown.

• Hopper, a travel booking app, raised $96m in follow-on funding from Capital One. https://axios.link/3Ujf5wv

• Archax, a U.K.-based digital asset exchange, raised $28.5m in Series A funding led by Abrdn, with participation from Bitrock Capital, Blockchain Coinvestors and the Tezos Foundation. https://axios.link/3tdvzdO 

• Glow, a San Francisco-based digital insurance agency for small businesses, raised $22.5m in Series A funding. Cota Capital led and was joined bu AV8 Ventures, Markd, Startup Venture Capital and Maiden Re. glow.co/

• Fordefi, a DeFi wallet maker for institutions, raised $18m in seed funding. Lightspeed Venture Partners led and was joined by Alameda Research, Jump Capital, and Castle Island. https://axios.link/3hottFc

• Doola, a New York-based startup that helps foreign founders start LLCs in the U.S., raised $8m. Nexus Venture Partners led, and was joined by YC, Hustle Fund and Vibe Capital. https://axios.link/3WMOlpK 

• Coinmetro, an Estonia-based crypto exchange, raised €7m in strategic funding at a $180m valuation. https://axios.link/3tcpkXD 

• Atlar, a Swedish business payment automation startup, raised €5m. Index Ventures led, and was joined by La Famiglia VC and Cocoa. https://axios.link/3UhT69t

• Worldline will acquire Italy-based Banco Desio’s merchant-acquiring activities for €100m euros. https://axios.link/3NLbzIN

• Voya Financial (NYSE: VOYA) agreed to acquire Benefitfocus (Nasdaq: BNFT), a Charleston, S.C.-based benefits administration tech provider, for roughly $570m in cash. https://axios.link/3fHzSLc 

• Quona Capital, a Washington, D.C.-based emerging market investor, closed its Fund III at $332 million, above its $250 million target. quona.com

• LeadBlock Partners, a crypto-focused venture firm based in London and Paris, is seeking to raise €150m. https://axios.link/3hozRMS 

4. Deals of the day

• Facet Wealth, a Baltimore-based financial advice startup, named Personal Capital’s Vince Maniago as its chief product officer. https://axios.link/3ThJ6LN 

• Silvergate, a crypto-focused bank, promoted Ben Reynolds to the role of president and appointed Kate Fraher as its chief risk officer. https://axios.link/3WLELni 

• Reuben Lai is leaving his position as executive director at GXS Bank, the digital bank joint venture between Grab Holdings and telecom Singtel. https://axios.link/3UlbGx8 

5. It's personnel

🗳 Good morning! It's Tuesday, but more importantly, it's Election Day.

✏️ Thanks to George Moriarty for editing and Carlos Cunha for copy editing this newsletter.

And thank you for reading Axios Pro Fintech Deals! Please ask your friends, colleagues, and arch-enemies to sign up!

November 08, 2022

1 big thing: Cohen Circle looks to make an impact