Lemondade finalizes a claim in 2 seconds. Banks are moving to AI. Truework raises a round. Here's what we've been watching this week….🧐
Pinned to the Top
Wells Fargo and the Latino civil rights group UnidosUS are unveiling a multimillion-dollar plan to help 4 million Latinos buy homes by 2030, Axios' Russell Contreras reports.
- Both announced that they are kicking in $10 million each as part of a $100 million fundraising effort aimed at changing federal and local policies to make loans more accessible, and provide counseling for Latinos seeking to become homeowners.
🖼️ The big picture: The homeownership rate among Latinos reached 49.7% in the first quarter of 2023 — but is about 25 percentage points lower than non-Hispanic white Americans.
- Advocates say that low rate is a warning sign for the nation's financial future, since the Latino population in the U.S. is projected to grow by 12 million every decade until 2060.
🔬 Zoom in: The $20 million kickstart funding will launch an initiative called HOME (Home Ownership Means Equity) to tackle the challenges many Latinos face in buying homes, UnidosUS and Wells Fargo will announce.
- The program will push new lending rules, and increased housing density through zoning reforms.
Student Housing Financing Deals
In late February, the Supreme Court heard arguments related to a lawsuit trying to block President Biden’s debt relief program. Updates related to this that occurred in the past week suggest that the Supreme Court may rule against the program.
However, some fintech startups have not only stepped up to provide some relief options, but also give employers a way to help relieve some of the burden, while also providing a recruitment and retention tool.
Banks and retail are the business sectors first in line for the biggest boost from generative AI, Axios global tech correspondent Ryan Heath writes from a McKinsey report out last week.
- 75% of productivity gains from generative AI will come from just four business functions: customer operations, marketing and sales, software engineering and R&D, the report says.
Why it matters: The higher the pay and education associated with a work function, the more susceptible it will be to AI's impact, according to McKinsey.
The findings: McKinsey — which studied 63 practical uses of generative AI across 2,100 existing work activities — expects activities that consume about two-thirds of our work time today to be automated over the next 20 years.
- A key example is R&D, where the emerging field of generative design — turbocharged by foundation models that enable faster drafting and testing of products and services — will provide big efficiencies.
🧮 By the numbers: Generative AI could add up to $4.4 trillion a year to the global economy — a sum greater than the GDP of Germany.
Robinhood said last week it is acquiring credit-card startup X1. X1 offers a no-fee credit card with rewards, as well as the ability to create virtual, single-use cards. Robinhood said it expects to pay around $95 million in cash for X1 and close the acquisition in the third quarter of this year.
Offering customers a credit card would continue Robinhood’s effort to expand its product line beyond stock, options and crypto trading. Robinhood CEO Vlad Tenev has said adding new products and operating in more countries would help the company boost its revenue. Last year, Robinhood introduced a debit card and IRA accounts.
Robinhood’s prior acquisitions include the investor communication company Say Technologies and the crypto trading firm Cove Markets. Earlier this year, Robinhood abandoned a deal to buy UK-based crypto trading firm Ziglu.
Zurich Insurance Group(SWX: ZURN) is in talks to buy up to a 51% stake in India's Kotak General Insurance at around an $800m valuation, per Reuters. More here ->
Flexpoint Ford agreed to buy Baker Hill, a Carmel Hill, Ind.-based provider of loan origination and risk management software, from The Riverside Company. More here ->
Summit Partners invested in TradingHub, a London-based financial markets analytics platform. More here ->
Finfra, an Indonesian provider of embedded finance infrastructure, raised $1m. It provides a loan management system so businesses can offer credit to clients through their platforms. More here ->
Majority, a Miami-based mobile banking service for migrants, raised $9.75m in Series B extension funding from insiders Valar Ventures and Heartcore Capital. The company also announced that is has opened a community meetup space in Laredo, Texas. More here ->
Paro, a Chicago-based marketplace for freelance finance and accounting professionals, raised $25m in Series C funding. Top Tier Capital Partners led, and was joined by insiders Madrona Venture Group, Revolution Ventures and Sierra Ventures. Paro’s platform uses algorithms to identify and recommend financial talent — e.g. accountants — to businesses. Customers can connect on-demand to accounting and finance experts, paying them only for the work that’s needed. More here ->
Truework, an SF-based income verification platform, raised $24m from TransUnion. Founded in 2017, San Francisco-based Truework integrates with third-party services, such as payroll providers, to help mortgage providers and similar lenders verify users and approve loans directly from within their own applications. It can also be used by landlords or would-be employers to carry out background checks. More here ->
Aktos, a New York-based debt collection SaaS startup, raised $4.4m in seed funding. Aktos’ cloud-native software is designed to help third-party debt collection agencies manage their operations. More here ->
Chexy, a Toronto-based rewards platform for on-time rent payments, raised US$1.3m in pre-seed funding. More here ->
Indifi, an Indian digital lender to SMBs, raised $35m in Series E funding. The startup’s online marketplace enables businesses in various sectors – from travel to e-commerce, hotels, and retail – to conveniently secure unsecured loans tailored to their unique needs. More here ->
Nocnoc, a cross-border payments startup focused on Latin America, raised $14m in Series A funding. Online merchants upload their product catalog to nocnoc’s platform and then can start selling on marketplaces, including Amazon, Mercado Libre, Americanas, Carrefour, Walmart, Magazine Luiza and Coppel. More here ->
Atoa Payments, a British open banking startup, raised $6.5m in seed funding. The startup is bidding to bypass the card giants, inviting businesses to download the Atoa app and connect their merchant bank accounts. After a five minute set up, merchants can accept payments via SMS, Pay-by Link or QR code. More here ->
Apron, a British consumer payments startup, raised $5.5m. More here ->
Volt, a British open banking startup, raised $60m in Series B funding. The company currently integrates with some 5,000 banks in the regions where it’s active — currently the U.K., Europe and Brazil — and then signs up customers — online retailers and others doing transactions online — to use its rails to be able to take and make payments and run other services for customers of those banks, as another option to pay for goods or services alongside, say, making a card payment or using a mobile wallet service. More here ->
TransBnk, an Indian cross-border payments startup, raised $1m in seed funding led by 8i Ventures. More here ->
BoomFi, a London-based crypto payments startup, raised $3.8m in seed funding. More here ->
Freetrade, a British stock trading app backed by L Catterton and Left Lane Capital, is launching a crowdfunding campaign that would value it at £225m (65% discount to last VC round). The company offers a freemium share dealing service. The company was founded in 2016 and launched an iOS app in October 2018. More here ->
OneVest, a Canadian wealth management startup, raised C$17m in Series A funding. The company enables any entity to launch a net-new wealth program or modernize the delivery of their existing one. More here ->
Thinksurance, a German insurtech focused on commercial and industrial clients, raised €22m. It strives to connect insurers and distributors on a single platform to make "commercial insurance the epitome of what it is supposed to be – simple, fast, and digital." More here ->
Accelerant, an Atlanta-based insurance risk exchange, raised $150m led by Barings at a $2.4b valuation. It aims to "empower underwriters with risk exchange, data analytics, and long-term capacity commitments." More here ->
From the Stash
Discover launches $36M venture fund - Discover has pledged $36 million toward its Discover Financial Health Fund, an initiative launched last week to support startups that promote the financial well-being of traditionally underserved populations. “The solutions being developed will support and improve the financial health of low- and moderate-income people, communities, and small businesses." More here ->
The Fintech Funding Crunch In 4 Charts - Few sectors illustrate the massive runup in venture funding that occurred in 2021 as well as financial services and the fintech industry. More here ->
P&C Market Predicted to Grow by US$676.06 Million -
The Property and casualty insurance market is projected to witness significant growth, increasing by $676.06 million from 2022 to 2027. More here ->
Insuring the uninsurable: How Breach is Transforming Investment Risk in the Crypto Market - Eyhab Aeyjaz, the CEO and Co-Founder of Breach Insurance, is leading the charge when it comes to securing investments in the digital asset space through his scaling insurtech start-up, Breach. Here, he speaks to Insurtech Insights about the challenges and opportunities for crypto insurance. More here ->
Lemonade Sets New Record by Settling Claim in Two Seconds - Lemonade, the InsurTech firm known for its use of AI and machine learning, has achieved a remarkable feat by settling an insurance claim in just two seconds, setting a new world record in the process. More here ->
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