December fintech VC roundup: VCs continue their love affair with payments

It’s safe to say that last year was a landmark year for fintech startups seeking VC dosh. By the end of the year, $124.7 billion was raised over more than 4,000 rounds, according to Dealroom. 

Whilst for many December is a month of rest, fintech didn’t take a break. In December, fintech startups raised $11.5 billion — the same amount raised in November. 

Excluding Better.com’s pre-SPAC financing, the big raise rounding off last month was NYDIG’s $1billion round led by Westcap. In second place, Monzo’s monster $500 million round led by Abu Dhabi Growth Fund also raised eyebrows. Previously, in its annual results, Monzo’s accountants had cited concern about its ability to continue as a company. 

Although lending and banking won some of the biggest rounds, it was payments once again that triumphed over other sub-sectors with $2.2 billion going to payments firms. 

For those looking to dive a little deeper into what fintech VCs were up to in the festive season, below is a roundup of the five biggest raises across five categories of wealthtech, banking, lending, payments and financial management. 

The return of the great British neobank

Challenger bank heavyweights from the UK to the US and India raised in December. 

• UK challenger bank Monzo raised a $500 million round led by the Abu Dhabi Growth Fund. Previous investors such as Goodwater and Accel also participated in the round. It’s valued at $4.5 billion, a conservative figure compared to its neobank contemporaries N26 and Revolut, which are valued at $9 billion and $33 billion respectively. 
• Cloud banking platform Mambu closed a $266 million Series E round led by EQT Growth valuing the company at a cool $5.5 billion. The company says it was the largest round to date for a banking software company. 
• Green banking service Aspiration raised a $315 million round led by Oaktree Capital Management. Previously backed by actors Robert Downey Jr and Leonardo DiCaprio, the company provides savings, debit, and credit card services which it says will never be used to fund the oil or coal industries. 
• The UK’s The Bank of London raised $90 million in an investment led by ForgeLight. The fintech is a new clearing bank founded by former Barclay exec Harvey Schwartz offering BaaS services, savings accounts, and payments services. 
• Indian challenger bank Jupiter raised $86 million in a Series C round led by Tiger Global, GED, and Sequoia Capital, valuing the company at $711 million. It plans to use the extra dosh to offer lending and wealth management services to its customers. 

Wealthtech rewards those who VC 

In wealthtech, startups catered towards institutional investors garnered the most attention from VCs last month. 

• YipitData, a research firm specializing in data for institutional investors on new economies such as ridesharing and e-commerce, raised $475 million in Series E funding led by investment firm Carlyle. 
• iCapital Network, a NYC-based alternative asset investment platform, closed a $50 million round led by Westcap. 
• Clarity AI, a wealthtech tool that helps investors to understand their environmental and social impact, raised $50 million led by SoftBank Vision Fund 2. BlackRock and Fifth Wall Ventures also participated in the round. 
• Purefacts Financial Solutions, a SaaS and consulting company for the wealth management industry, closed a $37 million financing round from the Canadian Business Growth Fund, The Bank of Novia Scotia and Round13 Capital. 
• StockTwits, a social media platform for investors, raised a $30 million Series B led by Alameda Research Ventures. The company plans to use the cash to expand their product offerings, including further development of its portfolio integration feature.

All press is good press? 

Controversy among lending startups has not prevented them from raising huge rounds in December, notably in the LatAm region. 

• TechCrunch reported that scandal-ridden Better Mortgage has received half of the $1.5 billion committed by Aurora Acquisition Corp and SoftBank in advance of its now-delayed SPAC listing. The company landed in hot water last year after firing hundreds of employees via Zoom. 
• Indian SME credit financing startup OfBusiness raised $325 million in Series G financing. The round was led by Tiger Global, SoftBank and Alpha Wave Ventures, which valued the company at $5 billion. 
• SoftBank also led another round in Brazilian consumer credit fintech Open Co for $115 million. It plans to use the financing to tackle the country’s credit problem — average credit rates charged by financial institutions near 300% per year reportedly. 
• Also in the LatAm region, Mexican consumer lender and BNPL firm Kueski raised a $102 million Series C equity round led by StepStone Group (Victory Park Capital also led a $100 million debt round). The company plans to use the financing to continue the development of BNPL in the country along with expanding their personal loan and interest-free salary advance products. 
• Colombian lender and BNPL provider Addi raised an $80 million Series C courtesy of SoftBank and Andreessen Horowitz.

Super-apps for the win

December was clearly payments super-app season in the fintech world. Vietnamese and French payments apps tapped huge rounds. 

• Indian payments outfit Razorpay doubled its valuation in December thanks to a $375 million Series F round co-led by TCV, Lone Pine Capital, and Alkeon Capital. It plans to use the money to further scale its neobanking operations and also pursue acquisitions. 
• Vietnam’s super-app Momo raised a $200 million Series E round led by Japanese bank Mizuho, valuing the company at $2 billion. Beginning as a sim card application allowing p2p transfers, it has since expanded to a smartphone wallet along with an investment marketplace and insurance payments. 
• In France, payments player and wannabe super-app Lydia raised $100 million in a Series C round, valuing the company at $1 billion. It plans to use the funding to expand into other European markets and ramp up hiring. 
• Onecard, an Indian mobile-first credit card startup, raised $75 million in a round led by QED investors. It’s now valued at over $700 million. 
• Joining the credit card game in India, Uni Cards raised a $70 million Series A from investors including Eight Road Ventures and Accel. 

Well-managed apps

December saw accounting APIs for the e-commerce sector and supply chain financing startups net big funding hauls from VCs. 

• Tipalti, the B2B cloud platform that automates the accounts payable process for mid-size, high-growth companies, raised a $270 million Series F as it expands to the EU and the UK. New investors such as Marshall Wace and Morgan Stanley participated in the round as it prepares to go public in the near future. 
• A fintech funding roundup wouldn’t be complete without at least one expenses fintech. Danish financial management outfit Pleo raised $200 million to fund its ambitions to enter 15 European markets this year. 
• Tradeshift, a supply chain financing startup based in San Francisco, raised $200 million in equity and debt financing from investors such as Koch Industries. 
• Mexican corporate spending management fintech Clara raised $70 million in Series B funding along with announcing a launch in Brazil. In 2022, the company is looking to expand its scope, with a Colombia launch in the pipeline. 
• Taxdoo, an accounting fintech company that builds APIs to help e-commerce companies with tax compliance, announced a $64 million Series B led by Tiger Global. The company is reportedly just shy of a $350 million valuation.