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2016 view of FinTech Landscape Summary view of 100+ startups

(May 2016)

Uday Singh, Yatin Chhabra, and Ben DiPietro

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Preface

The focus of this article is more on the startup activity in the FinTech space and the distinct

capabilities that are being built and less on trying to define the FinTech space itself. There is quite a

bit of good literature on the Internet describing the scope and bounds of FinTech and the reference

section at the end of this article lists most of the interesting and informative pieces. The first section of

the article provides a summary view of evolution of this space over the past few years, capabilities

being built, and investments in each of those capabilities, the second section provides a summary

view across startups along with high-level insights/ patterns that can be observed, and the final

section provides a compendium of close to 100 startups along with key information (investment,

revenue, company size, etc.,). We recognize that even before it is finalized, the article is likely to

become outdated as there is significant startup activity in this space. Despite such a short shelf life,

we chose to structure the article in such a way that it will lend itself for relatively easy refresh as new

data become available

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FinTech timeline, capabilities, and venture investments

For any emerging industry with little or no market data, the best place to start sizing up the potential

market is to look at the investments flowing into that space. Based on that measure, FinTech is

growing and doing extremely well as it has been attracting a lot of investor attention with yearly

investments increasing at about 60% annually over the past 5-6 years. The latest investment statistics

(triangulating from multiple sources) indicate that a total of US$19.1 billion in investments have found

their way into the FinTech space in 2015 of which US$13.8 billion is invested in Venture Capital (VC)

backed companies. In 2015, VC investments in FinTech have jumped by 106% compared to 2014,

which was considered a record year for VC-backed investments. In the first month of 2016, total of

112 deals have been struck in FinTech adding up to US$7 billion in investment financing.

At the time of writing of this article, there are hundreds of FinTech startups spread across the world

with significant concentration in US, China, UK, Australia, and India.

Although there are potentially different categories into which these FinTech investments can be

categorized, the below split should work for basic understanding of this emerging space and has been

used for the purposes of structuring this paper, which is primarily aimed at cataloging the various

notable startups in this space along with the problem space that they are trying to address

Payments

Loans

Data and Analytics

Trading Platforms

Personal Finance and Investing

Insurance

Payments

Global payments industry has seen significant innovation and disruption as part of the FinTech

revolution. Investment in this space is approximately 50% of the total investment in the FinTech

space. As new payment capabilities come to the fore, cutting-edge technology is transforming how

transactions are initiated and processed. This is no longer just a case of new currencies or faster

payment methods, but an entire rethinking of transfers of “value” and how these are undertaken.

Focus of innovation is on three key fronts

− Payment processing: Quite a few interesting business models in this space including online end-

to-end payment processing systems, integrated systems that provide mobile credit card readers

to retailers, and a startup that takes the risk of payment defaults by paying the sellers right away

and delivering goods to the buyers, and subsequently collecting the payments from buyers. Other

newer models include payments and exchanges for bitcoin

Funding Raised by FinTech Firms (In Billion $)

2 4 4

8

13.8

19.1

2010 2011 2012 2013 2014 2015

57%

CAGR

Source: World Economic Forum Report FinTech report

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− Money transfer: Some of the business models in this space include instant money transfer via

cellphone or email with the services linked to user’s bank account, mobile payments and wallets

that allow small businesses to send out offers to customers and collect loyalty points, Bitcoin

wallets providing international money transfer services to expats, foreign students and businesses

sending and receiving money abroad using only real time exchange rates and very small fees

− Cryptocurrencies (predominantly Bitcoin and Distributed Ledger): Offerings in this space include

Blockchain powered SaaS service for banks that delivers instant settlement and delivery versus

payment for financial trades, an international payment platform enabling online and retail

merchants a way to accept bitcoin, Litecoin and Dogecoin as payment methods, and Blockchain

technology SDKs and APIs for developers and enterprises to build customized blockchain

applications

Major startups in the Payments space: Alipay, Venmo, Square, Bitcoin, Ripple

Loans

Loans is the second largest segment with 40% of the total FinTech investment going to the startups in

this space. A global phenomenon for small businesses, FinTech has rapidly emerging new players

across developed and growth markets. No one nation seems to have a monopoly on idea generation,

with some innovative business models starting in emerging markets first and spreading to the rest of

the world in subsequent years. FinTech firms have unleashed a new set of products tailored to the

needs of small businesses including

− Peer-to-peer (P2P) loans: Service models in this space include peer-to-peer online lending

platforms enabling borrowers to obtain a loan and investors to purchase notes backed by

payments made on the loans, lending platforms leveraging big data and machine-learning

algorithms to offer highly customized lending rates and options, credit rating services that

compute the risk of borrowers based on a range of personal data including information gleaned

from social-media profiles, and peer-to-peer lending services that allow savers to lend money

directly to small and medium sized businesses instead of individuals

− Trade finance: Innovative models in this space include multinational lender for small and medium

businesses that provides small business loans from $1,000 to $250,000 for small business

owners, platforms that allow businesses of any size to offer consumer financing to their customers

via any device, services that bring sales financing to SME (sales financing is a strategy

traditionally used by the auto industry and big-box retailers), multi-continental/ cross-border

lending marketplace to lend in countries with limited consumer credit information using proprietary

credit rating systems, and unique platform allowing SMBs to raise funds from their customer base

in return for a discount on goods/services purchased during the term of the loan and the

remainder of the amount lent is repaid in cash at the end of the term

− Supply chain finance: Supplier financing platforms and marketplaces, providing solutions for

dynamic and customized discounting, supplier info management, eInvoicing, and ePayments.

These platforms allow SMEs to determine the appropriate level of access to information for the

lenders so that the lenders can make credit decisions based on purchase orders, invoice status

and approvals, and payment remittance details

Major startups in the Loans space: SoFi, Lending Club, Prosper, Lufax (China)

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Data and Analytics

This is a broad category/ segment focused on innovation across different aspects of the financial

industry including

− Integrated Banking IT platform: Comprehensive, fully-integrated bank operating system (end to

end solution combining CRM, loan origination, workflow, enterprise content management, and

instant reporting capabilities) to drive increased profitability, productivity gains, regulatory

compliance, and operating transparency at all levels of the Bank

− Know Your Customer (KYC), Anti-Money Laundering (AML), and Fraud detection: Software for

financial institutions to comply with KYC regulations while facilitating customer on-boarding, due

diligence, and compliance. Technologies to recognize electronic identities based on every

attribute associated with a transaction, big data, machine learning, and human intelligence for

AML and fraud detection

− Security and authentication systems: Advance authentication systems to provide improved

security and access to individual bank accounts. An example is a behavioral authentication

system based on continuous authentication via sophisticated behavioral analytics for use with

mobile apps and websites, making it more difficult for hackers to breach online accounts

− Credit Ratings: Big data for improved credit ratings/ scores. Historically credit scores were

provided based on basic financial transaction and served as the norm for all credit activities in the

financial services space. The big data goes beyond the available quantitative data from banks

and includes qualitative concepts like – behavior, willingness, ability, etc. The growth in segments

such as P2P lending, small business financing is a result of these innovative scoring models

− Enhanced market data, news, and research services: Some of the examples of startups in this

space include a) analytical tools for capital markets such as a research and analytics platform that

offers quantitative analyses for financial professionals, statistical computing software and financial

risk analysis applications, b) financial estimates platforms aggregating fundamental estimates

from independent, buy-side, and sell-side analysts, along with those of private investors and

students, and c) data science platforms offering applications and services for the financial industry

to more intelligently aggregate and analyze financial account data

Major Startups in the Data and Analytics space: Wealthfront, EidoSearch, SigFig, Credit Karma

51% 41%

2% 2%

2% 1% 1%

Payments

Loans

Data and Analytics

Trading Platforms

Personal Finance

Insurance Tech

Other

Funds Raised by FinTech Companies Globally (By Segment)

Source: World Economic Forum Report, Information Venture Partners, INSEAD

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Trading Platforms

Primary driver for innovation in this space is the distributed ledger technology that is an enabler for

efficiency and productivity improvements in trade settlements, collateral management, custody, and

bilateral trade without central exchanges or clearing houses

Major Startups in the Trading Platforms space: ItBit, MetaMako, Cinnober

Personal Finance and Investing

Innovations and startups in this space are focused on:

− Early stage & pre-IPO investments: Platforms that provide retail investors access to high growth

and/ or pre-IPO companies while allowing the companies’ employees and other shareholders to

cash in on their shares without needing to wait for the company to be acquired or go through an

IPO. Other startups in this space are built for accredited investors to provide venture capital

funding for early-stage startups, allowing startups to raise money from angel investors

− Personal finance tools: Access to online credit reports, personal finance software that focuses on

behavior change and takes you from cutting expenses to budgeting for goals to investing your

money. Other startups allow users to track bank, credit card, investment, and loan balances and

transactions through a single user interface, as well as create budgets and set financial goals. A

mobile and website application scans credit card and debit card transactions, alerting users to

possible scams, billing errors, fraudulent charges and hidden fees. Another startup provides a

pre-paid card with unique parental controls for young people between the ages of 8 to 18 years

− Robo-Advisors: These are automated investment services that retail investors access to

automated trading strategies and investment ideas. These technology-backed advisors were built

on the premise that many of the activities performed by a Registered Investment Advisor (RIA)

can be replicated by advanced intuitive software. They promise lower costs, simplicity and even

the bonus potential of making investing fun

− Fair access to exchanges/ pools: Examples in this space include a startup providing transparent

and straightforward access to dark pool levelling the playing field for all traders, and another

startup providing municipal bond investing platform that allows users to search and filter for bond

issuances by community, cause or yield online bringing the trusted municipal finance market into

the digital realm

Major Start-ups in the Personal Finance and Investing space: AngelList, OurCrowd, IEX

Insurance

Innovation in the insurance space has largely been driven by the availability of data-driven insights.

Not only are insurers becoming better at interpreting data, but the availability of data is rapidly

increasing, in particular, due to the Internet of Things (IoT). The lines between digital and physical

worlds are being progressively blurred. Smart devices, from wearables to home sensors and vehicle

telematics, are expanding our insight into and control over the physical world, promising to transform

the insurance industry forever. The data which these connected devices gather is allowing insurers to

refine risk and redefine their products, revolutionizing customized insurance offerings. Rather than

charging a premium based on aggregate demographic considerations, data-driven insights will, for the

first time, allow insurers to offer their customers custom and bespoke products

Major Start-ups in the Insurance space: Oscar, Collective Health, ZhongAn

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FinTech investments across the globe

Not totally unexpected, most of the investments were directed at FinTech startups based in US, with

54% of 2015 investment going to US companies, followed by Europe (UK, Netherlands, Sweden) with

23%, and China in the third place with 8%

It is our belief that the geographic distribution of investment is likely to change in the future with the

share of investment increasingly going into Chinese FinTech companies. It is not surprising that

based on investment data as of Jan 2016, 92% of the funding raised thus far has gone to Chinese

companies with more than half of the funds going to two Chinese companies – Meltuan-Diaping (the

largest discount deals and financing site in China) and Lufax (the largest P2P lending based in China)

FinTech evolution timeline

FinTech 1.0

FinTech 1.0 has brought only minor disruptions to the banking market, mainly in the areas of

payments, credit and personal financial. But changes in customer preferences, advances in

technology (e.g., distributed ledger) and growing investment in FinTech have set the scene for more

radical change

FinTech 2.0

FinTech 2.0 is already delivering fundamental changes to the infrastructure and processes at the core

of the financial services industry. Some of the important innovations will relate to IoT (Internet of

Things), transformation of Trade Finance and adoption of Distributed Ledger Technology

− Real-time Access to Information: IoT technology will provide banks and insurance companies with

real-time access to data, eliminating the need for manual checks and paper documentation such

as bills of lading. The IoT gives sellers and their banks access to real-time information they need

regarding goods in transit which would significantly reduce cost of the overall process

− Low Cost of Trade Finance: Access to real-time trade details enables digitized smart contracts to

be verified instantaneously, assuming pre-defined conditions are met. This would allow a letter of

credit to be issued more efficiently than in today’s trade finance process. Eliminating manual

checks improves speed as well as efficiency of the process

− Improving Valuation Accuracy of Real Assets: Inefficiencies in the global collateral management

market are estimated to cost banks up to $4 billion annually. Adopting IoT technology could

Funds Raised by FinTech Companies (2015) Number of FinTech companies (2015)

Source: World Economic Forum Report, Information Venture Partners, INSEAD

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significantly reduce this figure as real-time monitoring technology will improve valuation accuracy

and render more assets eligible for collateral financing

− Embedding distributed ledger technology: In contrast to today’s transaction networks, distributed

ledgers eliminate the need for central authorities to certify ownership and clear transactions.

Distributed ledgers can be open, verifying anonymous actors in the network, or they can be

closed and require actors in the network to be already identified. Commercial banks, central

banks, stock exchanges and major technology providers, such as IBM and Samsung, are all

exploring the potential uses of distributed ledgers. This will be an interesting and evolving space

over the next 5 to 10 years and certainly a space to watch closely

Compendium of 100+ FinTech startups

For the purposes of this article we looked at over 100 companies, the majority of which are less than

10 years old across the globe

− USA: Approximately half (50%) of the companies are based in the USA generating over $5.6bn in

annual revenue

− Europe: 25% of the companies are based in the Europe generating over $1.1bn in annual

revenue

− China: 8% of the companies are based in the China generating over $9.6bn in annual revenue

− Others (Australia, Sweden, India, etc.,): The rest of the world has 17% of the companies

generating over $0.5bn in annual revenue

In terms of customers serviced by the companies (businesses vs individuals), slightly more than half

(54%) of the companies serve businesses (B2B) while the remainder (46%) serve individuals (B2C).

At this point, there seems to be no clear advantage between B2B or B2C FinTech companies from the

perspective of revenue generated, capital raised, or market valuation

With significant amount of investment flooding into this space (~$19 billion in 2015), there is always

the pregnant question whether a bubble is brewing in this space. There is certainly value being

created with several hardware and software innovations by the various startups, but the rising tide of

investment could also be lifting other players that may not have viable business models. At this point it

is too early to determine which ones will survive in the long run. Of the companies reviewed in this

paper, fewer than 10% had revenue higher than their respective total funding thus far - this situation

should improve as the products/ services are more widely adopted

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Another lens is to look at the profile of investors funding companies in this space - from that

perspective, there have been quite a few high profile players including financial institutions,

government agencies, private equity and venture capital firms that have invested significantly into

various companies across all the major categories within FinTech. Some of the notable investors

include:

− Goldman Sachs (Oscar, Kensho, Square, Motif Investing)

− Sequoia Capital (Stripe, Klarna, Square, Prosper, Rong360)

− Morgan Stanley (ZhongAn, SoFi)

− Citi (Square, C2FO)

− Santander (Meniga)

− Credit Suisse (Prosper)

− Fidelity (Oscar)

− BlackRock (Funding Circle)

Based on the 100+ reasonably sized companies in the FinTech space, it appears that the level of

disruption is not highly correlated with the revenue generated by the company, at least at this point in

time. Perhaps over the next 3 or 5 years as some of the disruptive technologies (e.g., peer-to-peer

lending, international lending, and distributed-ledger based solutions) mature and gain wider adoption

the map below might show greater revenue generation by companies that are working on

technologies or business models with higher level of disruption

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Payments

This was the segment with the highest economic activity among FinTech companies researched and

close to 25% of the number of businesses operates in this segment. There are 3 main subcategories

within this segment – payment processing, money transfer, and cryptocurrencies – with payment

processing services being the highest revenue generator of all of the subcategories across all of the

FinTech segments. The companies comprising the payments category also are relatively older than

those in the other categories

Company Description/ Service Financials

(USD Millions)

Payment processing

Alipay

(2004)

A third-party online payment platform with no transaction fees – they hold a

buyers payment in escrow until the buyer has received and is satisfied with

their purchase

Capital Raised: 3,500

Revenue: 8,000

Market Value: 60,000

Square

(2009)

Smartphone debit and credit card readers (in addition to other payment

processing and point-of-sale offerings)

Capital Raised: 600

Revenue: 900

Market Value: 5,200

One97

(2000)

Delivers mobile content and commerce services through its flagship brand:

Paytm, the largest Indian digital goods marketplace and a leading payment

solutions provider to ecommerce merchants

Capital Raised: 585

Revenue: 90

Market Value: 2,000

Adyen

(2006)

A global multichannel payment company offering businesses an outsourced

payment solution for mid, large and enterprise e-commerce merchants,

which enables merchants to accept payments from anywhere in the world

Capital Raised: 500

Revenue: 350

Market Value: 2,300

Stripe

(2011)

Provides payment technologies, logistics, and services to companies doing

business over the internet (including bitcoin transactions)

Capital Raised: 300

Revenue: 40

Market Value: 5,000

Klarna

(2005)

User friendly payment systems and services for online storefronts (their

main service differentiator is to assume stores' claims for payments and

handle customer payments, thus eliminating the risk for seller and buyer –

billing customers later and paying the retailer in the meantime)

Capital Raised: 282

Revenue: 250

Market Value: 2,250

Zuora

(2007)

An enterprise software company that designs and sells SaaS applications to

automate billing, commerce, and finance operations for companies with a

subscription business model

Capital Raised: 240

Revenue: 100

Market Value: 1,500

Credorax

(2007)

Provides an entirely new breed of acquiring - Smart Acquiring, to partners

and online merchants. Credorax’s acquiring solutions are based on its next-

generation payment processing platform. Credorax combines customizable

pioneering technology with a service oriented approach for business results

Capital Raised: 80

Revenue: 5

Market Value:

The Currency

Cloud

(2009)

Automated platform for companies who need to provide an international

payment system for their customers (charging a flat 0.25% fee)

Capital Raised: 36

Revenue: 40

Market Value:

GoCardless

(2011)

Provides a simple and cost-effective way to accept recurring payments.

GoCardless has automated and abstracted away the complexities of Direct

Debit to expose an interface so simple anyone can use it, yet powerful

enough to serve the UK’s largest institutions

Capital Raised: 25

Revenue: 2

Market Value:

iZettle

(2010)

Makes card readers for smartphones to let independent traders and small

businesses accept payments

Capital Raised: 250

Revenue: 5

Market Value: 1,400

WePay

(2008)

Online payment service provider focusing on platform businesses such as

crowdfunding sites, marketplaces and small businesses

Capital Raised: 70

Revenue: 75

Market Value: 220

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Money Transfer

Mozido

(2008)

Mobile payment and wallet provider (allows small businesses to send out

offers to customers and collect loyalty points)

Capital Raised: 310

Revenue:

Market Value: 1,000

Venmo

(2009)

Links user’s bank account and allows them to send money to contacts free

and instantly

Capital Raised: 800

Revenue:

Market Value:

TransferWise

(2010)

Allows expats, foreign students and businesses to move and send money

abroad at the lowest possible cost, using only real exchange rates and small

fees

Capital Raised: 90

Revenue: 17

Market Value: 1,000

Fastacash

(2012)

Provides a global social payments platform which allows users to transfer

value (money, airtime, other tokens of value, etc.) along with digital content

(photos, videos, audio, messages, etc.) through social networks and

messaging platforms

Capital Raised: 25

Revenue: 25

Market Value: 140

Revolut

(2014)

An app that cuts hidden banking fees to zero; it also allows you to exchange

money at perfect interbank rates, send money through social networks, and

use a multi-currency card everywhere MasterCard® is accepted

Capital Raised: 8

Revenue: 1

Market Value:

Cryptocurrencies and Distributed Ledger Technology

Bitpay

(2011)

Global bitcoin payment service provider that provides processing services for

merchants and is one of the largest bitcoin payment processors as well as

other open source bitcoin projects

Capital Raised: 30

Revenue: 5

Market Value: 160

Ripple

(2012)

A virtual money transferring platform that enables institutions to transfer

money internationally using bitcoin-like technology

Capital Raised: 30

Revenue:

Market Value: 500

Elliptic

(2013)

A blockchain security and compliance company capitalizing on the potential

of the blockchain technology and to help transfer the rigorous security and

compliance standards of traditional finance to the world of digital currencies

Capital Raised: 7

Revenue: 1

Market Value:

Colu

(2014)

A blockchain platform for building blockchain-based applications (i.e., a

mobile app that enables users to store, send and receive digital, a Dashboard

which is a control panel for managing digital assets, an Engine that handles

all things blockchain in the backend using our API and SDK)

Capital Raised: 3

Revenue: 1

Market Value:

GoCoin

(2013)

An international payment platform providing online and retail merchants a

way to accept bitcoin, Litecoin and Dogecoin as payment methods

Capital Raised: 2

Revenue: 1

Market Value: 10

Coinify

(2014)

Drives mainstream adoption of digital currencies, such as Bitcoin, for

merchants and consumers. Merchants benefit from the payment service,

enabling free, instant settlements in a fraud-free and chargeback-free

blockchain payment environment, giving consumers access to secure, one-

click payments that reveal no sensitive information

Capital Raised:

Revenue:

Market Value:

Epiphyte

(2013)

Blockchain powered SaaS service for banks that delivers instant settlement

and delivery versus payment for financial trades

Capital Raised:

Revenue:

Market Value:

21Inc

(2013)

The first computer for the Bitcoin protocol with native hardware (to mine a

stream of small amounts of bitcoin for development purposes) and software

support (to make that bitcoin useful for buying and selling digital goods).

Used to quickly create apps, services, and devices that can be rented or

bought for bitcoin. The chip is specifically designed to mine in the background

to provide a small stream of bitcoin to your computer as a system resource

Capital Raised: 120

Revenue: 40

Market Value:

Coinbase

(2012)

Bitcoin wallet and exchange company

Capital Raised: 100

Revenue: 4

Market Value:

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Loans

This segment has the second highest concentration of FinTech companies with roughly 20% of the

businesses operating in the Loans segment. Peer-to-peer lending services are the largest source of

economic activity in this segment

Company Description/ Service Financials (USD

Millions)

Peer-to-Peer lending

Lufax

(2011)

An online Internet finance marketplace in China that matches borrowers

with investors

Capital Raised: 1,000

Revenue: 100

Market Value: 18,500

OnDeck

(2006)

Faster, more specific alternative to banks for financing loans for small

businesses based on proprietary method evaluating businesses

creditworthiness based on "actual performance, not personal credit"

Capital Raised: 180

Revenue: 254

Market Value: 550

Financeit

(2011)

A platform that allows businesses of any size to offer consumer financing to

their customers with any device. Sales financing is a strategy traditionally

used by the auto industry and big-box retailers that they are bringing to

SMEs in the USA and Canada

Capital Raised: 22

Revenue: 10

Market Value:

Credithood

(2014)

A platform where SMBs raise funds from its repeat customer base in return

for discounts on goods/ services during the term of the loan (amount not

used for goods or services during the by the end of the term is repaid). The

entire transaction is based on the reputation of the SMB as perceived by its

customers (no paper work, no credit score, no external evaluation)

Capital Raised:

Revenue: 1

Market Value: 10

SoFi

(2011)

Fully digitized platform offering fast application processing for student loan

refinancing, mortgages, and other types of personal loans

Capital Raised: 1,770

Revenue: 250

Market Value: 4,000

LendingClub

(2006)

The largest peer-to-peer online lending platform enabling borrowers to

obtain a loan and investors to purchase notes backed by payments made

on the loans

Capital Raised: 1,000

Revenue: 400

Market Value: 3,100

Qufenqi

(2014)

Offers monthly installment payment solutions to the students and

professionals in China (primarily offers smart phones, laptops and other

consumer electronics online, allowing customers to choose their own down

payment option and the time period for making regular monthly installments)

Capital Raised: 400

Revenue: 1,100

Market Value: 1,300

Prosper

(2005)

A peer-to-peer lending service where individuals can either invest in

personal loans or request to borrow money

Capital Raised: 350

Revenue: 80

Market Value: 1,900

Funding

Circle

(2010)

A peer-to-peer lending service which allows savers to lend money directly to

small and medium sized businesses

Capital Raised: 273

Revenue: 55

Market Value: 1,000

CommonBond

(2011)

Peer-to-peer student loan financing marketplace

Capital Raised: 250

Revenue: 100

Market Value: 2,000

SocietyOne

(2011)

Offers highly competitive personal loan interest rates and commensurate

returns for investors in this asset class. The platform reduces the cost of

originating and managing consumer loans, sharing its operating cost

advantage with both borrowers and investors to get a better deal

Capital Raised: 160

Revenue: 5

Market Value:

Jimubox

(2013)

Online peer-to-peer loans for small businesses and consumers

Capital Raised: 130

Revenue: 1

Market Value: 1,000

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Zopa

(2004)

Peer-to-peer lending that works by bringing together individuals who have

money to lend, and individuals who wish to borrow money. Instead of going

through traditional banks, borrowers looking for low rate loans are matched

with lenders looking for better returns on their money

Capital Raised: 50

Revenue: 20

Market Value: 500

Trade finance

Ebury

(2009)

Provides customers with greater and faster access to finance, while helping

them to manage currency risk and strategically plan their approach to

overseas payments.

Capital Raised: 115

Revenue: 5

Market Value:

Kabbage

(2008)

A financial services data and technology platform that provides fully

automated funding (working capital) to small business in minutes

Capital Raised: 110

Revenue: 40

Market Value:

C2FO

(2008)

The world’s market for working capital and risk-free profit, is the only working

capital exchange that allows companies to optimize their working capital

positions in a live, bid/ask environment

Capital Raised: 70

Revenue: 13

Market Value:

Spotcap

(2014)

An innovative multinational online lender for small and medium businesses

that provides loans from $1,000 to $250,000 for small business owners,

enabling small business owners who have been operating for more than one

year to grow their business by providing fast and flexible financing

Capital Raised: 50

Revenue:

Market Value:

Moula

(2013)

Provides small business loans of up to $100,000 with no hidden fees and no

hassle using a unique platform that will analyze business data, providing

funding that is relevant and appropriate to help you grow. Moula is Australia’s

only dedicated provider of working capital to small and medium businesses

Capital Raised: 31

Revenue:

Market Value:

Prospa

(2012)

A fast and flexible solution to working capital needs, allowing customers to

concentrate more on the job of building a business and less on capital

Capital Raised: 100

Revenue:

Market Value:

Supply chain Finance

Taulia

(2009)

Operates a SaaS based supplier financing platform and network, providing

solutions for dynamic/ enhanced discounting, supplier info management,

eInvoicing, and ePayments. Users determine the appropriate information for

their suppliers to view purchase orders, invoice status and approvals, etc.

Capital Raised: 145

Revenue: 20

Market Value: 1,000

Data and Analytics

A broad segment covering market data services, financial research and news, big data credit ratings,

KYC (know your customer), AML (anti-money laundering), fraud detection, and security/

authentication

Company Description/ Service Financials (USD

Millions)

Enhanced market data, news, and research services

Kensho

(2013)

Provides analytical tools for capital markets such as a research and analytics

platform that offers quantitative analyses for financial professionals, statistical

computing software and financial risk analysis applications

Capital Raised: 85

Revenue:

Market Value:

Quovo

(2010)

Data science platform offering applications and services for financial advisors,

institutions, and FinTech companies to more intelligently aggregate and

analyze financial account data

Capital Raised: 5

Revenue: 1

Market Value:

Finalta

(2009)

Helping organizations understand how they compare with peers and providing

them the information they need to improve performance over time

Capital Raised: 4

Revenue:

Market Value:

14

SigFig

(2012)

A big data company providing wealth management and investment advice for

free to help customers build a tax-efficient, diversified portfolio for a fraction of

the cost of a traditional advisor

Capital Raised: 30

Revenue: 1

Market Value:

Estimize

(2011)

An open financial estimates platform which aggregates fundamental estimates

from independent, buy-side, and sell-side analysts, along with those of private

investors and students

Capital Raised: 15

Revenue:

Market Value:

Contix

(2012)

Provides value to traders and investors by delivering actionable, breaking

news from social media sources and placing that news in context. They

employ sophisticated and proprietary technology to identify breaking news

events relevant to financial markets before other news sources

Capital Raised: 2

Revenue:

Market Value:

SumZero

(2008)

A community (>12,000 pre-screened professionals from hedge funds, mutual

funds, and private equity funds) which fosters the sharing of thousands of

proprietary investment analyses and reports, and offers free support services

(e.g., capital introduction services, buy-side career placement services)

Capital Raised: 1

Revenue:

Market Value:

EidoSearch

(2010)

A SaaS company for research and big data analytics focusing on historical

financial data (i.e., patterns and trends).

Capital Raised:

Revenue: 2

Market Value:

Credit ratings

Affirm

(2012)

Calculates a borrower’s risk based on a range of personal data (i.e., social-

media profiles cost of the items being purchased, and determines what rate

and structured payment makes sense to offer the customer

Capital Raised: 320

Revenue: 2

Market Value:

WeCash

(2014)

A China-based big data credit assessment platform that provides solutions for

technology companies. It uses machine-learning algorithms to provide credit

assessments in less than 15 minutes

Capital Raised: 26

Revenue:

Market Value: 100

TrueAccord

(2013)

A debt collection company that leverages data intelligence, machine learning

and behavioral psychology to reach out to debtors and help them set up

payment plans to get back on track and get their debts paid off

Capital Raised: 5

Revenue:

Market Value:

Credit Karma

(2007)

Provides free online credit reports, offsetting the cost of paying for them with

targeted advertising of financial products.

Capital Raised: 370

Revenue: 200

Market Value: 2,500

Avant

(2012)

A marketplace lending platform lowering the costs and barriers of borrowing

for consumers. Using big data and machine-learning algorithms, the company

offers a unique and highly customized approach to streamlined credit options

Capital Raised: 325

Revenue: 75

Market Value: 2,000

Kreditech

(2012)

Custom-tailored financial services (e.g., loans, financial planning) seeking to

disrupt the retail banking industry by improving financial freedom through the

use of technology (i.e., non-traditional data sources and machine learning)

Capital Raised: 300

Revenue:

Market Value:

BLender

(2013)

A multi-continental marketplace lending service in countries with limited

consumer credit information using a proprietary credit rating system

Capital Raised: 5

Revenue:

Market Value:

Integrated banking IT platform

Xero

(2006)

Cloud-based accounting software for small businesses

Capital Raised: 300

Revenue: 127

Market Value: 2,100

nCino

(2012)

A fully-integrated end-to-end bank operating system (combining CRM, loan

origination, workflow, enterprise content management, and instant reporting

capabilities) to increase profitability and productivity, regulatory compliance,

and operating transparency at all organizational levels and lines of business

Capital Raised: 50

Revenue: 6

Market Value:

Meniga

(2009)

Helps retail banks create mutually beneficial digital relationships with their

customers by improving their online/ mobile banking user experience through

innovative solutions to get users to think about and engage with their finances

Capital Raised: 8

Revenue:

Market Value:

15

Avoka

(2002)

For information intensive transactions such as loan applications, account

openings, enrollment forms and insurance claims, Avoka creates a digital,

mobile responsive experience that can be deployed in weeks, rather than the

months of development required by traditional IT projects

Capital Raised:

Revenue: 15

Market Value:

ebankIT

(2014)

Products focused on delivering core banking to customers across all areas of

a bank that they can enjoy and engage with, such as mobile banking, contact

center solutions, banking kiosks, Facebook banking, commercial GPS,

solutions for wearable technology, and ultimately for augmented reality

Capital Raised:

Revenue:

Market Value:

KYC, AML, and Fraud detection

Feedzai

(2009)

A data science company that detects fraud in omnichannel commerce. The

company uses a mix of big data, machine learning and human intelligence to

identify fraudulent payment transactions throughout the world

Capital Raised: 22

Revenue: 11

Market Value:

IdentityMind

Global

(2014)

Provides services in risk management, fraud prevention, and anti-money

laundering technology for banks and online financial services. The company’s

core technology recognizes electronic identities based on every attribute

associated with a transaction, and how those attributes are validated and

relate to one another

Capital Raised: 15

Revenue: 5

Market Value:

Trunomi

(2013)

A platform for financial institutions to comply with know your customer (KYC)

regulations. The software allows individuals to manage their personal

information and documents for financial transactions, as well as financial

institutions to manage customer on-boarding, due diligence, and compliance

Capital Raised: 5

Revenue: 1

Market Value:

Security and authentication systems

Digital

Shadows

(2011)

Provides cyber situational awareness that helps organizations protect against

cyber-attacks, loss of intellectual property, and loss of brand and reputational

integrity

Capital Raised: 22

Revenue:

Market Value:

BioCatch

(2011)

An advanced behavioral authentication system that works with mobile apps,

online businesses and eCommerce. One of the key differentiators is that it

performs continuous authentication, via its advanced behavioral analytics

platform, making it harder for hackers to breach online businesses

Capital Raised: 16

Revenue:

Market Value:

Trading Platforms

This is the lease crowded and mature of all of the FinTech segments. There is tremendous room for

growth within the trading platforms space, especially in utilizing the distributed ledger technologies for

trade clearing, settlement, and optimal collateral management

Company Description/ Service Financials (USD

Millions)

ItBit

(2012)

A blockchain technology platform operating a bitcoin exchange for asset

trading. It is the first bitcoin exchange to become a trust company

Capital Raised: 32

Revenue: 1

Market Value:

MetaMako

(2013)

A technology company that specializes in solutions for latency sensitive

businesses (HTF)

Capital Raised:

Revenue: 4

Market Value:

Cinnober

(1998)

Brings innovation to demanding trading and clearing venues with solutions

based on advanced technology. Deliver multi-asset solutions to market

operators, clearinghouses, banks and brokers; actors with extreme demands

on business functionality, speed and throughput

Capital Raised:

Revenue: 300

Market Value: 700

16

Personal Finance and Investing

Innovations in this segment are focused on enhanced personal financial management tools, access to

markets for early stage/ pre-IPO startups for retail investors and shareholders of private companies,

robo-advisors for advanced trader strategies and execution, and providing fair access to exchanges

and dark pools

Company Description/ Service Financials (USD

Millions)

Personal finance tools

Rong360

(2011)

A vertical financial search platform committed to providing searches of

financial products to consumers and small businesses, giving

recommendations, as well as credit cards and financial management

Capital Raised: 260

Revenue:

Market Value: 1,000

Financial

Force.com

(2009)

Provides a cloud-based service providing Accounting, Billing, Professional

Services Automation (PSA), Revenue recognition, Human Capital

Management (HCM), and Supply Chain Management (SCM) applications

Capital Raised: 180

Revenue: 50

Market Value: 1,500

LearnVest

(2009)

Personal finance software that focuses on behavior change and takes you

from cutting expenses to budgeting for goals to investing your money

Capital Raised: 325

Revenue: 10

Market Value:

FangDD

(2011)

An online platform where home buyers and sellers can connect directly,

working on a "pay-for-performance" business model. The goal is to provide

accurate information about properties, services and transactions to create an

open, cooperative, coexistent and mutually beneficial industrial pattern

Capital Raised: 305

Revenue:

Market Value:

Mint

(2008)

Primary service allows users to track bank, credit card, investment, and loan

balances and transactions through a single user interface, as well as create

budgets and set financial goals

Capital Raised: 200

Revenue:

Market Value:

Housing.com

(2012)

Real estate search portal which allows customers to search for housing

based on geography, number of rooms, and various other filters

Capital Raised: 140

Revenue:

Market Value: 250

VivaReal

(2009)

An online real estate portal that enables its users to sell, buy, rent or invest

in residential and commercial properties throughout Brazil

Capital Raised: 75

Revenue: 10

Market Value:

Robinhood

(2013)

A stock brokerage that allows customers to buy and sell US stocks and

ETFs with zero commission

Capital Raised: 66

Revenue:

Market Value:

BillGuard

(2010)

A mobile and website application that scans credit card and debit card

transactions, alerting users to possible scams, billing errors, fraudulent

charges and hidden fees

Capital Raised: 17

Revenue: 6

Market Value: 30

Stockpile

(2010)

Stockpile Gift Cards, now available at major grocery stores, retailers and

online – can be redeemed for stock in your favorite companies. Buy them for

yourself or gift them to friends and family with no account minimum

Capital Raised: 15

Revenue:

Market Value:

GoHenry

(2011)

A Pre-paid Card and App for kids with unique parental controls for teaching

money management and gaining financial independence. Parents can set

rules and spending limits, set up automatic transfers, create tasks to help

children earn extra money or make one-off money transfers, all in real time

Capital Raised:

Revenue:

Market Value:

Early stage & pre-IPO investments

AngelList

(2010)

Allows startups to raise money from angel investors free of charge

Capital Raised: 650

Revenue:

Market Value:

17

OurCrowd

(2013)

An equity crowdfunding platform, built for accredited investors to provide

venture capital funding for early-stage startups

Capital Raised: 200

Revenue: 5

Market Value:

CircleUp

(2012)

Helps connect high-growth consumer companies with investors, allowing

investors to receive equity in return for their investment

Capital Raised: 35

Revenue:

Market Value:

iAngels

(2013)

Funding Platform that does Equity Crowdfunding Investments

Capital Raised: 24

Revenue:

Market Value:

SeedInvest

(2011)

An equity crowdfunding platform that helps other startups raise capital

Capital Raised: 5

Revenue: 4

Market Value:

Equitise

(2014)

A funding platform where entrepreneurs profile their business plans and set a

funding target, investors commit money to their preferred opportunities and if

funding targets are achieved, shareholder agreements are signed

Capital Raised: 1

Revenue: 1

Market Value:

Equidate

(2013)

A platform giving investors access to pre-IPO companies. It allows

employees and other shareholders to sell their shares in a company without

needing to wait for the company to be acquired or to go through an IPO

Capital Raised:

Revenue:

Market Value:

Robo-Advisors

Nutmeg

(2010)

An alternative to customers making their own investment decisions, the

company invests customers’ funds in line with each individual’s investment

goals and appetite for risk (in listed securities, debt, cash, commodities and

other investment asset classes, primarily, but not exclusively, via ETFs)

Capital Raised: 37

Revenue: 5

Market Value:

Betterment

(2008)

Automates personal investment based on individuals specific preferences

and requirements

Capital Raised: 205

Revenue: 4

Market Value: 700

WealthFront

(2008)

Personalized asset allocation based on your risk score and tax status

Capital Raised: 130

Revenue: 6

Market Value: 750

Motif

Investing

(2010)

A concept-driven platform that allows you to act on your investing desires (a

hot trend like “robotics revolution,” a trading strategy like “buy the dip,” or an

investment style like “Ivy League endowment”) by turning concepts into

motifs—intelligently weighted baskets of up to 30 stocks or ETFs

Capital Raised: 130

Revenue: 5

Market Value: 800

Personal

Capital

(2009)

Online financial advisor and personal wealth manager

Capital Raised: 109

Revenue:

Market Value: 250

Acorns

(2012)

A service helping customers invest. One key feature is rounding up each of

your transactions to the nearest dollar, and investing the change into a

diversified portfolio that is in line with your investment goals and the amount

of risk you’re comfortable taking

Capital Raised: 35

Revenue: 9

Market Value: 85

ZuluTrade

(2006)

An online retail foreign exchange platform that provides social trading

Capital Raised:

Revenue:

Market Value:

Fair access to exchange/ pools

IEX

(2013)

The IEX dark pool aims to attract investors by promising to "play fair" by

operating in a transparent and straightforward manner, while also helping to

level the playing field for traders.

Capital Raised: 75

Revenue: 30

Market Value: 250

eToro

(2007)

Global market place for people to trade currencies, commodities, indices and

CFD stocks online in a simple, transparent and more enjoyable way

Capital Raised: 75

Revenue: 10

Market Value:

18

Neighborly

(2012)

An investment platform allowing users to search/ filter bond issuances by

community, cause or yield without having to invest in public bonds. They

provide direct access for investors and meaningful, understandable data

transparency for all stakeholders, including municipal finance professionals

Capital Raised: 6

Revenue:

Market Value:

Insurance

Innovation in this segment is focused on a couple of key areas – simplifying and streamlining the

customer experience in dealing with the complexities of buying insurance, as well as lowering

premiums through proprietary formulas

Company Description/ Service Financials (USD

Millions)

ZhongAn

(2013)

They utilize big data technology to assist with product design, automatic

underwriting, auto claims, precision marketing and risk management

Capital Raised: 931

Revenue: 350

Market Value: 7,100

Oscar

(2012)

Using technology and healthcare experts to manage care, process medical

claims, control healthcare costs, and provide simplified transparency

Capital Raised: 600

Revenue: 750

Market Value: 2,700

Collective

Health

(2013)

A complete health insurance solution that matches you to the right network

partners across your medical, pharmacy, dental and vision plans, and brings

together your health benefits programs, an intuitive self-funding platform,

proactive business intelligence and a premium member experience.

Capital Raised: 120

Revenue: 10

Market Value: 400

Policy

bazaar.com

(2008)

An online insurance comparison portal offering both life insurance and

general insurance products. It helps consumers take an informed choice

regarding their insurance needs and make comparison an important

intervention in their path to purchase insurance.

Capital Raised: 70

Revenue: 15

Market Value: 200

Knip

(2013)

An innovative digital insurance manager which provides users with an easy-

to-understand overview and analysis of existing insurance policies, tariffs

and services. The app is designed to automatically detect individual’s

insurance gaps and recommend essential insurance.

Capital Raised: 20

Revenue: 1

Market Value:

Friend-

surance

(2010)

Allows small groups of people to anonymously combine their premiums and if

no claims are made, up to 40% of premiums will be returned to the clients.

Insurance not only becomes cheaper for the consumer, but also provides a

financial benefit for careful and fair behavior, which in turn reduces fraud and

reduces the cost of claims for insurance companies.

Capital Raised: 15

Revenue: 1

Market Value:

Coverfox

(2013)

An online insurance policy for people to buy and manage their Insurance in a

smarter way. It offers products online for Indian customers across categories

like Health, Car, Life, Travel and Home Insurance. They have brokerage

licenses (i.e., they have right to negotiate on behalf of the customer)

Capital Raised: 12

Revenue: 3

Market Value:

19

Disclaimer

The opinions presented here are the authors’ personal opinions and do not in any way reflect views of

any of the organizations they are or have been previously associated with

20

Bibliography

1. The Future of Financial Services - How disruptive innovations are reshaping the way financial

services are structured, provisioned, and consumed (World Economic Forum, 2015)

2. The Future of FinTech - A paradigm shift in small business finance (World Economic Forum,

2015)

3. Money of the future (Life SREDA, INSEAD, Deloitte, 2015)

4. The FinTech 2.0 Paper: Rebooting financial services (Santander Innoventures, Oliver

Wyman, Anthemis Group, 2015)

5. The perfect storm of technology and capital markets (KPMG, 2015)

6. Landscaping UK FinTech, Commissioned by UK Trade & Investment (EY, 2014)

7. Disruptions Driving FinTech Investing (Information Venture Partners, 2015)

About the authors

Uday Singh is passionate about Economics and Innovative Technologies for the financial industry. He

has an MBA from Columbia Business School, served as management consultant with McKinsey &

Co, and is currently employed by Credit Suisse

Email: usingh@gmail.com,

Linkedin:http://www.linkedin.com/in/udaysingh

Yatin Chhabra is interested in issues related to Government and Economics and actively studies the

effect of Public Policy in developing countries. He holds a Master’s degree from UPenn and currently

works at Credit Suisse

Email: chhabra.yatin@gmail.com,

Linkedin https://www.linkedin.com/in/yatin-chhabra-83562917

Ben DiPietro is interested in financial markets, global economics, and technology. He graduated from

the University of Michigan with an undergraduate degree in Political Science and a Master’s in

Management with an emphasis in Finance. He is currently a financial analyst at Credit Suisse

Email: benjamindipietro@gmail.com

Linkedin: https://www.linkedin.com/in/benjamin-dipietro-7b3b659b