F INT E C H I NDUSTRY P A Y M E N T P R O C E S S I N G F L A S H R EPORT A PRIL 2019
P RIVILEGED AND C ONFIDENTIAL T HE H ICKORY G ROUP, LLC Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC T A B L E O F C ONTENTS
TOPIC PAGE PAYMENT PROCESSING SECTOR: FLASH REPORT SUMMARY I. PAYMENT PROCESSING SECTOR: FLASH REPORT SUMMARY 1 II. PAYMENT PROCESSING SECTOR: LANDSCAPE 2 III. PAYMENT PROCESSING SECTOR EXPLAINED 3 IV. PAYMENT PROCESSING SECTOR: 2018 TRENDS 4 V. PAYMENT PROCESSING SECTOR: 2019 TRENDS 5 VI. PAYMENT PROCESSING SECTOR: OUTLOOK 6 PAYMENT PROCESSING SECTOR: VC ACTIVITY VII. PAYMENT PROCESSING SECTOR: VC ACTIVITY 7 PAYMENT PROCESSING SECTOR: M&A ACTIVITY VIII. PAYMENT PROCESSING SECTOR M&A ACTIVITY 8 PAYMENT PROCESSING SECTOR: SUMMARY OVERVIEW IX. GLOBAL PAYMENT PROCESSING INDUSTRY 9 X. CHANGING LANDSCAPE 10 XI. GLOBALIZATION → GROWTH OPPORTUNITIES 11 XII. INDUSTRY TAILWINDS DRIVING GROWTH 12 XIII. SELECT PAYMENT PROCESSING PARTICIPANTS 13 FINTECH INDUSTRY: 2019 WATCH LISTS XIV. FINTECH WATCH LIST: MOST VALUABLE OF 2019 14 XV. FINTECH: TOP 50 FOR 2019 15 PAYMENT PROCESSING SUMMARY: 2019 SUMMARY XVI. PAYMENT PROCESSING FLASH SUMMARY 18
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PAYMENT PROCESSING SECTOR: FLASH REPORT SUMMARY
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: FLASH REPORT SUMMARY • The Payment Processing (“PP”) sector of the Financial Tech (“FinTech”) industry is undergoing significant growth due to a variety of factors • Twin drivers of globalization and consumer expectations of ease and availability of payments have been significant tailwinds to the sector • Analysts see these trends continuing in the short-term making the payment processing industry very attractive to Strategics and Sponsors
GLOBALIZATION DRIVING SIGNIFICANT NEED FOR PAYMENT PROCESSING PROVIDING STRONG NEAR- AND MEDIUM-TERM GROWTH TO THE INDUSTRY
GLOBAL MARKET FOR ELECTRONIC PAYMENTS IS SIGNIFICANT TOTAL GLOBAL CARD PAYMENT VOLUME OF APPROX. $23TN IN 2017
VARIETY OF FORMS OF PAYMENT IS NOW VIEWED AS AN ENABLER OF COMMERCE ACROSS THE GLOBE
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: LANDSCAPE • The Payment Processing Sector is divided into 5 general verticals: Acquirers/Processors, Card Networks, Issuers, Gateways and ISOs/MSPs E X H I B I T 1 P A Y M E N T S E C O S Y S T E M O VERVIEW : 2019
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: EXPLAINED
Owns Mobile Devices 1 Customer 9 New Payment Companies Makes a $100 Authorizes credit card transaction Threaten (Square, PayPal etc.) 10 purchase Bills Threaten Cardholder $100 Provides
POS Merchant Payment
2 8 Processor Independent Sales Requests Authorizes (Verifone, NCR Organizations (ISOs) Authorization for transaction, keeps etc.) Set up businesses to $100 $0.19 in acquiring accept credit cards fees and pays merchant $97.25 7
Acquiring Bank Paid remainder of merchant fee Supplies Customers (Chase, BAML, $0.23 in network with Credit Cards to First Data, Vantiv fees Make Purchases etc.) 3 6 100 USD Purchase Requests Keeps $0.13 in Authorization for network fees by Consumer $100
Card Network (Visa, Mastercard etc.) Goes to Issuing Payment Acquiring Card 4 5 Merchant Bank Processor Bank Network Requests Approves Authorization for transaction and $100 transfers money. $97.25 $2.20 $0.23 $0.19 $0.13 Keeps $2.20 in interchange fees
Issuing Bank Chase, BAML etc. PAGE 3 PRIVILEGED AND CONFIDENTIAL
Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: 2019 TRENDS • The payment processing sector is experiencing significant growth due to end-consumer demand and significant technology advancements E X H I B I T 2 T R E N D S E XPECTED TO I NFLUENCE THE I NDUSTRY IN 2019
S T R A T E G I C C OMMENTS C ONSIDERATION • Shoppers will be offered an • For a long time, there were just two primary payment experiences—you either went to increasing variety of experiences a store and handed your payment to a cashier; or you shopped online and entered your information on a checkout page • In recent years, payments began to diverge from those familiar paths – a trend that will pick up in 2019 • More businesses will look for • Simplification is a payment processing industry trend that continues to grow ways to simplify their payment ➢ All-in-one payment solutions are available that provide extensive and flexible coverage for just stack about anything a merchant wants to offer ➢ A growing number of merchants will take advantage of these solutions in 2019 to make payments easier • Difficulty in balancing customer • In 2019, the tension between providing a frictionless customer experience and the experience goals w/fraud goals need to reduce fraudulent purchases will force more merchants to reevaluate the way they manage fraud • B2B billing for small- and • B2B payments account for c. $38Tn. A major part of these payments is still made by medium-sized businesses will traditional paper checks transition to digital • While the disadvantages of a paper billing system have been acknowledged, the switch to digital hasn’t advanced until recently • The number of cross-border • The number of outlets in 2018 that reported on the popularity of digital cross-border eCommerce transactions will buying grew significantly increase ➢ eMarketer Retail reported on a recent survey showing that 70% of online buyers made a purchase from a foreign site in 2017, up 6 percentage points from the year before ➢ Accenture predicts that more than 200Mm Chinese will be cross-border shopping by 2020, generating a total transactional value of c. $245Bn
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: 2018 TRENDS • The payment processing sector in 2018 experienced significant growth due to various factors
E X H I B I T 3 T R E N D S T H A T I NFLUENCED THE I NDUSTRY IN 2018
S T R A T E G I C C ONSIDERATION C OMMENTS
• Fintech unbundling leads to re-bundling • Re-bundling had a false start in 2018, as startups underestimated the time to market and regulations • In 2019, the battle for millennial deposits will become more aggressive as fintech account products hit the market • European Fintechs will expand their global • Digital-first banks flourished in Europe under tech favorable footprint regulations and funding environment • Banks forgo partnering in favor of fighting • Goldman Sachs was the most active in investing and building out fintech with fintech fintech with retail bank Marcus • Latin America and Southeast Asia will see • Both Latin America and South East Asia fintech deals and funding hit strong fintech growth annual highs in 2018 • Capital markets fintech infrastructure becomes • Plaid became the first infrastructure unicorn and started 2019 by a focus area for investment acquiring competitor Quovo • Amazon is primed to get more aggressive in • Amazon picked up fintech investments in India, a key growth market fintech — outside of the US for the e-commerce giant
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: OUTLOOK • The payment processing sector is experiencing significant growth due to end-consumer demand and significant technology advancements E X H I B I T 4 P A Y M E N T P ROCESSING S ECTOR O U T L O O K
S T R A T E G I C C ONSIDERATION C OMMENTS
• The battle for deposits • Fintech Companies will aggressively compete for market share from Tier-1 banks
• Fintech firms up focus on regulatory • Fintech brings advantages and opportunities to the financial industry as well as compliance challenges and risks. Regulation can go a long way to minimizing said risks • The next Ant Financial & WeChat Pay • U.S. is ripe for players like Amazon to compete w/WeChat Pay & Ant Financial • Southeast Asia sees hotbed of FinTech • FinTech investments in SE Asian countries in 2018 have exceeded the $6Bn invested activity in 2017. The FinTech market is projected to reach US$72Bn by 2020 • Capital markets FinTech infrastructure • Fintech activity in capital markets infrastructure has grown by c. 300% since 2010 on the up • Unbundling the paycheck • A host of emerging startups are attacking the various payroll services sector • New investment platforms & asset • Disruptive Fintech companies such as Robin Hood and Stash will grow classes • Fintech meets real estate • Real estate startups (LendingHome, Opendoor & Roofstock) are reshaping the homebuying experience from the ground up • Rise of impact FinTech • Fintech in underbanked communities/countries will draw interest from investors • Lack of FinTech M&A by banks no • Banks are deploying multiple investment strategies longer an issue • No-go for FinTech IPOs • There are now close to 30 private fintech startups with valuations at or above $1Bn but candidates will face obstacles due to poor IPO performance of recent peers
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PAYMENT PROCESSING SECTOR: VC ACTIVITY
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING SECTOR: VC ACTIVITY • VC Activity in the Payment Processing industry has been significant ➢ In the short term we expect this trend to continue however, as the industry matures one can rationally expect the number of VC investments to drop
E X H I B I T 5 P A Y M E N T P ROCESSING : G L O B A L VC I NVESTMENTS BY G EOGRAPHY : CY14 – CY18
$40 $Bns $38.1 $3.5 $35
$30
$25 $22.7 $20 $18.6 $1.4 $17.2 $15.9 $2.8 $15 $2.0
$5.0 $11.3 $6.2 $10 $8.0 $1.2 $1.1 $11.9 $5 $8.8 $8.2 $5.7 $5.9 $0 CY2014 CY2015 CY2016 CY2017 CY2018
US Asia Europe
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PAYMENT PROCESSING SECTOR: M&A ACTIVITY SUMMARY
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PAYMENT PROCESSING SECTOR M&A ACTIVITY • M&A Activity in the Fintech space has been robust throughout 2018 and into Q1 2019 E X H I B I T 6 P A Y M E N T P ROCESSING : S IGNIFICANT M&A A CTIVITY : 2018 – Q1 2019
Company Year Completed Country Funding Type Amount ($Mm) Investors
2019 USA Merger 22,000 Fiserv, Inc.
2019 USA Acquisition 35,000 Fidelity National Information Services, Inc.
2018 USA Acquisition N/A Variant Equity
2018 Sweden Acquisition 2,200 PayPal Holdings, Inc.
2018 USA Acquisition 10,630 Vantiv
2018 USA Acquisition N/A Synergy Commerce
2018 USA Business Unit Acquisition 93 Wausau Financial Systems
2018 USA Acquisition 400 PayPal Holdings, Inc.
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PAYMENT PROCESSING SECTOR:
SUMMARY HIGHLIGHTS
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GLOBAL PAYMENT PROCESSING INDUSTRY
• The global market for electronic payments is very large with total global card payments volume of approximately $23.0Tn in 2017 forecasted to grow to approximately $52.4Tn by 2026 (CAGR of 9.6%), according to Nilson ➢ The market is experiencing a pronounced and ongoing shift away from cash and towards card-based, international and local payment methods. This shift towards cashless payments is being driven by a number of factors, including increased penetration driven by new technologies (such as contactless payments), lower transaction fees and the growing prevalence of online and mobile channels ➢ The payments industry is fragmented on the acquiring, issuing and processor side; however, most of the volume passes through payments schemes such as Visa, Mastercard, UnionPay and American Express. The volume processed by the payments schemes has grown significantly over the last few years, with Visa and Mastercard processing close to $11.4Tn or ~49% of total global card payments volume in 2017, up 9.6% on 2016, according to Nilson
E X H I B I T 7 G L O B A L P A Y M E N T S R E V E N U E G ROWTH 60.0
52.4
50.0
R G A C % 40.0 10 +
s
n
o i
l
l 30.0
i
r
T
$ 23.0 Source: Nilson April, 2018 R 20.0 AG C % 14 +
10.0 5.3
0.0 2006A 2017A 2026E
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CHANGING LANDSCAPE
• Alongside the growth in payments purchases, the global payments and commerce landscape is changing. In large part, this is being driven by: ➢ The increasing globalization of commerce ➢ Changing shopper behavior and the rise of mobile ➢ Increasing pressure on retail merchants' operations; and ➢ An increasingly complex and demanding regulatory environment driving new business models and forcing change. • In light of this ongoing and rapid transformation of payments and commerce, merchants are increasingly focusing on payments. Payment acceptance is no longer seen as an inhibitor but as an enabler of commerce.
E X H I B I T 8: K E Y M A C R O T RENDS E X H I B I T 9: C H A N G I N G M ARKET
- -Full Range of -Ability to process online and mobile payments -Back-end merchant Services(Incl. PSP acquirer relationship Connectivity) -Robust payment features and functionalities -Acquirer with efficient - Ability to act as a single and fast on-boarding provider of services to -Business bank accounts processes merchant clients -Integrated security -Ability to monitor and -Innovative value-added solutions protect against fraud services and capabilities -Fraud management -"One-stop-shop " for - Manage multiple payment capabilities acquiring and regulatory forms (e.g. alternative -Straightforward technology compliance payments integrations -Additional value-added -Meet Increasingly complex -Reliable offerings with full services for merchants regulatory and compliance support (e.g. recurring payments , standards -Single provider for all virtual terminals) needs
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC GLOBALIZATION → GROWTH OPPORTUNITIES • Globalization & international expansion continues to be a driving force in the world economy, creating new opportunities for businesses of all sizes to grow and expand • While globalization as a phenomenon has been developing for several years, global multi-country commerce has accelerated due to the impact of e-commerce. Market tailwinds are driving massive payment processing growth opportunities • What this means for merchants is that, aside from the additional logistical challenges which they need to address, they also need to be able to provide locally-tailored payment solutions and currencies to suit the needs of a global shopper base transacting with an equally global merchant base
E X H I B I T 10 2008-2018 U.S. E L E C T R O N I C P A Y M E N T S R EVENUE
$4.00 80.00% 72.90% 70.40% $3.56 $3.50 67.20% 70.00% 63.50%
58.90% $3.00 63.80% $2.91 60.00% 52.40% $2.50 50.00% $2.32
$2.00 40.00% $1.80 40.30%
$1.50 $1.36 33.00% 30.00% 28.60% $0.97 25.40% $1.00 22.20% 20.00%
$0.50 10.00%
$0.00 0.00% 2016 2017 2018 2019 2020 2021 Retail m-commerce sales % Change % of E-commerce Sales
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC SELECT PAYMENT PROCESSING PARTICIPANTS • The following chart presents select notable PP sector participants
E X H I B I T 11 P A Y M E N T P R O C E S S I N G P ARTICIPANTS
PARTICIPANT BUSINESS DESCRIPTION COMMENT • Stripe Inc. offers a cloud-based payment platform that connects • No monthly fees 1. Stripe businesses with credit card and banking systems to receive • No distinction between gateway and acquiring payments. The technology enables vendors to accept credit card • 1.4% + £0.20p EUROPE // 2.9% + £0.20p REST OF payments, point-of-sale transactions and mobile payments. Stripe WORLD handles tens of billions of online transactions a year, charging a • Bespoke pricing for larger volumes fee on each one and offers a variety of other financial services, • POS Solution including fraud detection, recording keeping, and a credit card • Very flexible API • Good functionality for developers • Low/medium risk appetite • Very easy set-up • Paypal enables individuals and merchants to electronically transfer • No monthly fees 2. PayPal money, with payments originating from a customer's bank • No distinction between gateway and acquiring account, credit card, or PayPal account. The company earns fees • 1.4% + £0.20p EUROPE // 2.9% + £0.20p REST OF from payment transactions, foreign exchange, and related PayPal WORLD platform transactions • Bespoke pricing for larger volumes • PRO option available, with comparable monthly fee for gateway and transaction fees to our standard offering • No POS • Low risk • Very easy setup • Worldpay provides payment processing technology and • Comparable fees to ST 3. Worldpay solutions. The company offers online payment gateway, card and • Omnichannel offering mobile payments, fraud and risk management, data and analysis, • Similar risk appetite and treasury service • Products held back for larger size customers • Lengthy application process for acquiring • Adyen is a payment processor company worldwide, enabling the • Omnichannel offering 4. Adyen acceptance and processing of cards and local payments across its • Large suite of payment methods and types with global coverage merchants' online, mobile and point of sale channels for acquiring connections
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FINTECH INDUSTRY: 2019 WATCH LISTS
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FINTECH WATCH LIST: MOST VALUABLE OF 2019 • The following FinTech watch list is comprised of the most valuable VC backed US-based firms per industry analysts E X H I B I T 12 F INT E C H W A T C H L I S T P E R FORBES : M O S T V A L U A B L E C OMPANIES OF 2019 COMPANY/ BUSINESS DESCRIPTION COMMENT VALUATION 1. Stripe/$23Bn • Stripe has grown from serving small online firms to Microsoft and Amazon, too. In 2018 the • Notable VC Backers include: Sequoia Capital, company announced three credit card issuing technology, point-of-sale software and a billing Tiger Global Management, YCombinator, platform for subscription businesses Thrive Capital, & Founders Fund 2. Coinbase/$8Bn • Expanding beyond its roots as a bitcoin wallet and retail exchange, Coinbase now offers • Notable VC Backers include: Tiger Global cryptocurrency custody and professional and institutional trading platforms. In 2018 the company Management, IVP, DFJ, & Andreessen bought Earn.com, a service where users pay in bitcoin to contact experts via email, for c. $100Mm Horowitz 3. Robinhood/$6Bn • Offers commission-free trading of stocks, ETFs, cryptocurrencies & options via mobile app. • Notable VC Backers include: DST Global, Index Robinhood Gold subscription service, starting at $6 per month, gives investors access to margin Ventures & New Enterprise Associates trading. Plan to take on the checking and savings market with a new cash management program 4. Ripple/$5Bn • Its blockchain-based global settlements network aims to replace SWIFT, the interbank messaging • Notable VC Backers include: SBI Investments, platform that has long connected nearly every bank in the world and a service that lets companies Santander InnoVentures, IDG Capital & Core make cross-border payments in XRP, the cryptocurrency created by Ripple’s founders Innovation Capital 5. SoFi/$4Bn • Founded in 2011, SoFi started with online student loan refinancing and later branched into other • Notable VC Backers include: Softbank, Silver services for affluent Millennials, including mortgages, robo-investing advice and life insurance Lake Partners, Third Point Ventures, Discovery Capital, Baseline Ventures, & The Bancorp 6. Credit Karma/$4Bn • Offers its 85Mm+ “members” a growing suite of free services, including credit scores, tax-prep • Notable VC Backers include: Silver Lake software, help fixing credit-report errors and alerts of new accounts opened in a user’s name. Credit Partners, SV Angel, CapitalG, Susquehanna Karma earns referral fees when users bite on the personalized offers for credit cards/loans Growth Equity, & QED Investors 7. Circle/$3Bn • Crypto-finance giant Circle last year entered the exchange business with the purchase of Poloniex & • Notable VC Backers include: Goldman Sachs, now offers services for cryptocurrency trading, investing and payments. Beyer Capital, IDG Capital, Bitmain
8. Plaid/$3Bn • Connects payment apps like Venmo and personal finance sites like Betterment to users’ bank • Notable VC Backers include: Index Ventures, accounts to transfer/track funds and speed up authentication. Plaid now integrates with 10,000 Kleiner Perkins, Goldman Sachs, New banks. In January it acquired Quovo, a startup that aggregates investment data, for c. $200Mm Enterprise Associates & Spark Capital 9. Avant/$2Bn • Consumer credit firm provides online loans ranging from c. $2k to $35k • Notable VC Backers include: KKR, General Atlantic, Tiger Global Management & Jeffries 10. Gusto/$2Bn • Helps businesses with 1-100 EEs with HR services: Monthly pricing: Basic services (full payroll but • Notable VC Backers include: Capital IG, no access to HR experts) is $39, plus $6 per EE; Full-service it’s $149 plus $12 per EE Acadian Ventures, General Catalyst, YCombinator & Ribbit Capital 11. Zenefits/$2Bn • Cloud-based software to help businesses automate payroll, benefits and HR. • Notable VC Backers include: TPG, Fidelity Investments, Andreessen Horowitz & Venrock Source: Forbes www.forbes.com/sites/jeffkauflin/2019/02/04/the-10-biggest-fintech-companies-in-america-2019/#4fdd88d932b9
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FINTECH TOP 50 FOR 2019 • The following “FinTech 50” company watch list is per a recent Forbes review
E X H I B I T 13 F INT E C H W A T C H L IST : T O P 50 F INT E C H C OMPANIES FOR 2019
COMPANY CATEGORY FUNDING ($MMS) STRATEGIC COMMENTS
1. Acorns Personal Finance $257 • Doubled AUM in 2018 vs 2017 bring AUM to c. $1.2Bn 2. Addepar Wall Street $240 • Added six new executive hires, reflecting healthy growth 3. Affirm Lending $450 • Recently disclosed partnership with Walmart stores & website 4. Axoni Wall Street $59 • Raised c. 32Mm in series B funding (November 13th 2018) 5. Ayasdi Wall Street $106 • Named 2019 Innovation Champion by Accenture 6. Behavox Wall Street $15 • Recently announced Google Cloud partnership 7. Betterment Investing $275 • Added CRM integrations to RIA platform in March of 2019 8. Bitfury Crypto & Blockchain $150 • Brings Lightning Payments to US Payment Gateway HadePay 9. Blend Real Estate $160 • Recently hired former Fannie Mae chief Timothy Mayopoulos 10. Bolt Payments $20 • Annualized payment volume of more than $1Bn in just a year 11. Brex Payments $215 • Launches New Credit Card For E-Commerce Merchants (2019) 12. Cadre Real Estate $133 • Plan to aggressively attack opportunity zones Q4 2018 13. Carta Wall Street $148 • Announced an $80Mm Series D at a valuation of $800Mm 14. Chime Personal Finance $105 • Tripled its previous valuation passing the $1 billion-mark (2019) 15. Circle Crypto & Blockchain $246 • Crypto bear market significantly impacting their valuation Source: Forbes www.forbes.com/sites/jeffkauflin/2019/02/04/the-10-biggest-fintech-companies-in-america-2019/#4fdd88d932b9
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FINTECH TOP 50 FOR 2019 ( CONT ’ D ) • The following “FinTech 50” company watch list is per a recent Forbes review
E X H I B I T 13 ( CONT ’ D ) F INT E C H W A T C H L IST : T O P 50 F INT E C H C OMPANIES FOR 2019
COMPANY CATEGORY FUNDING ($MMS) STRATEGIC COMMENTS
16. Coinbase Crypto & Blockchain $525 • Changing its fee structure with higher value clients paying less 17. Credit Karma Personal Finance $869 • Made Significant Move with New Insurance Experience (2018) 18. Cross River Wall Street $128 • Relocating to a new headquarters in Jerusalem 19. Digital Reasoning Wall Street $110 • Recently announced a strategic investment from Macquarie 20. Earnin Personal Finance $190 • Raised $125Mm to aid workers track and cash out wages (2018) 21. Enigma Wall Street $130 • Raised $95Mm to Connect Enterprise to Real-World Data 22. Even Personal Finance $51 • Partnership leads to 200k Walmart employees using Even (2018) 23. Flywire Payments $142 • Recently surpassed $10Bn in total payments volume 24. Forter Payments $100 • Named one of the hottest young tech companies in Israel (2019) 25. Fundrise Real Estate $59 • Delivered more than $5.9Mm in dividends during Q4 2018 26. Gemini Crypto & Blockchain NA • Launched New Mobile App for Crypto Traders in late 2018 27. Guideline Investing $59 • Secured c.$35Mm series C round led by Tiger Global Mgmt. 28. iCapital Network Investing $80 • Exclusive feeder fund provider for Morgan Stanley (2019) 29. IEX Group Wall Street $100 • Welcomed Interactive Brokers as the first IEX Founding Issuer 30. Kabbage Lending $489 • Announced third securitization March 6th 2019
Source: Forbes www.forbes.com/sites/jeffkauflin/2019/02/04/the-10-biggest-fintech-companies-in-america-2019/#4fdd88d932b9
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FINTECH TOP 50 FOR 2019 ( CONT ’ D ) • The following “FinTech 50” company watch list is per a recent Forbes review
E X H I B I T 13 ( CONT ’ D ) F INT E C H W A T C H L IST : T O P 50 F INT E C H C OMPANIES FOR 2019
COMPANY CATEGORY FUNDING ($MMS) STRATEGIC COMMENTS 31. Lemonade Personal Finance $180 • Recently announced European expansion from U.S. 32. LendingHome Real Estate $166 • Topped $3 Bn in Loan Originations in late 2018 33. Marqeta Payments $116 • Recently announced European expansion from U.S. 34. Nova Credit Lending $20 • Recently partnered with TransUnion to boost Canadian market 35. Opendoor Real Estate $1,000 • Raised c. $300Mm of growth equity in March of 2019 36. Personal Capital Investing $225 • C. 9Bn AUM as of March 18, 2019 37. Plaid Payments $310 • Bought competitor Quavo for c.$ 200Mm 38. Poynt Payments $132 • Partnered with SpotOn to deliver all-in-one marketing solution 39. Remitly Payments $175 • World's Most Innovative Companies list by Fast Company(3rd) 40. Ripple Crypto & Blockchain $94 • Santander recently increase its equity position in the Company 41. Robinhood Investing $539 • Revealed U.K. expansion plan in Q1 2019 42. Roofstock Real Estate $75 • Recently unveiled new shared ownership program 43. Root Insurance Personal Finance $178 • Plans to add 350 jobs in 2019, blowing past five-year hiring goal 44. Stash Investing $117 • Stash Launches Fit-For-Millennial Banking 45. Stripe Payments $685 • Gained COO from Goldman Sachs Marcus business unit 46. Symphony Wall Street $300 • Symphony now has 375,000 individual users at 350 companies 47. Tala Lending $105 • Recently announced expansion into larger facility 48. Toast Payments $248 • Recently raised c.$115Mm to build out Toast Go POS device 49. Tradeshift Payments $400 • Recently awarded for best CSR/ESG Technology Solution 50. TransferWise Payments $397 • Secondary share sale will value Transferwise at c.£3bn Source: Forbes www.forbes.com/sites/jeffkauflin/2019/02/04/the-10-biggest-fintech-companies-in-america-2019/#4fdd88d932b9
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PAYMENT PROCESSING SECTOR: FLASH REPORT SUMMARY
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Downloaded from www.hvst.com by IP address 192.168.160.10 on 09/29/2021 T HE H ICKORY G ROUP, LLC PAYMENT PROCESSING FLASH SUMMARY • The significant growth of the Payment Processing sector of the Financial Tech industry presents significant capital opportunities for Strategics and Sponsors • The Payment Processing sector is, perhaps, the most scalable business model, available • Analysts see the tailwind trends continuing in the near- and medium-term, making the Payment Processing sector compelling to both Strategics and Sponsors
GLOBALIZATION DRIVING SIGNIFICANT CHANGES IN THE WAY PAYMENTS ARE PROCESSED THUS PROVIDING STRONG GROWTH TO THE INDUSTRY
GLOBAL MARKET FOR ELECTRONIC PAYMENTS IS VERY LARGE WITH TOTAL GLOBAL CARD PAYMENTS VOLUME OF APPROX. $23TN IN 2017
PAYMENT ACCEPTANCE IS NO LONGER SEEN AS AN INHIBITOR BUT AS AN ENABLER OF COMMERCE
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