Welcome to TechCrunch Fintech! This week, we look at how two fintech companies serving the underserved are doing, and more!
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the great story
PayJoy is an example of a company with positive unit economics and a mission to help the underserved. It's not often that we see those two things intersect, so when we do, we get really excited. I wrote about the company's milestone of achieving $300 million in annualized revenue and profitability last year, while also raising $150 million in Series C funding. The company's model is unique: it helps people generate credit through pay-as-you-go financing for smartphones. Once the phones are paid off, customers can apply for loans through PayJoy using their devices as collateral. Read all about its growth here.
Analysis of the week
Petal is another fintech company that aims to help the underserved “build credit, not debt.” Last May, TechCrunch wrote about the company's $35 million raise and its plans to spin off its data unit. Last week, Empower Finance announced plans to acquire Petal, which apparently began looking for buyers last year “when it was strapped for cash,” according to Fortune. A Petal spokesperson told me via email: “Like Petal, Empower…uses cash flow underwriting for its suite of credit products. …With the acquisition of Petal, you will soon have a family of credit cards to complement that offering.” Will we see more mergers and acquisitions in 2024? I'm looking forward to seeing.
dollars and cents
TransferGo, the UK-based fintech best known as a consumer platform for global remittances, has raised a $10 million growth funding round from Taiwan-based investor Taiwania Capital, with a view to expanding in the Asia region and the Pacific. It last raised a $50 million Series C funding round in 2021. TransferGo says its growth, combined with the new investment, doubles its valuation.
What else are we writing?
brazilian startup save, an enterprise mobile operator, was the only Latin American-based company in Y Combinator's latest batch, the accelerator confirmed to TechCrunch's Anna Heim. This is a significant drop compared to the cohorts that stepped on the accelerator during COVID when it was remote, but also to more recent classes. For example, there were 33 Latin American companies in Y Combinator's Winter 2022 batch. Could the overall state of the fintech sector be partly to blame? Historically, about a third of the 231 Latin American companies that passed through YC focused on fintech. And with fintech funding on the decline, this could perhaps partly explain YC's lack of interest in Latin America.
High Interest Headlines
Investors surround 'most hated' fintech and e-commerce sectors
Stride and Utah set new precedents in benefits for independent workers
US startup Parafin secures $125 million warehouse from SVB and Trinity Capital
ai-driven-accounts-receivable-platform/” target=”_blank” rel=”noopener”>Tabs Secures $7M Seed Funding to Improve ai-Powered Accounts Receivable Platform
UAE fintech Fortis raises $20 million in Series A round
Anrok reaches a valuation of 250 million dollars with a mundane idea: calculate
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