News Briefing - Crowdfunding, SME And Alternative Finance

An angel, blowing bubbles

1.UK – FinTech 

Altfi reports; 


“Just six months after raising its last equity funding roundFronted is back with a bang today, closing a £20m debt and equity round to help it expand to a whole new section of the rental market. 

Fasanara Capital is leading the funding, and Fronted CEO Jamie Campbell told AltFi that the majority of the raise is debt with only around £1m as equity. 

With the new cash, Fonted is introducing a new ‘Lifetime Deposit’ product aimed at existing renters who need to provide a new deposit to move before they’ve received their last deposit. 

“On average, this is a 35-day overlap, and when deposits, on average, are around £1,300, you’re looking at more than £2000 worth of cash flow issues for tenants,” Fronted CEO Jamie Campbell told AltFi. 

Fronted’s Lifetime Deposit solution is a 10-week bridge financing product with a £40 one-off deposit that sees renters able to ‘unlock’ their existing deposit and use it towards their next property, with Fronted receiving this deposit at a later date once it’s released. 

The new product is aimed at “the largest cohort of people in the rental market, who are moving from one property to the next,” according to Campbell.” 

 

2. UK – FinTech 


Crowdfundinsider reports: 

 

Circle, a digital asset firm that is a top stablecoin issuer and owner of investment platform SeedInvest, has invested $10.5 million in CrowdcubeThe total funding round was $13.5 million. Circle’s investment in Crowdcube was made via USD Coin (USDC) – a dollar-based stablecoin. The percentage of ownership was not immediately available. 

Crowdcube is one of the largest online investment platforms in the world based in the UK but operating across Europe. Crowdcube currently claims over £1 billion invested in securities listed on its site and 1.2 million “members.” Crowdcube recently stated its intent to boost operations across the European Union (EU) following approval of harmonized pan-European crowdfunding rules. Crowdcube also operates a secondary marketplace where investors may gain access to liquidity in private shares prior to an IPO or acquisition. 

SeedInvest has funded hundreds of companies, raising over $400 million under the full stack of securities exemptions, while creating a growing network of over 600,000 investors.” 

 

3. UK – SMEs/FinTech 

 

Finextra reports: 


“In a bid to counter account switching fatigue, Tide is opening access to its suite of business banking tools to SMEs who hold accounts with other banks. 

Starting today, Tide will give business owners the opportunity to connect their third party business bank account to Tide to access Cashflow Insights, a product that predicts a business’s future cash flow, using data from their business bank account.

Over time, Tide will extend the service offering to products ranging from invoicing, to expense management, payroll and credit services.

Oliver Prill, Tide CEO, says: “Tide is a business financial platform. On the platform, businesses have a choice between using Tide or partner label products. Now we are extending this concept to current accounts. We are all about serving small businesses optimally making sure that all products work seamlessly together, not about forcing SMEs into a Tide label product.”

The initiative is intended to attract businesses who are traditionally deterred from the hassle of switching accounts or hold accounts with multiple financial institutions.

Surveys regularly report that around 13% of businesses look to switch banks within 12 months, yet in practice only an estimated 4% actually switch per annum, due to the high demand business owners have on their time and the complexity of informing business partners of new bank details.” 

 

 

4. US – FinTech 

 

Finextra reports: 

 

“American banking regulators have put together a roadmap that will see them offer clarity over the next year on a host of areas relating to crypto assets. 

With mainstream financial services firms becoming increasingly interested in crypto, the Federal Reserve System, Federal Deposit Insurance Corporation (FDIC) and Office of the Comptroller of the Currency (OCC) have been scrambling to get up to speed.

The watchdogs have been carrying out a series of "policy sprints" to get preliminary analysis on various issues regarding crypto-assets.

Now, the agencies are promising to offer greater clarity on whether some of these activities conducted by banks are legal and what is expected in terms of safety, consumer protection and regulatory compliance.

Throughout 2022, guidance will be given on: 

  • Crypto-asset safekeeping and traditional custody services 
  • Ancillary custody services 
  • Facilitation of customer purchases and sales of crypto-assets 
  • Loans collateralised by crypto-assets 
  • Issuance and distribution of stablecoins 
  • Activities involving the holding of crypto-assets on balance sheet 

 

 

5. International – FinTech 


Altfi reports: 


Allica Bank, a new challenger SME bank, has made its first major acquisition with an agreement to acquire 2,000 SME customers and a c.£600m loan book from AIB Group  

One of Ireland’s four largest banks, AIB has recently exited from the SME market in the UK in a cost-cutting drive. 

Since launching in March 2020, Allica Bank has been on the warpath to compete in the increasingly competitive ‘middle’ segment of the SME market.  

Whilst hiring senior fintech leaders in the form of Richard Davies, formerly banking CEO at Revolut as its CEO and Conrad Ford, formerly founder and CEO of Funding Options, as its chief product officer, it is also blending a hybrid analogue and digital strategy. For example, customers are given a dedicated customer relationship manager who meets with firms. 

Following the purchase of the AIB loan book, Alllica says it is bringing forward its target profitability date to the middle of 2022.”