Private Markets, Angel and Secondary Investing, Sacra

Sacra

Private Markets, Angel and Secondary Investing

Bringing transparency to private markets so investors, founders, and employees can build on conviction. Sacra delivers deeply researched insights on the private companies shaping tomorrow's markets. By surfacing the data, context, and operator perspective that are missing from private markets today, we help secondary buyers and sellers price equity accurately and unlock liquidity for the people building these businesses.

Private Capital Markets

<ul><li>We looked for emerging market leaders that sold not just to the growing fintechs, but those that could sell to both and could crack the up-and-comers and the legacy incumbents.</li><li>Some of these waves are ongoing, while the B2B payments software wave and a few new ones are percolating, but that&#39;s how I would summarize them quickly.</li><li>Fraud, in financial services, is a big industry and it&#39;s only going to grow.</li></ul>

We looked for emerging market leaders that sold not just to the growing fintechs, but those that could sell to both and could crack the up-and-comers and the legacy incumbents.Some of these waves are ongoing, while the B2B payments software wave and a few new ones are percolating, but that&#39;s how I would summarize them quickly.Fraud, in financial services, is a big industry and it&#39;s only going to grow.

Charles Birnbaum, Partner At Bessemer Venture Partners, On The Five Waves Of Fintech

Chime Financial / Private Capital Markets

<ul><li>In April 2024, Chime hit $1.5B in annualized revenue with 7M customers (“most with direct deposit”) for ARPU of $214—Chime is now on track to hit $1.9B by the end of 2024, up 46% year-over-year after growing 30% to $1.3B in 2023.</li><li>Now, Chime is launching the fintech product—lending—that has been the biggest driver of increased profits for neobanks around the world, offering loans of up to $1,000 in alignment with their risk-off philosophy around products for low-income consumers.</li><li>Chime (2012) found product-market fit offering totally free checking accounts to the 58% of working adults (about 138 million people) making less than $65K per year just as big banks like Wells Fargo (NYSE: WFC) were introducing minimum balance requirements to recoup revenues post-Great Financial Crisis.</li></ul>

In April 2024, Chime hit $1.5B in annualized revenue with 7M customers (“most with direct deposit”) for ARPU of $214—Chime is now on track to hit $1.9B by the end of 2024, up 46% year-over-year after growing 30% to $1.3B in 2023.Now, Chime is launching the fintech product—lending—that has been the biggest driver of increased profits for neobanks around the world, offering loans of up to $1,000 in alignment with their risk-off philosophy around products for low-income consumers.Chime (2012) found product-market fit offering totally free checking accounts to the 58% of working adults (about 138 million people) making less than $65K per year just as big banks like Wells Fargo (NYSE: WFC) were introducing minimum balance requirements to recoup revenues post-Great Financial Crisis.

<ul><li>Mercury is becoming the Booking.com of startup banking, aggregating demand using free checking accounts and the best banking experience to commoditize suppliers (partner banks) who pay for access to Mercury’s customer base.</li><li>SVB got unbundled during COVID and then unwound completely in 48 hours, with Mercury and Brex initially emerging as the primary beneficiaries, with Mercury adding $2B+ in deposits and thousands of customers in a week.</li><li>SVB’s growth left it vulnerable to bottom-up disruption from Mercury and Brex (both founded in 2017), which offered bank accounts and corporate cards to underserved startups outside the core Silicon Valley clique (e.g., international startups).</li></ul>

Mercury is becoming the Booking.com of startup banking, aggregating demand using free checking accounts and the best banking experience to commoditize suppliers (partner banks) who pay for access to Mercury’s customer base.SVB got unbundled during COVID and then unwound completely in 48 hours, with Mercury and Brex initially emerging as the primary beneficiaries, with Mercury adding $2B+ in deposits and thousands of customers in a week.SVB’s growth left it vulnerable to bottom-up disruption from Mercury and Brex (both founded in 2017), which offered bank accounts and corporate cards to underserved startups outside the core Silicon Valley clique (e.g., international startups).

Mercury: The Unbundling Of Silicon Valley Bank

<ul><li>"2022 was obviously an interesting time for fintechs."</li><li>"Embedded finance is definitely ramping up."</li><li>"The last year has really confirmed our model and approach."</li></ul>

"2022 was obviously an interesting time for fintechs.""Embedded finance is definitely ramping up.""The last year has really confirmed our model and approach."

Peter Hazlehurst And Kris Hansen, co-founders Of Synctera, On BaaS In 2023

<ul><li>We are proposing and have started to see a bunch of banks thinking about having a fintech division or group.</li><li>We&#39;ve already signed seven in the six months we&#39;ve been in the market.</li><li>By getting seven banks up and running, hopefully by March/April timeframe, we&#39;ll be able to do seven to ten -- maybe fifteen -- fintechs a month at launch.</li></ul>

We are proposing and have started to see a bunch of banks thinking about having a fintech division or group.We&#39;ve already signed seven in the six months we&#39;ve been in the market.By getting seven banks up and running, hopefully by March/April timeframe, we&#39;ll be able to do seven to ten -- maybe fifteen -- fintechs a month at launch.

Peter Hazlehurst, co-founder And CEO Of Synctera, On Matchmaking Fintechs And Sponsor Banks

United States

Marketplace and API suite connecting fintechs with sponsor banks for compliant financial products

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Synctera (SYNCTERA US)

Charles Birnbaum, Partner At Bessemer Venture Partners, On The Five Waves Of Fintech

Sacra interview with Charles Birnbaum, partner at Bessemer Venture Partners.

Sacra

Chime At $1.5B/year

TL;DR: Chime hit $1.5B in annualized revenue in April 2024 with the unsexy business model of neobanking for low-income consumers. Now they're...

Sacra

Mercury: The Unbundling Of Silicon Valley Bank

TL;DR: As Silicon Valley Bank collapsed last week, $3B+ in funds flowed through the startup ecosystem to other startups, particularly neobanks...

Sacra

Peter Hazlehurst And Kris Hansen, co-founders Of Synctera, On BaaS In 2023

Sacra interview with Peter Hazlehurst and Kris Hansen, co-founders of banking-as-a-service platform Synctera.

Sacra

Peter Hazlehurst, co-founder And CEO Of Synctera, On Matchmaking Fintechs And Sponsor Banks

Sacra's interview with Peter Hazlehurst, co-founder and CEO of banking-as-a-service platform Synctera.

Sacra

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