The Main Edition - Exits & Deep Reads

Japan's Mizuho goes shopping for fintech (TWIF 10/6)

Essaouira, Morocco

Hello Fintech Friends,

Read on for a surprisingly high volume of Japanese fintech M&A this week.

Also - our friends at Cascading AI* are hiring two engineers to build AGI for banking!

And we'll be at SF Tech Week next week, drop by and say hi:

Please find another week of fintech exits and deep reads below.

(👍👎 Have feedback for us? Let us know!)

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📖 Reads of the Week

Fulfilling Crypto’s Original Promise by @ttunguz

Visa announced their plans to launch a stablecoin with BBVA today. Throughout the quietness in crypto created by the wake of the FTX collapse & the AI boom, stablecoins have become a large & very fast growing part of web3. Users clock 3m stablecoin transactions per day at an approximate average value of $5,000. But, the use of stablecoins extends far beyond crypto trading. Stablecoins own more US Treasuries than South Korea & Germany & have become an important buyer of US goverment debt.

☯️ Exits

💻 IPOs & SPACs

PicPay, a Brazilian neobank and rival to Nubank, says that it will IPO in New York in 2025. The company 2x'ed its net income for the first half of 2024 to $11.3 million.

🤝 M&A - Fintech

Card network Mastercard announced its acquisition of Minna, a subscription management software provider, to build a dashboard that can help all of its customers manage their subscriptions in one place.
British personal investing app Freetrade, a Robinhood rival with 1.4 million users, acquired the UK arm of Australian investing rival Stake. Meanwhile, private equity firm Hg is considering a sale of SmartTrade, the French personal investing app it acquired in 2020, for around €1 billion.
Californian private equity firm Ridgeview Partners will acquire mobile-payment software company PayRange.
Working capital fintech Settle announced its acquisition of inventory management platform Turbine.
Payment tech provider Stax acquired payment gateway BlockChyp.
Personal finance app Douugh agreed to acquire B2B fintech software provider Radical DBX.
$25 billion payment giant Global Payments, which has acquired 40+ companies since 2001, is stepping back from M&A as a strategy.

🏦 M&A - Bank and FinServ

Japanese financial services giant Mizuho acquired a minority stake around 5% in private credit advisory group Golub in order to pitch its investments in Japan, and is set to acquire a stake in card data and rewards platform Rakuten.
Meanwhile, the Japanese ownership company of American retailer 7-Eleven is looking to sell off its stake in financing arm Seven Bank, of which it now owns 46%, a stake worth about ¥153 billion ($1 billion).
Buyout firm TPG bought a minority stake in Atlanta wealth manager Homrich Berg and is in the running to buy a $2 billion stake in financial advisor Creative Planning at a $15 billion valuation.
Private equity firm Mavik Capital took equipment financing provider XS Financial private.

The credit card rewards game is played by rich and middle-class Americans at the expense of low-income Americans, who continue to rely on cash and debit cards. https://t.co/Bd9lUCrWE8 pic.twitter.com/REM5idOC9H
— John Paul Koning (@jp_koning) September 30, 2024

One of the most common fintech myths: if you get a bank charter, you will "trade (poorly) like a bank."

Just this weekend, I received this DM about Nubank. How the heck does it trade so high?

Nubank is at 10x P/B. Amex is at 6x. Just because you have a bank charter doesn't… pic.twitter.com/T959xetWJw
— Alex Immerman (@aleximm) October 1, 2024

lot of fintech feels zero sum - there are countless card & bill pay companies taking from one another.

but 37% US payments remain cash and checks - greenfield still exists, and the denominator is growing. pic.twitter.com/flfOutxoWz
— Alex Immerman (@aleximm) October 2, 2024

To evade sanctions, Russia has been routing import payments to China via Kyrgyz banks. Inspired by a recent U.S. visit, a new Kyrgyz law makes this (up to 60%) more costly by requiring imported goods to actually enter Kyrgyzstan before going to Russia.

👀 pic.twitter.com/MyLXeqhNdg
— John Paul Koning (@jp_koning) October 3, 2024