Welcome back to The Interchange

Welcome back to The Interchange, where we take a look at the hottest fintech news of the previous week. We wish you and your families a very Happy New Year! If you want to receive The Interchange directly in your inbox every Sunday, head here to sign up! And just a heads-up that while the newsletter will continue moving forward, starting next week we’ll have a brand-new name and a different look. Stay tuned!

New funds

We started the year with news of a couple new venture funds that will be writing checks into fintech startups. First up, I scooped the news that former Anthemis Group partner Ruth Foxe Blader has started her own firm, Foxe Capital. Joining her in the new venture, which will also be exclusively fintech-focused, are former Anthemis investment associate Kyle Perez and former principal Sophie Winwood.

I had the pleasure of interviewing Ruth at TechCrunch Disrupt 2022 and was impressed with her knowledge and insights around venture capital. So it wasn’t a surprise that she wanted to branch out and invest independently.

What was a bit unusual about the move, though, is that she will still be investing on behalf of Anthemis, at least for the first year, essentially deploying the rest of the capital of the vehicle she was hired to manage in 2017. She’ll be compensated by Anthemis as a sub-adviser. Whether the firm will back her as an LP when she starts making new investments is unclear. While she didn’t say, I suspect she was bound by contractual obligations, so this arrangement worked around those.

London-based Anthemis has had its fair share of upheaval over the past year. Last April, TechCrunch broke the news that Anthemis had completed a restructuring that resulted in its letting go of 16 employees, or about 28% of its staff.

A spokesperson for the company at the time said the move was an effort “to better reflect current market conditions and to set up the business for future growth” against its “strategic priorities.” Sources familiar with internal happenings at the firm told me then that there was plenty of drama going on behind the scenes, including allegations of mismanagement on the part of the firm’s leaders and inflated salaries.

When asked if her departure had anything to do with what was going on internally at Anthemis, Blader told me: “My decision was based on my desire to try my hand at running my own firm, my personal ambition level and my love for working closely with founders.”

I also wrote about Exponent Founders Capital closing on its $75 million second fund. It was a fun story to write considering I’d been familiar with Charley Ma, one of the firm’s co-founders and managing partners, when he worked at Alloy and also while he was an angel investor. He and Mahdi Raza quietly co-founded Exponent in 2021 and invested in about 40 companies out of their first $50 million fund. It’s interesting that the two actually first met “on opposite sides of the negotiating table” while Ma was at Plaid and Raza at Robinhood. Both have experience as operators and angel investors. And like Ruth, Charley just seems like a nice person.

It’s also always interesting when alums from companies go on to start their own things. There’s been talk of a PayPal Mafia for years, but it seems there are a number of other such mafias, albeit on a smaller scale, made up of alums of other later-stage fintech companies becoming investors, too. — Mary Ann

You can hear Alex and Mary Ann talk about it all more on Friday’s episode of Equity.

Weekly News

Senior reporter Romain Dillet lays out some pros and cons of HSBC’s new international payments app Zing and how it compares to Wise and Revolut. Zing is currently limited to those in the United Kingdom. Among them, Romain writes about Zing’s different approach to foreign exchange fees. His overall take? “Migrants and frequent travelers will appreciate that there’s a new contender in the space.” Read more.

We are keeping our eye on the aftermath of the breakup between Synapse, its banking partner Evolve Bank & Trust and startup banking platform Mercury. Back in October, I reported on this after speaking with Synapse, which operates a platform enabling banks and fintech companies to easily develop financial services, and Evolve. This stemmed from allegations that included who was to blame for a deficit of customer funds. The latest is that Mercury is attempting to, among other things, recover some $30 million as part of a lawsuit filed against Synapse, as first reported by Fintech Business Weekly in December. The lawsuit was filed in the Superior Court of California for San Francisco County on December 13. In response, Synapse founder and CEO Sankaet Pathak called Mercury’s claims “meritless” in a lengthy Medium post on December 28. He also says that Mercury would rather “tarnish Synapse’s reputation rather than seek genuine legal recourse.” What’s next? I guess we’ll find out later this month. — Christine

Notably, Deel CEO and co-founder Alex Bouaziz posted on X last week that his company was opening 1,000+ roles this year. Of course, our first thought was, “Did Deel raise more capital?” I reached out to Alex to ask and he told me the company had not raised more funding but that it had been profitable since September 2022, adding: “Just a lot of new product and ambitious goals!” Meanwhile, VC Rex Salisbury posted on X in response, saying he knew “of several late stage cos doing 1k+ headcount expansion.” That’s crazy. — Mary Ann

Meanwhile, Mary Ann looked back at the biggest fintech hits and misses of 2023. Remember when Apple launched its savings account with a competitive rate? It set off a battle, of sorts, for fintechs to outdo the consumer tech giant. We also saw WeChat Pay and Alipay go cashless. And who can forget when Carta CEO Henry Ward called more attention to some bad news. There were also a number of acquisitions. What do you think was the biggest fintech story of the year? Hit us up in the comments or email us!

And Mary Ann joined with editors Brian Heater and Zack Whittaker to remember the startups we lost in 2023. Among the fintech companies were Braid, Daylight and ZestMoney.

Other items we are reading:

Forecast: 15 companies we think may actually, really, finally, maybe go public in 2024. Venture capitalists also anticipate more exits in 2024, as colleague Rebecca Szkutak reported for TechCrunch+. Here’s what they have to say.

Walmart adds Affirm’s buy now, pay later option to self-checkout. Catch up with Christine’s conversation with Affirm head of product Vishal Kapoor, where he discussed a new approach for the company’s continued innovation on buy now, pay later.

Baaskit launches in Chile with Financial Market Commission approval, introducing ‘banking as a service’ for enterprises using API technology

Neobanks vs legacy banks: Drawing the battle lines in 2024

Neobank Bunq rolls out customer-facing gen AI tool

Robinhood acquires Chartr as it expands media portfolio

FinTech IPO index soars 55% in 2023 as platforms notch triple-digit gains

Fundraising and M&A

As seen on TechCrunch

Peak XV-backed MobiKwik seeks to raise $84M in India IPO

ICYMI: Vestwell raises $125M to help businesses power workplace savings programs

Saudi shopping and BNPL platform Tamara tops $1B valuation in $340M Series C funding

Seen elsewhere

Crew raises $2.5 million pre-seed investment

Visa adds real-time money movement to Fintech Fast Track

Lennar acquires proptech Veev, which bombed after raising $600M. TechCrunch first reported on the company’s struggles here.

Podcasts

Mary Ann recorded a bunch of podcasts in December that you may have missed. Catch up here:

• 2023’s most compelling fintech stories
• The Equity crew predicts we’ll see fewer VCs in 2024
• Startup shutdowns and AI showdowns: The 2023 chronicles
• SVB, SBF and (more) OpenAI: The 2023 chronicles, pt. 2

And here’s an article about podcasts to listen to overall in 2024.