Welcome to TechCrunch Fintech!
This week, we’re exploring some of the latest and most controversial stories in the world of finance and technology. From Rippling’s controversial decision to ban certain former employees from selling their stock, to the massive valuation drop of Carta, to exciting new fintech raises focused on Gen Z, we’ll cover it all. Make sure to subscribe for a weekly roundup of the biggest and most important fintech news, delivered to your inbox every Tuesday at 7:00 a.m. PT.
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The Big Story
This week’s big news is the overwhelming demand for shares of the hot HR/fintech startup Rippling. The company has received over $2 billion in term sheets, and has even allowed former employees to participate in its giant tender offer sale. However, there is a catch – Rippling has banned former employees who work for a handful of competitors from selling their stock. This decision has caused quite a stir, with both supporters and opponents voicing their opinions on the matter.
“The news had people in a bit of an uproar on X, with some vehemently supporting – and some strongly denouncing – the move.”
– TechCrunch Venture Desk Editor, Julie Bort
Analysis of the Week
In other news, Carta, a once-high-flying Silicon Valley startup, is working on a secondary sale that would value the company at $2 billion. This is a massive drop in valuation, as Carta originally focused on cap table management software but gradually evolved into a “private stock market for companies.” Despite continued growth in its cap table business, the company also experienced a loss of $65 million in 2023, leading to a question about its potential for further growth.
“It’s becoming more and more rare to see companies hold on to their valuations, much less increase them.”
– TechCrunch EIC, Connie Loizos
Dollars and Cents
Amidst all the controversy, some fintech companies are still experiencing significant growth. Insurance provider Understory has seen a 500% year-over-year increase, and with the help of a fresh $15 million in funding, is now launching a product focused on the renewable energy sector. Torpago, a commercial credit card and spend management provider for community banks, has also secured $10 million in Series B funding on a valuation of $55 million. And in the world of cryptocurrency, stock-trading app Robinhood has acquired crypto exchange Bitstamp for $200 million in cash.
Another notable raise is Stake, which has raised $14 million to bring its fractional property investment platform to Saudi Arabia and Abu Dhabi.
New Fintech for Gen Z
The latest fintech company to make waves is Fizz, which offers a credit-building debit card aimed at Gen Z college students. This YC alum has raised $14.4 million in a seed round, led by Kleiner Perkins. To learn more about this deal and other exciting fintech news, tune in to the Equity crew’s discussion.
“It’s now become more than just hard work and a good team – now it’s about massive fundraising.”
– Maryann Akinboyewa, TechCrunch Reporter
What Else We’re Writing
In early 2022, the fintech startup Bloom became the first-ever startup from Sudan to participate in Y Combinator. After a pivot, a small fundraiser, and a rebrand to Elevate, the company is now open for general availability. And in an unexpected move, Capital One has teamed up with payment giants Stripe and Adyen to offer a free product aimed at fraud reduction.
High-Interest Headlines
- US Bank partners with Greenlight on teen bank accounts
- Bunq, the $1.8 billion European neobank, expands into the UK
- The Brex boys confront their company’s financial struggles
- Priceline and Ramp team up to disrupt business travel booking
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