Largest fintech co. raises money, Silent Generation > Millennials

Lots of news happening over the last two weeks, the biggest of which may be a new funding round for the country’s most valuable fintech startup, validating one part of the market as others struggle.

Stripe, which provides a software platform for businesses to accept payments online, raised $150 million on a $9 billion valuation. At a time where flat rounds are the new up-round, this valuation represents a huge move from last year’s valuation of $5 billion. The round was led by Alphabet’s CapitalG arm (the-corporate-venture-fund-formerly-known-as-Google-Capital) and General Catalyst, while existing investors include a16z, Visa, Amex, Sequoia, and other top funds.

Founded only in 2011, Stripe has achieved massive scale and processes around $20 billion in payments annually, with an expected 40% growth rate. Customers include Lyft, Twitter, Tableau, Adidas, Best Buy, etc. It is estimated that roughly half of all online shoppers have used Stripe to make a payment. For the unfamiliar, here is a great overview and infographic covering the different aspects of Stripe’s business.

Given the scale of the business, Stripe is also taking steps to leverage its massive payments data to provide other valuable services. One new offering is Atlas, which helps businesses incorporate, obtain a bank account, and get set up on Stripe for payments, with help from Silicon Valley Bank, PwC, and others. Another product is Radar, which leverages their global payments network to identify and prevent fraudulent transactions. Here is a primer on how they are using machine learning for better fraud detection.

It was an okay day for the founders as well. The new valuation makes co-founder John Collison the youngest self-made billionaire at 26 years old (the other co-founder is Patrick Collison, John’s 28 year old brother and CEO). Each brother is estimated to own around 12% of the company.

A new unicorn is born
While unicorns have become more rare in the past few months, Opendoor just raised $210 million at a $1 billion (or more) valuation. Opendoor essentially acts as a CarMax for homes. Former PayPal exec Keith Rabois is one of the founders, and the company has already bought and sold over 4,000 houses, while charging 2-3% more than a traditional real estate broker would charge.

Another strategic deal for Fifth Third
As I reported back in September, Fifth Third Bank garnered some headlines as they invested $50MM into GreenSky, the third most valuable fintech company. They are at it again, this time leading a smaller, but still significant $18 million round into AvidXchange. The company provides a technology platform for companies (over 6,000 so far) to manage their Accounts Payable process.

Forget Millennials, it’s all about the Boomers (and the Silent Generation, but we don’t hear much from them…)
While much focus has been made on building technology solutions to get Millennials to invest, True Link Financial has built an investment advisory platform for retirees. In addition to basic wealth management services, they also provide trust services and a managed spending card for seniors, individuals with disabilities, and adult caregivers to help track and manage spending. They recently raised $3.6 million from investors, including the Ziegler Link-Age Longevity Fund.