Welcome to TechCrunch FinTech! This week, we're taking a look at two fintech companies serving underserved populations, and more.
Get TechCrunch's roundup of the biggest and most important fintech stories delivered to your inbox every Sunday at 7:00 a.m. PT. Subscribe here.
big story
PayJoy is an example of a company with positive unit economics and a mission to help the underprivileged. You don't often see these two intersect, so it's very exciting when they do. Last year, I wrote about the company's milestones of reaching $300 million in annual revenue and profitability and raising $150 million in Series C funding. The company's model is unique. Help people build trust through pay-as-you-go financing for smartphones. Once the mobile phone payment is completed, the customer can apply for a loan through her PayJoy using their device as collateral. Click here to learn about its growth.
This week's analysis
Petal is another fintech company that aims to help underserved populations “build credit, not debt.” Last May, TechCrunch wrote about the company's $35 million raise and plans to spin off its data division. Empower Finance announced plans to buy Petal last week, but Fortune magazine said Petal began looking for a buyer last year “when cash was tight.” A Petal spokesperson told me via email. “Like Petal, Empower uses cash flow underwriting for its suite of credit products. … The acquisition of Petal will soon result in a suite of credit cards to complement its services.” In 2024. Will there be more M&A? I'd love to see.
dollars and cents
TransferGo, a UK-based fintech company best known as a consumer platform for global money transfers, raises $10 million in growth funding from Taiwan-based investor Taiwania Capital as it aims to expand in Asia Pacific. Raised a round. The last time it raised $50 million in a Series C funding round was in 2021. TransferGo claims that its growth, combined with new investments, will double its valuation.
what else are you writing?
Brazilian startup Salvy, an enterprise mobile carrier, is the only Latin American-based company in Y Combinator's latest batch, the accelerator confirmed to TechCrunch's Anna Heim. This is a significant decrease compared to cohorts that have not only been remote during COVID-19 but have also gone through the accelerator in more recent classes. For example, her winter 2022 batch of Y Combinator included her 33 Latin American companies. Could the state of the fintech sector as a whole be partially to blame? Historically, about a third of the 231 Latin American companies that passed through YC were focused on fintech. And with funding for fintech on the decline, this could perhaps partly explain YC's lack of interest in Latin America.
Interesting headlines
Investors focus on 'most hated' fintech and e-commerce sectors
Stride and Utah set new precedent for benefits for independent workers
US startup Parafin acquires $125 million warehouse facility from SVB and Trinity Capital
Tabs secures $7M in seed funding to power AI-driven accounts receivable platform
UAE fintech Fortis secures $20 million in Series A round
Anroc achieved a $250 million valuation with a mundane idea: calculation.
Want to provide a tip? Email maryann@techcrunch.com or text Signal 408.204.3036. You can also send a note to all TechCrunch staff to tips@techcrunch.com. For more secure communications, click here to contact us. This includes links to SecureDrop (instructions here) and encrypted messaging apps.