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Motive Insights - May 2022 Industry Roundup

May 29 · Issue #302 · View online
Motive Insights
Coming into the month of May one might have felt that the usual acceleration into the summer as we’ve seen in previous years has been somewhat slower, with global markets on the decline and the ‘R’ word (‘recession’, or ‘banana’ as David Rubenstein recalled this week) being used more frequently. That said, there was plenty of news in our ever-growing sector, and we’ve been looking forward to unpacking it for our readers.
 INVESTING (where the dollars are going)
While the public market cool-off has been felt all the way through to venture, heard this week on the streets of Davos at the World Economic Forum, was that one insulated area of financial technology has been infrastructure-like financial technology. Of course at Motive, as an infrastructure-focused financial technology investor, we’d agree with that, but the data is telling. This month saw some sizeable rounds close, including software-as-a-service billing platform, Paddle (based in London), raising $200 million from KKR, FTV Capital, Notion Capital and Silicon Valley Bank (SVB) providing debt. Embedded payments capabilities were clearly a theme of the month, again with SVB at the forefront, with the funding of Infinicept’s $23 million growth equity round. Cloud banking technology firm, Thought Machine, raised $160 million led by Temasek, valuing the platform at nearly $3 billion. Again, on the infrastructure theme, this month we saw Brazilian fintech company Dock raise $110 million in growth funding, to grow their full-stack payments and digital banking platform across South America, where demand for financial infrastructure can help boost inclusion. And finally, a company with an extraordinary capability that Motive Partners knows well, raised $109 million – TIFIN, an AI-powered platform for wealth-focused products redefining the industry – from Franklin Templeton, Hamilton Lane, JP Morgan and Motive’s management company.
 OPERATING (where the people are going)
In a world of inflation, and an increasing need for upskilled talent and continued innovation and investment in our sector, it’s hardly surprising the war for talent rages on. So, who’s moving where…? One that caught our attention was the announcement of Alibaba entrepreneur and executive, John Caplan, moving to commerce technology company Payoneer as co-CEO. Caplan’s track record of scaling companies in the digital economy as an investor, operator and innovator will be put to great use no doubt.
 One of Barclays’ leading executives, Ashok Vaswani (Chief Digital Officer) announced on his LinkedIn that he too will be stepping down to explore entrepreneurial opportunities – we look forward to finding out more about where Ashok heads next. And another industry veteran took an innovative path, with former Mastercard executive, Paul Stoddart, joining payments firm GoCardless as President. And it’s not just the veteran talent we keep an eye on, with young superstar Pranav Sood departing GoCardless to head up the EMEA division of Australian cross-border payments firm, Airwallex.
 INNOVATING (where the tech is playing)
It’s not just the public equities market that has provided excitement recently, but the digital asset environment had a dramatic turn of events in the past month, as we saw the controversial collapse of the Terra ecosystem. Likened to a potential Lehman Brothers moment for cryptocurrencies, the ‘algorithmic stablecoin’ underpinning the Terra ecosystem, “UST”, intended to have a fixed value of $1, and to provide a function similar to a bank in the sector by storing value and greasing the wheels of the crypto ecosystem, catastrophically lost its peg. So, what happened? In summary, the algorithmic balance between UST and the ecosystems native token, LUNA, designed to keep UST trading at a fixed price failed. The failure was driven by what many believe to be a coordinated attack on the protocol, where market participants liquidated positions in high volume and in a targeted fashion preventing the automatic stabilizers from taking effect. So, while the value of UST dropped, the other half of the Terra stablecoin, floating token Luna, also crashed disastrously, dropping form ~$85 a token to ~$0.0001 at the time of writing.
With so much loss of value and instability from what was perceived as a leading project in the digital assets segment, the adage ‘buy value, not hype’ must be ringing true for many.
Another hot topic of innovation that sits squarely between our crosshairs of private equity and financial technology, is the democratization of alternatives. Recent inflows of capital to the likes of iCapital Network, CAIS (a Motive portfolio company), and most recently Titanbay, with their capital raise this week led by Motive Partners (Motive Early Stage vehicle) and abrdn. As these platforms seek to distribute alternatives products with lower barriers to entry, the regulatory concerns around tokenization and education are pronounced. In summary, this is a whole new asset class being made accessible to the retail investor, and financial education about the products is essential, for advisors and buyers alike.
ESG continues to be an exciting and positive area of development – as efforts seek to make the world a better place, the unwinding of poor practices is not for the faint-hearted, and ease of innovation will be critical. Temenos, the cloud banking software platform has recently launched an investment platform that lets banks produce ESG services at a greater speed and scale, aiming to help banks and wealth managers meet the ever-growing demand for sustainable investing. Product director at Temenos, Alexandre Duret, explained that the platform “provides a fast track for our banking clients to launch innovative ESG investment products underpinned by robust, compliant processes, including new MiFID rules applicable in the EU from August 2022.”
  • Titanbay closes Series A funding round led by Motive Partners and abrdn. Titanbay, a private markets investment platform for sophisticated investors, has successfully closed a Series A funding round, led by Motive Partners and abrdn with participation from FNZ.
  • Earlier this month Motive Partners team spent time at the 25th Milken Institute Global Conference in Los Angeles, meeting with leaders from financial services, technology and the investment community. Motive’s Managing Partner, Rob Heyvaert, spoke on the mainstage about the new frontier in financial technology in a panel hosted by Motive portfolio company CEO, Matt Brown (CAIS). And Blythe Masters, Founding Partner, spent time unveiling the next big innovations in our sectors.
  • Alongside Franklin Templeton, Motive Partner’s management company joined previous strategic investors, including J.P. Morgan and Hamilton Lane, in the successful closing of $109 million in Series D financing for TIFIN, a data-driven wealth management platform. Rob Heyvaert, Founder and Managing Partner of Motive Partners will join the TIFIN board as part of the transaction. Access the full press release here.
  • Last week, Motive Partners sent a delegation to the World Economic Forum in Davos to spend time discussing some of the critical issues the world is faced with, from the war on Ukraine to the energy transition, and of course the role of financial technology in creating a better world. Our own Founder and Managing Partner, Rob Heyvaert spoke at the Infosys and WEF’s Global Future Council on Responsive Financial Systems event.
  • Additionally, our Founding Partner Blythe Masters joined the Montgomery Summit in Santa Monica, California as a keynote speaker and was interviewed by Michael Milken at the event. The Montgomery Summit is one of the United State’s premier technology conferences, which gathers entrepreneurs, investors and leading executives to discover the most important innovations in business, technology and the innovation economy.
Our new Motive Insights Podcast: The Future Delivered will debut in next month’s newsletter and proudly showcase a conversation between our own Founder and Managing Partner, Rob Heyvaert, and Adrian Durham, Founder and CEO of FNZ Group.
In the meantime, we invite you to explore our library of sessions from the first edition of Motive Insights – The Podcast on Spotify and Apple Podcasts. We are so excited for the next chapter of our podcast and invite you to tune in next month. 
The information contained in this newsletter is intended for discussion purposes only. It is not a recommendation, offer or a solicitation for the purchase or sale of a security or any services of Motive Partners. Motive Partners makes no representations or warranties as to the accuracy, reliability or completeness of any information provided and undertakes no obligation to update, amend or clarify any information in this newsletter. Any securities, transactions or holdings discussed may not represent investments made by Motive Partners, and it should not be assumed that any securities, transactions or holdings discussed were or will be profitable. This newsletter may contain forward looking statements that are based on beliefs, assumptions, current expectations, estimates and projections about the financial industry, the economy, Motive Partners or Motive Partners’ investments. Nothing in this newsletter should be construed or relied upon as investment, legal, accounting, tax or other professional advice or in connection with any offer or sale of securities.
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