![]() Chime also has indicated it will be ready for an IPO next year. In September, the company raised $485 million and the valuation was at $14.5 billion - making it one of the world’s most valuable fintech firms. According to a report from CNBC, Chime is attracting “hundreds of thousands of accounts a month” and is even EBITDA positive. So then how does Chime make money? The main approach is through fees from Visa (NYSE: V) on card transactions.īut going forward, there will likely be moves into other categories to boost monetization. That is, customers were able to get faster access to their $1,200 checks. The company has even leveraged this for direct payments that came from the federal government as part of the CARES Act. There are also special programs, such as to get paid up to two days early on direct deposits for payroll. Unlike traditional, brick-and-mortar banks, Chime accounts do not have fees for overdrafts or minimum balances. As a bonus, it also comes with access to more than 38,000 ATMs across the country. Founded in 2013, the company is a pure digital bank. But this hasn’t been a problem for those investing in startups of fintech operators. There has been much bearishness with bank stocks lately. Fintech stocks like Square (NYSE: SQ) have soared. But the current environment is definitely ideal for an offering. It’s similar to what Twilio (NYSE: TWLO) has down with its own business.Īlthough, it is not clear when Stripe will have its own IPO. ![]() To accomplish this, the company has developed a rich set of application programming interfaces that handle the complexities of payments.Īnother key part of the strategy for Stripe has been its grassroots building of a loyal community of developers. Stripe has made it extremely easy for companies to implement payments within their apps and websites. When the company raised capital last year, the valuation was at a stratospheric $35 billion! Interestingly enough, calling it a “unicorn” seems to understate its success and size. One of the leading unicorns in the payments category is Stripe. Why? There is a need for contactless payments. Moreover, there is a secular trend towards digital payments - and the Covid-19 pandemic has boosted this trend. The margins are generally high and the market size is enormous. When it comes to investing in startups, one of the hottest categories is the payments industry. The lead investor was NEA and the other investors that participated included Kleiner Perkins, SEEK Group, Learn Capital, SuRo Capital and G Squared. Coursera raised $130 million at a valuation of $2.5 billion. The latest funding for the company came during July. In other words, it would not be a surprise to see a public offering for Coursera within the next few years. Importantly, that company was sold for $3 billion in 2018. Prior to this, he was the founding CEO of Financial Engines, which he took public. In the summer of 2017, the company hired Jeff Maggioncalda as the CEO. Additionally, corporate clients like Procter & Gamble (NYSE: PG), Tata Communications and Novartis (NYSE: NVS) have used Coursera to educate their workforces. With Coursera, a student can get a full-on degree at a much cheaper cost than from a traditional university. ![]() Just about every educational institution has had to invest in developing an online platform. But of course, with the Covid-19 pandemic, it has been accelerated. But when the interest started to get intense, Koller and Ng decided to form a company - called Coursera - and raised capital. ![]() They wanted to leverage online videos from lectures at top universities.Īt first, the platform was not a business. Source: Postmodern Studio / Ī decade again, professors Daphne Koller and Andrew Ng were looking to use the internet to teach students. Here are seven ways to invest in startups that stand out: So then, as we get near the end of the year, what are some of the best startups to keep an eye on? Well, there are definitely many to choose from. They include such things as cloud computing, artificial intelligence, mobile, 5G, edge computing and so on. Next, there are a myriad of megatrends in technology. As a result, investors have been scrambling to find ways to boost their returns and find growth opportunities. One is that interest rates are at rock-bottom levels. After all, there has been an urgency for companies to use digital technologies to deal with remote working.īut there have been other factors that have propelled the growth. In fact, one of the catalysts for startup investing has been the pandemic. Venture capital firms were able to adapt quickly, such as by putting in place processes and systems to fund unicorn startups, like using technologies from Zoom (NASDAQ: ZM) and DocuSign (NASDAQ: DOCU). When the pandemic hit earlier in the year, there was much concern that investing in startups would slow down. ![]()
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