Klarna further solidifies its Super App strategy 📲; Microsoft’s $70B Activision acquisition is all about the Metaverse 🕶; Twitter, Facebook, and Instagram all are jumping on the NFTs bandwagon 🚂
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Good day Everyone,
And happy Saturday! This week was especially hot, hence, I invite you to take a look at the three stories that were moving the headlines this week in the financial technology world. You can uncover other stories, keep the FinTech pulse daily and get at least X5 more by becoming a subscriber. Join the community here:
And here’s a mix of 3 really interesting FinTech stories from this week:
Klarna’s fresh acquisition to further solidify its Super App strategy 📲
The news 👀 Swedish-born yet global FinTech giant Klarna has just bought the securities company Dreams Securities from the savings app Dreams. The news was first revealed by Di.se , which refers to documents from the Swedish Companies Registration Office.
It is said that the deal should have been completed as early as October 15 and approved by authorities in early December. According to the newspaper, however, Klarna didn’t want to comment on their acquisition.
The USP 🥊 To put it short, Dreams is a securities business that offers investments in investment funds. Klarna savers can hence use the platform to put their money directly into different stock funds.
What does this tell us? Well, it’s clear that Klarna has some super serious ambitions for all things e-commerce and it definitely wants a bigger dent in the world of Super Apps. Here’s the takeaway👇🏼
✈️ THE TAKEAWAY
Dominating finance & e-commerce. For those of you who aren’t following Klarna closely, one can remember that the FinTech heavyweight has launched its actual Super App back in November 2021. It consolidates everything from shopping, payment management, price comparison (via SEK 9B Priceruner acquisition), and support for products to delivery, and returns. When it comes to finance, Klarna is already a bank in several countries offering checking and savings accounts, among IBANs and other things. Also, the BNPL giant recently launched Pay Now option globally so customers can pay in full wherever Klarna is accepted. It even has the Klarna Card which lets users pay in installments in-store & online. The Klarna Card integrates into the Klarna app and is connected with its loyalty program, Vibe. And soon all Klarna’s customers might be able to leverage investing, opening a completely different yet massive market opportunity. When zooming out, these developments as well as the recent Dreams acquisition further cements Klarna’s ambitions to dominate not only the e-commerce space but also become a proper Super App that’s tied to everyone’s daily life. Surprisingly, it might have all the components to make it a success.
Microsoft’s $70B Activision acquisition is all about the Metaverse 🕶
The deal💰 US tech giant Microsoft has announced its intention to acquire Activision Blizzard, a game development and interactive entertainment company.
Activision Blizzard makes hits like World of Warcraft and Candy Crush, and it will be bought for about $70 billion. 🤯 This is the largest all-cash acquisition in corporate history.
For the perspective, previously Microsoft’s biggest deal was its $26 billion LinkedIn buy. Shares of Activision spiked 26% yesterday, after slipping 27% since California regulators sued the company over employee harassment in July.
The impact & one but… 👉 If this acquisition goes through, Microsoft’s gaming business will become the 3rd largest in the world, being only after Tencent’sand Sony’s. Microsoft’s existing gaming biz (i.e. Xbox, Minecraft) brought in $15 billion last year, and its Xbox Game Pass monthly subscription now has 25 million subscribers. Expect this to grow significantly.
When it comes to but… It must be noted that antitrust scrutiny is more than expected here, and the regulators will sure express their opinion. Yet, Microsoft is reportedly so confident the deal will close, it’s agreed to pay a $3 billion cancellation fee if it falls through. Now that’s the level of confidence one should have!
But what does this mean for the bigger picture? It’s all about the Metaverse push. Here’s why👇🏼
✈️ THE TAKEAWAY
Metaverse, Metaverse, Metaverse. While many are only speaking, tech giants like Microsoft are executing and laying the grounds for their future (virtual) world domination. And it’s probably going to be about gaming as it might be crucial in monetizing the metaverse. Take this into account - sales across the gaming industry boomed nearly 30% during the lockdown in 2020 and continued growing last year. Gaming revenues are hence forecasted to jump from $180B in 2021 to $220B by 2024. That’s solid. Furthermore, it’s clear that Microsoft races strong rivals like Meta/Facebook & Nvidia to build the first widely used metaverse, and blockbuster games could hence help attract the skeptics. Platforms like Fortnite and Roblox have already built massive followings and in-game virtual economies, hence, the space is getting a bit more mature. Finally, CEO Satya Nadella himself said that Activision “will play a key role” in building metaverse platforms for 3B global gamers.
Twitter, Facebook, and Instagram all are jumping on the NFTs bandwagon 🚂
The news 🗞 NFTs is one of the hottest topics nowadays, and given how frequently it’s being discussed on various social mediums, it’s not surprising at all that some of the biggest names out there are jumping straight into.
Twitter. Twitter is introducing a new feature that will allow users to show off their NFTs, or non-fungible tokens — a way to certify digital assets stored on the blockchain. The company is rolling out NFT Profile Pictures to Twitter Blue subscribers on iOS by way of Twitter Blue’s early access Labs feature. Support for Android users and the web will follow. However, while only iOS users will have the ability to set their NFT as their profile picture, everyone on Twitter will be able to see the new hexa-shaped picture no matter what platform they’re currently using, Twiter says.
The Twitter Blue subscription service is not yet globally available, which will limit the adoption of NFT Profile Pictures to the early markets where the offering is now live — the U.S., Canada, Australia, and New Zealand.
FB & IG. Meta might be the next to hop on the NFT bandwagon. The Financial Times’ sources claim Meta is developing ways to create, display and sell NFTs on Facebook and Instagram. The company’s Novi wallet technology would power much of the “supporting functionality,” one tipster said. Instagram is reportedly testing a way to showcase NFTs, while Meta is also said to be discussing a marketplace that would help you buy or sell these digital collectibles. The company has already declined to comment.
✈️ THE TAKEAWAY
Following the trends (and money!). It must be noted that Twitter’s move here comes as no surprise, to be honest. This social media outlet had a growing interest in incorporating decentralized technologies into its platform for a while, which has included things like support for tips in Bitcoin and current developments in the payments space. Furthermore, Twitter last year experimented with minting its own NFTs, which it had offered for free. Now for Meta (=Facebook), it’s another thing, which also makes sense. Meta is probably thinking about a framework so that residents of its virtual worlds can sell unique digital goods. Who doesn’t want that, right? This could hence help Meta prevent third-party platforms like OpenSea’s market (which is growing like crazy!) from gaining too strong a hold if NFTs prove to be more than a short-lived trend. Finally, Meta is yet to win (if at all) in the traditional e-commerce space (dominated by Amazon, Shopify, and the likes), so it might be the next big and logical thing to capitalize on.
🔎 What else I’m watching
The SEPA of Africa 💸 The West African Monetary Zone (WAMZ) has launched the Pan-African Payments and Settlement System (PAPSS) on 13 January in Ghana. The new system allows a buyer in one African country to make payment in his or her national currency and the seller in another country receives payment in their local currency. Its commercial launch came after a successful pilot in the West African Monetary Zone (WAMZ) region. The WAMZ is a West-African economic and integration body with six countries, including Gambia, Ghana, Guinea, Liberia, Nigeria, and Sierra Leone. Expect more FinTech innovation in the continent in the next 2-3 years 🚀
OpenSea waves 🌊 OpenSea, the world’s biggest NFT marketplace, is on an acquisition spree. The company is buying Dharma Labs, a platform that allows users to connect their bank accounts in order to buy and swap tokens. The news means Dharma will close in 30 days, and users can no longer swap or purchase tokens. They're now being urged to transfer or sell the tokens in their wallets, with the company promising to pay any network fees. The NFT space is only going to get more interesting…
Wise numbers 📊 Wise has reported ballooning quarterly revenue growth, as it rallied after its stock was downgraded earlier this month. The money transfer giant (previously known as TransferWise) said in the third quarter revenues were up year-on-year by 34% and 13% quarter-on-quarter to £149.8M. The upbeat trading update comes after its shares tumbled by more than 10% earlier this month after Citi analysts downgraded Wise's stock over "excessive long-term growth expectations". In its update, Wise, which went public last year, said it expects overall revenue growth of 30% in 2022, compared to 2021.
💸 Following the Money
Koia, an app backed by the co-founders of Monzo and Freetrade that offers investors the chance to invest in alternative assets like wine and watches has bagged $1.4M in a funding round.
African gaming startup Carry1st raised $20M in a Series A funding round to build its own payments stack for its upcoming gaming marketplace.
NFL star Tom Brady's Autograph NFT platform raised $170M in a Series B round to expand its scope beyond sports to the music and film industries.
👋 That’s it for today! Thank you for reading and have a productive weekend! And if you enjoyed this newsletter, invite your friends and colleagues to sign up:
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