Adyen is an underrated FinTech Giant. But that might change soon 👀; Klarna’s quest to compete with Google & Amazon 🥊; Some fail Fast while others go BIG - Bolt acquires Wyre for $1.5B 🤯

You're missing out... Weekly Recap 🔁

Good morning Everyone,

And happy Sunday! Another week passed, and it was again super hot in the financial technology space! Therefore, without further ado, let’s dive into the three stories that were moving headlines this week. 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 super interesting FinTech stories from this week:

Adyen is an underrated FinTech Giant. But that might change soon 👀

The news 🗞 When you think about online payments or payment processing, you usually think about Stripe, the $95 billion FinTech behemoth that is taking the world by storm. As of recently, you might have started to think about Checkout.com too, which earlier this year has hit a $40 billion valuation.

But there’s another payments heavyweight that is for some reason forgotten (at least for the general public), yet has been making tons of money, is profitable for years, and soon might become an even bigger force in FinTech. It’s the Dutch payments giant Adyen.

It has just announced its expansion beyond payments to build embedded financial products. And this is a huge move.

More on this 👉 These products will enable platforms and marketplaces to create tailored financial experiences for their users such as small business owners or individual sellers. The suite of products will allow platforms to unlock new revenue streams and increase user loyalty. Here’s what is known thus far:

• Starting with Adyen for Platforms, the company enabled platforms to embed payments into their offering and deliver a unified commerce experience across sales channels and geographies.

• Adyen then launched Issuing to improve this experience by enabling platforms to offer their users virtual and physical cards for business transactions and to directly receive funds faster. Going forward, Issuing will be included in a full suite of embedded financial products.

• Among the products that will be built out are multi-currency accounts, allowing users to receive payments, initiate payouts, and safely store money all in one place. These accounts will also enable platforms to facilitate the extension of financing to their users within the platform interface.

These and earlier launched solutions are all part of Adyen’s plans to dominate the world of payments, and maybe - the world of finance. Here’s the takeaway:

✈️ THE TAKEAWAY

One-stop-shop for other shops 🛍 At the core, Adyen’s embedded financial product play is aimed at platforms (and other digital businesses) that want to centralize their users’ financial needs in a single ecosystem. In other words, it wants to empower them to become a one-stop-shop for all their users’ needs. Think of it as if Facebook would start from scratch and would like to offer you checking accounts or digital wallets, payments, launch a marketplace again, etc. - so Adyen would be the tech & licensing stack that would power it all. It already does that for a number of well-known companies like Spotify, Booking.com, and Uber, among others. On the other hand, this move further puts Adyen as a one-stop shop for all things FinTech too. It earlier has put much more focus on unified commerce (launching an mPOS offering in the EU/UK/US, which lets merchants accept all major payment types (including contactless) and also offers an app management feature that lets merchants use third-party business apps), and now having the embedded financial products too, Adyen is very well positioned to supercharge its growth. Further. Despite having processed €516B in 2021 (up 70% year-on-year) and reporting €1B in net revenue (46% up year-on-year), Adyen stock is down circa 25% in the last 6 months. Not to mention the fact that it’s around 50% behind Stripe’s last valuation. Hence, it’s obvious that Adyen is clearly underrated. But solid foundations and new product launches will definitely change that soon. Keep an eye on them!

Klarna’s quest to compete with Google & Amazon 🤯

The finish line 🏁 BNPL heavyweight and Super App in the making Klarna has reportedly finalized the acquisition of the Nordic price comparison service PriceRunner.

Back in November 2021, the FinTech giant reportedly snagged PriceRunner for a whopping €930M. Klarna was said to pay 40% of the price in cash and the rest with Klarna shares.

The USP 🥊 PriceRunner was founded in 1999, and it operates across Sweden, Denmark, Norway, and the UK and compares over 3.4M products from 22,500 retailers in 25 countries. Up until 30 September 2021, PriceRunner had revenues of nearly £40M and is used by millions of customers each month.

What’s the endgame here? Well, ultimately Klarna wants to compete with Google & Amazon. Here’s the takeaway:

✈️ THE TAKEAWAY

The Google for Shopping 🛍 That’s what Klarna has next on its plate (if the current one isn’t big enough for them). PriceRunner further solidifies Klarna’s Super App with new features including price comparison and product reviews that will be available for its 147M customers worldwide. When you zoom out, it’s clear that Klarna is no longer a payments company only (which is already beyond just BNPL), and it’s clearly transitioning to become the Google for Shopping. This means helping people discover new products instead of just helping them buy them, with further strengthening their positions against leading marketplaces like Amazon or Facebook. I smell new funding coming soon to Klarna’s backyard… On, and they now are into Open Banking too 🚀

Some fail Fast while others go BIG - Bolt acquires Wyre for $1.5B 🤯

The scoop 💸 Payments decacorn Bolt (last valued at a whopping $11 billion) has acquired blockchain infrastructure provider Wyre for a reported $1.5 billion.

Given the reported price tag is true, this would make it one of the largest crypto acquisitions that did not involve a special purpose acquisition company (SPAC). Not too shabby!

The USPs 🥊 Founded in 2014, Bolt provides online retailers with a one-click checkout, authentication, payments, and fraud protection offering. In other words, it’s like Fast but with more sales. By the way, check out my latest on Fast in case you missed it:

Too fast, too luxurious: lessons from the failure of Stripe-backed Fast

Wyre was founded in 2013 and it offers several API solutions, including the ability to buy, sell, and hold cryptocurrencies, bank-supported crypto-to-fiat exchange, and crypto compliance services.

So what does this tell us? Well, first, when some fail - others go bigger. But there’s more to that, so here’s the takeaway:

✈️ THE TAKEAWAY

Standing out in a crowded market. First and foremost, this acquisition is part of the bigger trend we have been seeing in FinTech for quite some time now - traditional payments companies are increasingly adding crypto solutions and vice versa. The lines between crypto and TradFi are hence getting more and more blurred. Now, when it comes to Bolt, the Wyre buy simply means that crypto capabilities will be integrated into the one-click-checkout APIs. This is important because (a) it will enable Bolt merchants to accept crypto payments and hence make Bolt attractive for a bigger set of users, (b) the company said it will enable customers to purchase cryptos and NFTs via Bolt, hence, extending the company’s use cases beyond just one-click checkout, and (c) use Wyre’s tech stack to introduce to (probably crypto-first) offerings that would help drive merchant acquisition and diversify its business. Zooming out, this is all about diversification and differentiation in a highly competitive and crowded payments market. Even with Fast no longer on the market, Bolt still is left to compete with payment titans like PayPal, Apple Pay, Amazon Pay, etc. which all have strong adoption and huge market share.

🔎 What else I’m watching

• The size of the Metaverse 🤯 Citi published a research report indicating that the total addressable market (TAM) for the metaverse could reach $8 trillion to $10 trillion by 2030, spanning up to 5 billion users. Citi noted that in order to support this economy, major investments are required in storage, network infrastructure, consumer hardware, and game development platforms. The research team highlighted that the rise in sales of NFTs and big tech announcements have spurred greater interest in the metaverse theme over the course of 2021. Though virtual reality is the most popular method for accessing the metaverse today, Citi noted that the "metaverse is moving towards becoming the next generation of the Internet or Web 3."

• FinTechs finally threaten banks? 😮 JPMorgan’s CEO thinks so. Jamie Dimon, CEO of JPMorgan Chase, in his annual letter to shareholders, wrote: “The growing competition to banks from each other, shadow banks, FinTechs and large technology companies is intensifying and clearly contributing to the diminishing role of banks and public companies in the United States and the global financial system.” Drilling down into the competitive landscape between traditional financial institutions (FIs) and digital upstarts, Dimon said that non-banks — from payments companies and FinTechs to exchanges and Big Tech — are directly competing with banks and do so while operating outside the banking regulatory system. Read more here.

• eToro NTFs 🖼 Trading platform eToro has launched a $20M fund to purchase blue-chip NFTs – aiming to become “one of the leading NFT collectors in the world” beginning with a $20M investment. The brokerage also launched “e-Toro.art,” an NFT platform, and will dedicate $10M of its funds to emerging projects via a quasi-incubator program. 

💸 Following the Money

• Fintech Datanomik has raised a $6M seed round to advance its mission to bring financial data access to businesses across Latin America and emerging markets, according to latamfintech.co. 

• FTX.US has made an investment in national equities exchange IEX Group, as it looks to solidify its global digital asset market footprint. The size of the investment wasn’t disclosed and won’t be completed until May, but an FTX spokesperson told CoinDesk the company will become a “significant'' shareholder.

• Binance.US, the American franchise of Binance, said it has raised more than $200M in a seed round at a pre-money valuation of $4.5B.

👋 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:

P.S. This is a free and short issue that might not be published every week. Subscribe now and keep the FinTech pulse daily, make sense of what’s happening in the financial technology space every day and stay ahead. You will save at least 180 minutes. Every week!