Klarna makes deeper cuts and now counts ~1000 people laid off in 2022 ๐; The platformization of financial technology ๐; FTX acquires Voyager Digital for basically $0 ๐ค
You're missing out big time... Weekly Recap ๐
๐ Hey,ย Linas here!ย Welcome back to a ๐ weekly free editionย ๐ of my daily newsletter. Each day I focus on 3 stories that are making a difference in the financial technology space. Coupled with things worth watching & most important money movements, itโs the only newsletter you need for all things when Finance meets Tech.
If youโre not a subscriber, hereโs what you missed this week:
The Future of Finance is Integrated: Mollie launches Mollie Capital ๐ธ
Apple's latest move into NFTs could be a game changer for Web3 ๐คฏ
Square + Apple, or the Beginning of the End of Physical Payment Terminals ๐ฒ
Banks are becoming crypto companies while crypto companies are becoming banks โฟ๐ฆ
Samsung is taking a page out of Apple's playbook and launching a credit card idia ๐ณ
Shopify is a FinTech company that you should be paying attention to ๐
JPMorgan's push into co-branded cards, & why it can be huge ๐ณ
and more!
As for today, here are the 3 FinTech stories that were making a huge difference this week. It undoubtedly was the most interesting week in the space this month so far, so definitely check out all the above stories.
Klarna makes deeper cuts and now counts ~1000 people laid off in 2022 ๐
Cut, cut, cut ๐ฌ Swedish BNPL giant Klarna is going to do layoffs. Again.
More on this ๐ According to Sifted, the 17-year-old company told employees in a video message from COO Camilla Giesecke that Klarna is reducing staff again to โreflectโ its new and โmore focused nature.โย
Around 500 Klarna employees were invited to watch Giesecke deliver the news, including in IT and recruiting, though Klarna tells us in a separate statement that the job cuts will impact fewer than 100 employees globally.
Once Europeโs most valuable startup, Klarna employed 7,000 people at the beginning of this year, now it has โaround 6,000โ employees.
โ๏ธ THE TAKEAWAY
Anti-example ๐ They say if youโre going to cut, cut deeply so you only have to do it once. It seems that most companies are ignoring this wisdom, with Klarna in particular as the new cuts come just 3 weeks after CEO Sebastian Siemiatkowski told Bloomberg that the company was done making layoffs. Ouch! ๐ฌ Zooming out, itโs clear that Klarna is currently experiencing one of the worst momentum in its entire existence. In May, the company shrunk its global workforce by 10%; it also raised funds at a $6.7B valuation in an $800M round, down from the somewhat aspirational $45.6B valuation that Klarna was assigned by SoftBank. Itโs getting more and more clear that 2023 will be a critical year for Klarna - it will either break or make the BNPL giant.
More on Klarna:
As Klarna's losses quadruple, 2023 will make or break once BNPLโs top star ๐ต
Klarnageddon begins as Klarna will lose 85% of its valuation with the fresh funding ๐คฏ
Will becoming a Super App save Klarna? ๐ค
1000+ FinTech, Tech & Crypto Talent Ready to Grow Your Business ๐
The platformization of financial technology ๐
The role ๐ผ Commerce technology company Payoneer PAYO 0.00%โ has hired Assaf Ronen, a veteran of SoFi, Amazon, and Microsoft, to lead a newly established division that integrates Payoneerโs technology, product, and high-value service units.
Ronen has become the companyโs first chief platform officer and will head its new platform division.
More on this ๐ As head of the new platform division, Ronen will lead it in its mission of expanding Payoneerโs high-value service offerings โ including B2B accounts payable (AP) and accounts receivable (AR), working capital, and merchant services โ and enhancing and building new financial products.
The company reported that B2B payables and receivables grew 66% during the most recent quarter, driven by increased use of the virtual Payoneer Commercial Mastercard and improvement in cross-border travel.
โ๏ธ THE TAKEAWAY
Why does this matter? ๐ค This news from Payoneer is a very clear signal that weโre seeing a strong trend towards platformization of FinTech. In other words, more and more FinTechs are evolving to become platforms and ecosystems. And when you think about it, itโs probably the most promising and solid long-term strategy to win big. Stripe, Affirm, Block/Square (probably the strongest one out there) and now Payoneer are all moving there. What about you?
Affirm + Stripe shows why ecosystems are crucial in FinTech ๐ธ
PayPal's biggest threat is coming from around the Block & it's called Cash Pay ๐ณ
FTX acquires Voyager Digital for basically $0 ๐ค
The prize ๐ค Crypto exchange giant FTX has won the auction for the assets of bankrupt crypto lender Voyager Digital with a bid worth just over 1.42 billion.
More on this ๐ The winning bid includes about $1.31B for the fair market value of Voyager's digital assets and an additional consideration estimated as providing approximately $111M of incremental value.
Voyager says that FTX US's trading platform will enable customers to trade and store cryptocurrency after the conclusion of the company's chapter 11 cases. The deal will be presented to a US bankruptcy court next month and the sale of the assets is still dependent on a vote by creditors.
โ๏ธ THE TAKEAWAY
Thatโs a steal! ๐คฏ Letโs do a quick refresh first. Voyager filed for Chapter 11 bankruptcy protection in July, listing assets of between $1B and $10B and liabilities in the same range. This occurred because the company suffered a blow when Three Arrows Capital went bust a week earlier, defaulting on a loan of 15,250 BTC and $350M USDC. When it comes to the deal itself, itโs a real steal. FTX got Voyager basically for free by paying $1.4B for $1.3B in crypto assets + $111MM thrown in to save them the embarrassment. Thatโs how you do business these days ๐ The best thing? Rumor has it that Celsius might be nextโฆ Which again brings us to this:
Reread: FTX is Cryptoโs Berkshire Hathaway while its CEO is the new J.P. Morgan ๐ฉ
๐ What else Iโm watching
The lows of lows ๐ฌ The Grayscale Bitcoin Trust (GBTC), which has been trading at a discount since the beginning of 2021, hit a record low last week. GBTC's discount fell to -35.26% โ its lowest point ever, according to The Block's Data Dashboard. This means the market price of GBTC shares is over 35% lower than its net asset value or NAV. Grayscaleโs bid to convert its product into a spot ETF was rejected based on the regulator's conclusion that the company hadnโt shown sufficient planning to prevent fraud and manipulation. Grayscale later filed a lawsuit against the SEC after the decision.ย Crypto winter is realโฆ
Bitcoin is greener than you think ๐ A Cambridge Centre for Alternative Finance (CCAF) report recently found that bitcoin mining accounted for roughly 48.35 million tons of carbon dioxide annually (0.1% of global greenhouse gas emissions), which isย -14.1%ย lower than its estimates in 2021. The report based its estimates on the geographical distribution of bitcoin mining in January 2022. CCAF combined itsย most recent dataย with public information on the electricity generation methods in different regions. The institute estimated that 37.6% of the energy the industry uses comes from sustainable sources, down from the 59.5% figure that the Bitcoin Mining Councilย reportedย for 2Q 2022 (which means that the numbers could be even better). Notably, the figures don't capture "activities that might be expected to reduce emissions," like the use of flare gas, the energy produced behind the meter, and waste heat recovery, due to a lack of data. All in all, it seems that BTC is greener than most people thinkโฆ ๐คทโโ๏ธ
๐ธ Following the Money
Two Revolut alumni bag $3M for new startup.ย Tilt is a shopping app designed like a social media app โ think the love child of Instagram, TikTok, Depop, and a flurry of Chinese livestream shopping channels.
Aviva has invested $10M in a VC fund that backs female entrepreneurs in the fintech industry across the UK, Europe, Canada, and the US. Founded in September 2019, the Anthemis Female Innovators Lab Fund is anchored and co-founded by Barclays.
German venture capital firm Point Nine, which backs companies including Delivery Hero, Revolut, and Typeform, has raised โฌ180M in a new seed fund to support business-to-business (B2B) marketplaces and software-as-a-service (SaaS) startups.
๐ Thatโs it for today! Thank you for reading and have a relaxing Sunday! And if you enjoyed this newsletter,ย invite your friends and colleagues to sign up: