Published:
Mar 20, 2023
Author:
Cindy Grazer
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In the past, heightened use of credit cards has been a sign of financial stress. But Gen Z-er’s are feeling no stress - financial or otherwise. After an unprecedented past few years, these bright-eyed entrants into the workforce have benefited from a confluence of events: a pandemic to hone in spending, followed by a tight job market and inflation driving up entry level salaries.
And what is this lucky generation focused on with their extra savings, you might ask? Living comfortably. A survey conducted by Intuit found that members of Gen Z would choose a better quality of life now, rather than money in the bank for later. According to data from Visa, Gen Z is the only generation that has steadily spent more than they did YoY for the past two and a half years.
Although we can all form our own opinions on where a new Tesla or T-Swift concert lands on our list of priorities, in typical Gen Z fashion, they’re not choosing these luxuries at the expense of their 401(k)’s. They’re finding a way to earn more and have it all. The Bank of America Institute reported that Gen Z-er’s are so motivated to be at ease financially that three out of four have considered channels to earn additional income, such as a second job.
So, is it a case of everything everywhere all at once that is driving these lucky brats or a commitment to living their best lives before the best quote from Breakfast Club (1985) kicks in…“When you grow up, your heart dies”.
Portfolio News
Paymentology powers Fondeadora to launch Apple Pay in Mexico - The companies will be among the first to bring Apple Pay to digital banking customers in Mexico. As part of a new collaboration, Fondeadora is leveraging Paymentology’s cloud-based digital payment platform to deliver a seamless payment experience to its customers. By doing so, Fondeadora can offer faster transaction processing, advanced security measures, and enhanced data analytics. Read more
UAE-based startup Qlub raises $25m in latest funding round - Congratulations to portfolio company Qlub on the announcement of their most recent fundraise. The new round was co-led by Cherry Ventures and Point Nine with participation from other global venture capital firms, including STV, Raed Ventures, Heartcore, Shorooq Partners, FinTech Collective, and several angel investors. The startup plans to use the proceeds to fuel growth as well as develop and launch new services for restaurants and customers who already use Qlub, it added. Read more
Flutterwave secures two additional licenses in Rwanda: Electronic Money Issuer & Remittance licenses - These new licenses enable Flutterwave to strengthen its operations in East Africa. In addition to being a Payment Service Provider, Flutterwave will now be able to offer money deposit and withdrawal, electronic funds transfer, as well as inbound and outbound remittance services to the 13.46m people living and working in Rwanda. Read more
How Centrifuge is making DeFi impactful with real-world assets - DeFi platform Centrifuge is unlocking "affordable access to capital" with Real-World Assets, helping small businesses access DeFi liquidity. Centrifuge launched in 2017 and has financed a total of $317m in assets on its marketplace—making it a leader in this nascent sector. With an infinite variety of illiquid assets—from real estate to carbon credits and natural resources—all ripe for tokenization, the sector is predicted to become a $16t market by 2030, according to a recent report by the Boston Consulting Group. Read more
MoneyLion reports record Q4 and FY 2022 results, reached significant profitability milestone exiting 2022 - MoneyLion delivered record Adjusted Revenue of $92m and improved Adjusted EBITDA to ($6)m in the fourth quarter. Full year 2022 Adjusted Revenue grew 99% year-over-year to $328m, which was at the high end of their range, and Adjusted EBITDA was ($63)m, which was a beat versus guidance of ($65) to ($70)m. For the full year 2023, they expect positive Adjusted EBITDA, reflecting their continued focus on reaching sustained profitability at scale. Read more
IMMO hires former WeWork and Alfred top executive Arik Benzino as CCO - Benzino joins IMMO with 25 years of international entrepreneurial experience, marking this move as one of the company's most senior executive appointments to date. He comes from Alfred, North America's leading resident experience company. Read more
Everything Everywhere All At Once
Gen Z spending gets supercharged by inflation and wage growth - Most people enter adulthood feeling broke and spending frugally. Not Gen Z. Spending by the youngest group of US adults has been turbocharged by two once-in-a-generation drivers over the past year: decades-high inflation and a tight job market that has propelled strong wage growth, especially at entry levels. A boost in savings from forced inactivity at the height of the pandemic also helped. Read more
Industry News
Eleven banks deposit $30b in First Republic Bank - The bank’s executives came together in recent days to formulate the plan, discussing it with Treasury Secretary Janet Yellen and other officials and regulators in Washington, D.C. JPMorgan Chase, Citigroup, Bank of America and Wells Fargo are each making a $5b uninsured deposit into First Republic, the banks said in a statement. Morgan Stanley and Goldman Sachs are kicking in $2.5b apiece, while five other banks are contributing $1b each. Read more
OpenAI partners with payment firm Stripe to monetize ChatGPT - The firm, which launched the latest version of its technology named GPT-4 this week, said Stripe will provide billing and checkout features for payments, as well as its automation and tax compliance technology. Stripe will take a small percentage of the transactions that go through its platforms. Read more
Payments giant Stripe raises $6.5b at a $50b valuation - New investors in the round included GIC, Goldman Sachs Asset and Wealth Management and Temasek, and return backers included Andreessen Horowitz, Baillie Gifford, Founders Fund, General Catalyst, MSD Partners and Thrive Capital. All proceeds will be used to help Stripe employees cover tax obligations related to the pending expiration of restricted stock units, plus to fund a new stock tender offer for current and former employees. Read more
Swiss central bank offers Credit Suisse liquidity backstop - Credit Suisse executives held talks with representatives from the SNB and Finma on Wednesday afternoon after the bank’s equity and bonds plunged in value following the failure of three US banks last week. The steep share price decline came after the chair of the Saudi National Bank, which bought a 10% stake in Credit Suisse last year, ruled out providing the Swiss lender with any more financial assistance. Read more
Asset managers warn too much choice is confusing retail investors - The number of investment products has proliferated to the point that they are confusing retail investors, top asset management executives have warned. The asset management industry rushed to diversify its offerings in response to customer appetite for low-cost mutual funds and ETFs as well as less traditional alternative investments such as real estate and private credit. Read more
Fed to consider tougher rules for midsize banks after SVB, Signature failures - A raft of tougher capital and liquidity requirements are under review, as well as steps to beef up annual “stress tests” that assess banks’ ability to weather a hypothetical recession, according to a person familiar with the latest thinking among U.S. regulators. The rules could target firms with between $100b to $250b in assets, which at present escape some of the toughest requirements. Read more
Morgan Stanley is testing OpenAI’s chatbot that sometimes ‘hallucinates’ to see if it can help financial advisors - The tool will use the technology’s latest version, GPT-4, which launched this week. It’s currently being tested with 300 advisors, and when released more broadly, will aid all of Morgan Stanley’s 16,000 advisors. The bank’s use of GPT-4 will be intended to assist human advisors, much like a research assistant would. But it’s not supposed to replace human advisors, who are still needed to interact with clients. Read more
Meta will end support for NFTs on Instagram, Facebook - Stephane Kasriel, Meta’s head of commerce and financial services, wrote in a Twitter thread on Monday that the shutdown will allow the company “to focus on other ways to support creators, people, and businesses.” Kasriel specified that Meta won’t give up on its mission to help creators connect with their fans, and will pivot focus on other products such as Reels for messaging and monetization. Read more
Select Financings
Aeqium - San Francisco based compensation management platform raised $5.8m in Seed funding led by Vestigo Ventures and Ridge Ventures. Read more
Apexx Global - London based payments orchestration platform raised $25m in Series B funding led by MMC Ventures. Read more
Broom - Indonesia based auto-financing startup raised $10m in Seed funding led by Openspace Ventures. Read more
CNHC Group - Hong Kong based issuer of the CNHC stablecoin raised $10m in new funding led by KuCoin Ventures. Read more
Fairmatic - San Francisco based commercial auto insurtech startup raised $46m in new funding led by Battery Ventures. Read more
Parker - San Francisco based corporate credit card startup for e-commerce businesses raised $37m in new funding led by Valar Ventures. Read more
Payabli - Miami based payments infrastructure firm focused on vertical SaaS platforms raised $8m in new funding led by TTV Capital. Read more
PhonePe - India based payments and financial services firm raised $200m in growth funding from Walmart. Read more
Smooth Labs - Singapore based blockchain infrastructure startup raised $2m in Seed funding led by NGC Ventures. Read more
Soul Wallet - Santa Monica based self-custodial crypto wallet maker raised $3.1m in Seed funding led by Struck Crypto. Read more
Tilia - US based payments firm focused on serving metaverse projects and digital world platforms raised $22m in new funding led by JPMorgan. Read more
Tweed - New York and Tel Aviv based wallet and payment solution platform raised $4m in Seed funding led by Accel. Read more
Wingspan - New York based payroll platform for managing freelancers raised $14m in Series A funding led by Andreessen Horowitz. Read more
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