Finance

London’s top VCs pick fintech’s rising Class of 2021

Fintech firms have had a soaring start to 2021, raising a record $5.3bn from venture capital investors in the first six months of the year.

London has also had a stellar turnout, with investment in startups based in the English capital accounting for over a third of all European fintech funding. London also ranked as the top European city for fintech investment, and beat New York to come second globally behind San Francisco.

In November last year, Financial News asked some of London’s top venture capital investors to name some of the hottest fintech startups in the city still flying under the radar.

READ London’s top VCs name the hottest fintech startups you’ve never heard of

Following record investment numbers, we turned to a new batch of VCs to discover fintech’s Class of 2021.

John Doran, general partner at TCV
Mollie
By putting the needs and priorities of merchants at the centre of everything it does, Mollie provides superior payment solutions, excellent customer support and transparent pricing to help its growing ecosystem unlock revenue growth and drive scale. Given the highly fragmented nature of European payments, Mollie is a business with tremendous long-term growth prospects.

We had been tracking Mollie for some time and believe it has built a product that is frictionless, highly developer-friendly and ultra-localised, resulting in an offering that resonates strongly with merchants, catapulting it to become a leading European e-commerce payments provider. TCV typically invests in category leading technology companies that are disrupting large markets, which is exactly what Mollie is all about.

READ Blackstone backs Stripe rival Mollie with €665m fundraise

TCV is one of the world’s largest venture capital firms, investing from offices in Silicon Valley, London and New York. Since its inception in 1995, it has raised over $19bn across 11 funds and invested over $15bn in technology companies including Airbnb, Netflix, Facebook, Klarna and Revolut.

Evgenia Plotnikova, partner at Dawn Capital
Soldo
European pay and spend automation platform Soldo is a standout fintech. Having worked with Soldo’s team for the last two years, I’m in no doubt that it is a company with the people, technology and market opportunity to be a global success story. Its accomplishments to date are a testament to its founder Carlo and the first-rate team he has built around him.

As a single, end-to-end platform, it immediately simplifies the confusion of separate budgets, corporate credit cards, manual expense reports and trackers that are the messy reality of spend management for too many small and medium-sized businesses. Its compelling strategy and market-changing mission to help businesses manage and control spending more efficiently is immediately impressive, and as users of Soldo, I know how transformational it has been for our business and finance team.

Having just closed its $180m series C — a European record for the spend management category, which we took part in — Soldo has a brilliant roster of new investors joining the journey, and we can’t wait to see where it goes next from here.

Dawn Capital is a Europe-focused specialist B2B software fund, with assets under management of $1.5bn. It backs early-stage companies at series A and B, and continues to fund top performers through to exit. Its roster of investments includes iZettle, Tink and Mimecast.

Julian Rowe, general partner at Latitude, a sister fund of LocalGlobe
Tillit
We get excited when we find markets as vast and mission critical to all participants as the business-to-business online payment opportunity. We get even more excited when we find teams of the calibre of the Tillit founding team who have lived and breathed the issues themselves, bringing a deep understanding of the opportunity and determination to drive change.

Tillit offers business shoppers instant checkout based on real time credit decisions, as well as automated invoicing, flexible payment terms and expenses management to make it easier for employees to make purchases for their business. Meanwhile, for merchants, Tillit has been proven to dramatically increase conversion rates, reduce the overheads of managing online payments and improve cash flows, all while merchants bear zero credit risk.

Tillit was founded in Norway and is now building a substantial presence in London, following the opening of its UK office. It is already working with some of Europe’s largest merchants and we’re hugely optimistic about Tillit’s potential to transform the business-to-business online commerce landscape.

READ VCs warn City funds that stance on tech IPOs is ‘catastrophic miss’ for London

Latitude is the sister fund to LocalGlobe, a London-based venture capital firm founded by early Skype executive Saul Klein and his father Robin. LocalGlobe invests at pre-seed and seed stages, and has backed the likes of Robinhood, Wise and Zoopla. Latitude is focused on series B stages and onwards, picking up LocalGlobe portfolio companies and new startups for further investment, including Tessian, Zego and Tide.

Maria Wagner, investment director at Beringea
AccessPay
Corporate payments are not the sexy side of fintech. And yet, managing and moving money remains a painful headache for enterprises, and digital solutions present a vast opportunity for growth.

Enter AccessPay. The Manchester-based scaleup that Beringea first backed in 2019 provides a cloud-based payments platform that securely connects corporate enterprise resource planning systems with more than 16,000 global banks. This enables businesses to automate batch payments, such as payroll, and cut out hours that corporate treasury teams previously spent inputting data and translating it into the format required by individual banks.

The team is led by Anish Kapoor, a serial entrepreneur whose first business TeleCity scaled to be Europe’s largest data centre operator and saw him become one of the youngest serving FTSE 250 directors. Under his leadership, the business is expanding internationally and scaling its platform, so this is a company with a lot of room to grow.

Beringea is a transatlantic patient capital investor, typically making an initial investment in UK companies of between £1-10m and leading series A or series B rounds. Its portfolio includes luxury brand Monica Vinader, e-sports firm Fnatic and trading solutions provider Celoxica. 

Dan Chaplin, principal at Dawn Capital
Copper
The demand for London-based digital asset infrastructure provider Copper’s proposition has been relentless, driving a 40x growth in assets under custody since Q3 2020, across more than 200 institutional clients. Alan Howard, founder of Brevan Howard, recently invested in Copper in an extension to its latest round, re-emphasising the speed at which the traditional financial world is quickly merging with the digital assets market.

Put simply, Copper and its founder Dmitry Tokarev are setting out to build the infrastructure layer desperately needed by institutions to securely hold and trade digital assets. The platform combines a suite of technology and prime brokerage solutions, from flexible custody, to margin lending, execution services, and instant offline transfer and settlement across its proprietary network of integrated crypto exchanges Clearloop.

READ Crypto firm backed by London mayor’s fund launches platform to lure big investors

In a rapidly-expanding market and in an industry at the tipping point of critical change, Copper is ready to seize its moment.

To contact the author of this story with feedback or news, email Emily Nicolle

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