Amazon and Better.com an unlikely pairing


welcome to Exchange! If you received this in your inbox, thank you for your subscription and vote of confidence. If you are reading this as a post on our site, please register over here So you can receive it directly in the future. Every week, I look at the hottest fintech news from the previous week. This includes everything from funding rounds to trends to niche analysis to hot takes on a specific company or event. There’s a lot of fintech news out there and it’s my job to stay on top of it – and understand it – so you can stay informed. – Mary Ann

Last week, my good friend and co-host of the Fairness Podcast Natasha Maskerenhas And I reported that Amazon Has reached an agreement with a busy online loan lender Better.com To provide new benefits to employees. Specifically, Better.com announced the launch of Equity Unlocker, a program that allows employees to use their equity as collateral when trying to buy a home. Amazon employees in Florida, New York and Washington state will be the first to test the device. What’s unique about the program, according to Better.com, is that employees will have the ability to finance their homes without selling their shares, simply pledging to give up ownership.

The news, to be honest, came as a bit of a shock to those of us who have been following the progress at Better.com. For the uninitiated, the fintech company has had its fair share of struggles that cast doubt on its future. Last May, TechCrunch reported that Better.com was on track to lose more than $300 million in 2021, after a rapid-fire run of business driven by a slowing housing market and rising mortgage interest rates. Rates. Then in the first quarter of 2022 alone, Better.com posted a net loss of $327.7 million, according to an SEC filing.

The company’s name has gained notoriety following several rounds of mass layoffs, which have also led to executive exodus. Better.com made headlines when the SPAC filing still looks to be moving forward, despite the poor initial performance of the blank check combination.

So why would Amazon want to connect with a company that seems far from growing and has a less-than-stellar reputation and bring in its own employees? Well, we asked Amazon (not in those exact words, of course). And the spokesperson told me a lot about how the company wants to offer all kinds of health benefits to its employees and that fits into that concept. But “why better.com?” He did not respond. The fintech itself has been a customer of Amazon Web Services since 2015, and its loan origination system is entirely powered by the software, he said. A quick Google search by TC Senior Correspondent Rebecca Szkutak turned up at least two other online mortgage lenders who were AWS customers, so the retail giant had other options.

Beyond that, the idea of ​​giving employees the option to use equity in the purchase of a home just doesn’t seem… very appealing. What if the stock goes down in value? How does it even work? Who owns enough property to use it as collateral? On top of that, Better.com says it charges 0.25% to 2.5% higher interest rates to employees who choose to buy a home this way. Mortgage interest rates are currently high enough – hovering around 6%. Another tack on 2.5% pushes one into the 8% range. We are all very excited to see how this ends and I plan to report back on it in a few months.

Meanwhile, speaking of Better.com’s SPAC filing, HousingWire reported last week that “a blank check firm Aurora Acquisition Corp. It extended its deadline for a third time to complete its merger with struggling digital mortgage lender Better.com. The deadline for the merger is now September. The decision was reached at a meeting of Aurora shareholders on February 24, according to filings with the US Securities and Exchange Commission (SEC).

The notion that Better.com, which has had so many hurdles and so much negative publicity, could go public in an environment where even growing companies that share positive financial metrics hesitate is hard to believe. I, for one, am very curious to know how the company will float.

Listen to the podcast here to hear the equity team’s thoughts on the Amazon/Better.com partnership (and more!). And while you’re at it, tune in for a one-on-one chat with me Index Venture Partner and fintech leader Mark Goldberg. We had a lot of fun discussing all things fintech and Mark didn’t hold back! Oh, and ICYMI, I also spoke with managing partner Hans Tung. GGV A few weeks ago. You can find that super interesting convo here.

Weekly news

As Romain Dillet reports: “The all-in-one fintech app revolution It has released its annual report for 2021. With 2021 ending a year early, the report includes some significant figures, with the company nearly tripling its revenue between 2020 and 2021. As a result of this explosive growth trajectory, UK Digital Bank has reached profitability. first time. Revolut’s financial success starts at the top of the funnel. In the year By the end of 2021, Revolut had more than 16 million customers, a 46 percent increase compared to 2020.

We wrote about it last week Klarna’s Momentum in the US This week, Swedish payments giant Despite a large ($1 billion) operating loss in 2022, it said it expects to return to profitability this year. In this episode, Alex Wilhelm asks, “How well is Clarina progressing toward profitability?” he asked. He wrote: “The early beginnings had a few difficult parts in public. The news around Klarna has been negative for a while now, with speculation drastically reduced and even layoffs. Now that we have the company’s financial data, we can see in detail how it performed amid the noise.

Aisha Malik reported:DoorDash It is launching its first ever credit card. chase. The DoorDash Rewards Mastercard gives cardholders the chance to earn cash back on purchases made with the card at checkout… The launch of the new credit card shows that DoorDash is looking for ways to build customer loyalty and keep the platform at the forefront. The mind of the users. The move gives DoorDash the ability to offer consumers additional benefits while opening up new revenue streams.

Carly Page reports:Hatch BankA digital-first bank that provides infrastructure for fintech companies to offer their own brand credit cards, hackers exploited a zero-day vulnerability in the company’s internal file transfer software that allowed them to access thousands of customers’ Social Security numbers.

Based in London Wise, formerly known as TransferWise, is launching two new products in the US – Wise Business cards and sending money online. It also unveiled a new brand look that it says “currently draws inspiration from its 16 million customers worldwide.” Since the company publicly listed on the LSE in July 2021, it has grown its global customer base to about 6 million, he told me in an email.

Amsterdam-based payments behemoth We killed It claims to be the first globally to embed a pay-to-click experience into its online checkout flow. A spokesperson told me via email: “When shopping online, most ‘guest shoppers’ manually type in their card details to make a purchase. According to the spokesperson, the Click to Pay feature “is a new online payment method that combats the risk of failure at the checkout stage” by making checkout easier and more secure (the original identification number is not typed at check-out and the consumer receives a one-time password) and It is universal so it can be used on both devices and browsers. More here.

Reported PYMNTS.com: “A San Francisco-based financial services platform Modern treasury It is introducing a product called ‘Global ACH’, which it bills as a ‘new payment service’ that uses local payment channels to transfer at lower costs than alternatives such as SWIFT. To launch Global ACH, Smart Treasury partnered with Silicon Valley Bank… Smart Treasury Global ACH offers several advantages over existing cross-border payment options, saying it costs less than SWIFT and other third-party options.

After we covered Stripe’s Tap to Pay news last week, PayPal It has arrived to announce the launch of Tap to Pay on Android in the UK, Netherlands and Sweden in May 2022. It has since been launched in more European markets. In the year This is the release announcing our UK launch on May 5, 2022. It’s also working with Apple on Tap to Pay, as Evan Mehta reported in November.

Did you know there is a Neobank that targets doctors? Panacea Financial It describes itself as “a bank for doctors, built by doctors.” In an email, a company spokesperson told me: “One young doctor’s car accident and another’s hopes of rehabilitating a $300,000+ student loan led to the creation of Panacea to help other doctors with similar needs.

Other news

Greenlight offers new workplace financial benefits designed for families

Public.com Announces High Yield “Treasury Accounts Now Available to Everyone”

Robinhood Wallet is now available to all iOS customers globally.

Wealthfront promotes stock investing

Action for the youth and young people to start investing in stocks

Mexico’s BNPL startup Quisky achieved 10 million loans to more than 1.8 million consumers.

ChatGPT learns fintech.

First Fidelity Bank has entered the BaaS space with a Part Six partnership.

Image Credits: DoorDash

Funding and M&A

Featured on TechCrunch.

Insurtech giant Equisoft lands $125 million investment, eyes acquisitions

Drone Tech-Born Insurtech Flock Raises $38M Series B to Bring Commercial Drivers to Safety

Pagos paid $34 million as demand for ‘payment data’ increased.

Spade transforms credit card transaction statistics into clear, actionable data

Varo said Stripe is raising new funds at very low rates.

And elsewhere

Highway benefits raise $3.1M for seed funding

SoftBank leads Series A for Chilean startup Rankimi, which has teamed up with Mexican payroll provider Osmos.

TTV Capital closes Fund VI with $250 million to invest in fintech at the first stage

Fintechs hiring

The good news was that I was flooded with DMs and emails from people letting me know that their fintech company was hiring. The bad news is there’s no way I’ll be able to include them all in this week’s newsletter. So if you find it and don’t see your company here, check out the upcoming issues of The Interchange. I’m going to the details!

  • Corporate expense management (and completely remote) company Air BaseIt secured $150 million in debt financing from Goldman Sachs last July, and is hiring about 18 jobs.
  • wealth front17 vacancies in engineering, design, marketing, finance, and more after the merger that landed UBS last year with $69.7 million in a $1.4 billion contract.
  • SmartAssetThe marketplace, which connects consumers with financial advisors and raised $110 million in a Series D round of funding in June 2021 at a unicorn valuation, is hiring in a variety of remote roles.
  • Alternative investment platform capital, AUM of more than $150 billion says it is hiring for 100 roles.
  • Communication agency focused on fintech KCD PR It is hiring and has several open positions with plans to add 3–5+ roles by 2023.

Thinking of coming to Riot this year? We would love to have it! But FYI, this is your last chance for super-early-bird tickets. That’s it for this week! I go to enjoy the 70-something-degree weather here in Austin whenever I can. Hope you all have a great weekend – see you next time. xoxoxo, Mary Ann





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