Financial Technology, Data, and Analytics

Dear Clients and Friends:

Our April 2019 report on recent m&a transactions, trends, and value in the seven segments of the Fintech, Data and Analytics world that we follow and sometimes lead can be found below. It’s a strong market – as you will see by the valuation multiples, and number of recent transactions – and we are pleased to be a part of the landscape. At the same time we have concerns as politicians around the world seek to regulate this industry with little coordination.

We’re a believer in the need for intelligent regulation of the information technology universe intelligence “before it’s too late” as Elon Musk said. Even Mark Zuckerberg agrees that the industry could use some boundaries – and some referees. But who will lead? (It’s clear that the US isn’t doing much in this regard.)

Recently, Nick Colas wrote an interesting piece on the Tabb Forum about efforts to regulate the information industry in Europe – and the fact that Europe is slowly but surely becoming the de facto regulator of information technology firms globally. Nick notes that, while regulators in the US dither, Europe’s regulatory trajectory takes them well beyond the EU’s General Data Protection Regulation (GDPR), which is already affecting the approach to consumer privacy worldwide, as noted in our December 2018 Enterprise Data and Analytics M&A Update.  More than. More than 120 countries have enacted – or are contemplating similar privacy rules for consumer data.

Recent efforts in Europe include the UK’s proposed watch dog for “online harms”; and actions by France’s new Minister for the Digital Economy. We are particularly interested in the EU’s first steps towards regulating AI.

With little regulatory leadership being shown by others, we may have no choice but to rely on the Europeans to come up with reasonable intelligent regulation.  It’s a scary concept – and certainly not what we would suggest.  It’s not nearly as good as a coordinated global regulatory effort.  But it’s probably better than the Wild West.

A few of the more interesting recent information technology transactions include:

• BlackRock (NYSE:BLK) agreed to acquire eFront for $1.3bn,
• Toast (Boston, MA) raised $250mm in a Series E funding round co-led by Technology Crossover Ventures and Tiger Global Management, and that included existing investors Bessemer Venture Partners, Lead Edge Capital and T. Rowe Price Associates,
• Chime Bank (San Francisco, CA) raised $200mm in a Series D funding round led by DST Global,
• SimplyBiz (LON:SBIZ) agreed to acquire Defaqto for £74.3mm, valuing the company at an implied 5.8x LTM revenue and 14.3x LTM EBITDA
• Marlin & Associates’ client BidFX (London, UK), a subsidiary of TradingScreen raised $25mm from the Singapore Exchange Limited (SGX). Please click here for details.

See below for our April FinTech, Data and Analytics M&A Update.