Financial Technology, Data, and Analytics

Dear Clients and Friends:

“What has so often excited wonder, is the great rapidity with which countries recover from a state of devastation, the disappearance in a short time, of all traces of mischief done by earthquakes, floods, hurricanes, and the ravages of war. An enemy lays waste a country by fire and sword, and destroys or carries away nearly all the moveable wealth existing in it: all the inhabitants are ruined, and yet in a few years after, everything is much as it was before.”

─ John Stuart Mill, Principles of Political Economy, 1848

Our September report on m&a values and trends in the FinTech, Data and Analytics world is here. All is not yet ‘as it was before’. But, we seem to be on the way…

The good news is that new COVID cases seem to be declining worldwide, treatments are improving, and vaccines are in development – even if COVID is still killing more than 1,000 Americans a day – and total deaths are projected to reach more than 200,000 in the next few months. (For context, that is more Americans than died in combat in Vietnam and Korea combined plus all who died last year from seasonal flu.) Some still deny scientific realities, fan partisan flames, and threaten to reject the results of the upcoming election. We are more sanguine.

Reality depends on where you are standing. The larger economy is still fragile. More than 100,000 US businesses remain shuttered, millions are working remotely (including us), 18 million Americans are unemployed, the US budget deficit has grown from “an absurd” $587 billion in 2016, to a projected $3 trillion. Government programs that helped us get through the past few months are expiring. But we see that many firms (including ours) have figured out how to keep moving forward – and that has led to strong equity markets, low interest rates and a return of buyers and sellers to the deal market. Many Economists now forecast modest GDP growth – for next year.

We survived the Cold War, Joseph McCarthy, the Vietnam war, Civil Rights protests, Richard Nixon, hanging chads, two impeachments, the Great Recession, and more. We’ll get past this too. We look forward to “…the great rapidity with which countries recover from a state of devastation…”.

As you will see in our latest report, m&a values are again strong and deals are again getting done in the FinTech, Data and Analytics world. We are working on a pipeline of opportunities. A few of the more interesting transactions over the past month include:

• ICE agreed to acquire Ellie Mae for $11bn (Real Estate Tech)
• Roper Technologies agreed to acquire Vertafore for $5bn (InsurTech)
• American Express agreed to Kabbage for $850mn (Wealth Tech)
• Trumid raised $200mn in a Growth funding round led by Dragoneer Investment Group (Capital Markets Tech)
• WorldRemit agreed to acquire Sendwave for $500mn (Payments Tech)
• Smartsheet agreed to acquire Brandfolder for $155mn (Digital Tech)

Ken