Financial Technology, Data, and Analytics

Dear Clients and Friends,

We hope that you and your families are safe and healthy.

As you will see from our report, the impact of COVID-19 on firms (and people) in the eleven segments of the FinTech, Data and Analytics world has not been even. Some have had to furlough employees as sales cycles lengthen, offices close and customers defer purchases. Others particularly those that provide digital or mobile channels, or facilitate eCommerce or remote working strategies are seeing significant gains.

At times like this it’s easy to engage in extremist (or wishful) thinking: Some say we will return to “normal” in 3 – 4 months. Others assert this “new normal” will continue. And then there are the politicians who want a “temporary moratorium” on all m&a. (We thought central economic control went out with the fall of the Soviet Union).

We take the long view, which not so coincidentally, is the opening chapter in my book. While aspects of the current crisis are unique, so were aspects of the Black Monday crash of 1987, the tech led crash of 2000/2001, and the housing led crash of 2007/2008. As with the others, it will take a lot longer than 3 – 4 months to recover. But this too will pass. And when it does, we will be ready. 

We are privileged to work with a wide range of smart, motivated company founders, boards, managers, financial sponsors, and corporations, who also take the long view. They may be fighting short term headwinds, but they see this crisis as spurring the continuing digital transformation of the FinTech, Data & Analytics ecosystem over the long term. They see firms accelerating efforts to modernize products, pricing, customer service, fraud prevention, client on-boarding and more. Many have significant motivation to buy, sell or raise capital. That’s where we can help.

As noted in this report, several m&a transactions that were in progress before the COVID 19 shutdown have proceeded including our recently announced transaction. Meanwhile, others are “on hold” until we can again have face to face meetings. The impact on values has been in line with the expected impact on future revenue and profit. A few of the more interesting recent transactions include:

• SoFi agreed to acquire Galileo for $1.2 billion (Bank Tech)
• Binance Holdings agreed to acquire CoinMarketCap OpCo for $400 million (Securities Exchanges)
• Airwallex raised $160.0 million in a Series D funding round led by Salesforce Ventures (Payments Tech)
• Accellion raised $120.0 million in a Private Equity funding round led by Bregal Sagemount (Regulatory Tech)
• JTC PLC agreed to acquire NES Financial for $116.1 million (Wealth Tech) 
• Collibra raised $112.5 million in a Series F funding round co-led by ICONIQ Capital, Index Ventures, and Durable Capital Partners (Digital Tech)

Few of us have been immune from the impact of COVID-19 on the health of friends and family. Please stay safe.

-Ken Marlin