FIS acquires fintech infrastructure startup Bond

Consolidation continues apace on the earth of fintech. FIS, the fintech large that runs a variety of cost, banking and funding companies, has acquired Bond, a startup that focuses on embedded finance, a number of sources confirmed in the present day. 

Fintech Enterprise Weekly’s Jason Mikula broke the information final week that the deal was in the works. Our sources affirm that the deal has now closed, as of in the present day.

FIS just isn’t sharing how a lot it paid for Bond, a San Francisco-based BaaS (banking-as-a-service) startup. 

However as a degree of reference, PitchBook notes that Bond was valued at $182 million the final time it raised cash, in 2020. Since 2019, Bond has raised a complete of $42 million in funding, in keeping with Crunchbase. It has a formidable listing of backers. Coatue Administration led the corporate’s final spherical, a $32 million Series A in 2020, which additionally included participation from Mastercard, Goldman Sachs, Canaan Companions, B Capital Group and former Morgan Stanley CEO John Mack. 

BaaS, typically referred to as embedded finance, helps manufacturers (typically these nicely exterior the world of finance) combine monetary companies like bank cards and financial institution accounts to in flip promote on these companies to their prospects.

Touting “an AI-powered infrastructure,” Bond works to assist digital manufacturers – together with different fintechs equivalent to Pocketbook and Everest – provide “personalised and compliant banking merchandise.” 

With roughly 30 staff, Bond’s focus has been on constructing APIs and software program that permits business and shopper bank card options, in addition to debit playing cards and accounts.

In line with an inner memo by FIS seen by Information World, the FIS and Bond management groups “will decide how the 2 corporations will work collectively,” together with how FIS will carry Bond’s capabilities into FIS’ present relationships.

FIS SVP of Platforms Himal Makwana, in partnership with the corporate’s integration administration workplace (IMO), can be main post-purchase planning actions, the memo added.

It’s not clear why Bond has opted to get acquired, however the deal comes amid a really unsettled interval within the worlds of expertise, enterprise funding and monetary companies. Funding exercise has largely grinded to a halt on the earth of startups in comparison with earlier years, which partly contributed to the collapse of two main banks specializing in the tech sector.

It’s not clear what the monetary state of play was at Bond however it’s notable that it hadn’t raised cash since 2020, and amid a decline in fintech enterprise funding particularly, M&A might have change into an attention-grabbing possibility for the startup. 

On the opposite aspect of the equation, larger incumbents like FIS in addition to bigger fintechs have been making plenty of strikes to purchase corporations like fintechs to bolt on expertise and expertise in a race to replace their very own services amid the aggressive panorama. 

Earlier this yr, Marqeta acquired monetary infrastructure startup Energy Finance in a $275 million deal. JP Morgan closed its acquisition of Aumni. And Brazilian fintech infra firm Pismo is alleged to be within the midst of being courted by the likes of Visa and Mastercard in a reported $1 billion transaction.

Not each M&A deal works out nicely, after all, with the most important typically being the toughest to digest. FIS made one of many largest-ever acquisitions on the earth of funds when it acquired WorldPay for about $43 billion in 2019. That deal by no means actually got here up trumps, although. In February of this yr, FIS confirmed that it will be spinning WorldPay off.

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