Top 25 Hottest Financial Services Start-Ups

To identify the most promising financial services companies across the globe, Informilo asked some of the most active investors in the sector to nominate and evaluate 10 companies outside their own portfolios. The other 15 companies are the finalists in a competition organized by Innotribe, the innovation arm of SWIFT, the global financial services provider. The start-up challenge aims to link decision-makers in banks with entrepreneurs with creative ideas. The 15 Innotribe finalists are split into two categories: start-ups marked with an asterisk and innovators later-stage companies, marked with two asterisks. All were invited to present at Sibos, an annual conference organized by SWIFT which gathers 8,500 banks from around the world, which this year took place in Dubai, September 16th-19th. Some of the companies on the list are well established, others are below the radar but unlikely to stay there for long.

* Innotribe finalist start-up
** Innotribe finalist later-stage company

Currency Cloud
London, UK
What it does: Makes international payments and transfers simple.
Why it’s hot: Currency Cloud’s service enables businesses to send, receive, track and automate their cross-currency payments process, significantly lowering costs and reducing expensive payment failures while increasing control and transparency. Over 250,000 businesses and consumers have access to the company’s cross-border payment capabilities through 100 application partners and financial institutions.

New York, NY, U.S.
What it does: goal-based online investing tailored to individuals’ needs.
Why it’s hot: Founded in 2008, Betterment simplifies the process of investing and the presentation of information on how consumers’ investments perform. The company is backed by $13 million in funding from Bessemer Venture Partners, Anthemis Group, Menlo Ventures and angels, and now has more than $135 million in assets under management for more than 30,000 users. Its unique selling proposition: every one of its employees, including the CEO, takes customer calls.

Santa Clara, CA, U.S.
What it does: Fraud protection for e-commerce merchants
Why it’s hot:Signifyd calls itself the first fraud prevention company to incorporate social graph data into its platform. Founded in 2011 by a team from PayPal, Fraud Sciences, Fedex, and JPMorgan Chase, Signifyd helps online businesses better control fraud and abuse. In December 2012 the company raised $2 million in funding from Andreessen Horowitz, Data Collective, IA Ventures, QED Investors, and others. In beta testing with online retailers the company cut the amount of time spent on manually reviewing transactions by 60% in some cases and increased the fraud catch rate by 20% or more.

San Francisco, CA, U.S.
What it does: Virtual currency and distributed payments system.
Why it’s hot: OpenCoin has developed a new infrastructure for banks, individuals and companies to send money. Its Ripple network enables free instant transfers in any currency to any other currency.The company also aims to offer a cheaper, more efficient way of handling merchant payments, direct consumer payments, wire transfers, and remittances. In April, OpenCoin received funding from Andreessen Horowitz, FF Angel IV, Lightspeed Venture Partners, Vast Ventures and Bitcoin Opportunity Fund. Google Ventures and IDG Capital Partners joined as investors a month later. In July OpenCoin announced a “BitCoin Bridge,” allowing Ripple to make Bitcoin payments directly from the Ripple client.

San Francisco, CA, U.S.
What it does: Online payments platform targeted at developers.
Why it’s hot: Enables websites to accept payments online quickly and easily through its API. Thousands of sites of all sizes use its services, from start-ups to large companies, including Foursquare and Boxee. The company has raised close to $40 million from Sequoia Capital, Redpoint Ventures, and angels Peter Thiel and Elon Musk, and is currently valued at an estimated $500 million. In March Stripe launched a beta service in the UK, the company’s second foray outside its US base Canada launched last year. More countries are coming online throughout the year.

San Francisco, CA, U.S.
What it does: Free credit card reader for the iPhone, iPad, and Android devices, allowing anyone to accept credit cards anywhere, anytime.
Why it’s hot: Over two million individuals and businesses can now accept credit and debit payments using Square. The company is processing over $8 billion in payments on an annualized basis. Closed a Series D financing round in September 2012 investors included Starbucks, and recently expanded into Canada. In June Square launched an online marketplace called Square Market to enable local businesses to sell more goods and services. Square will face some competition in Europe from the likes of Adyen, SumUp and iZettle, which is currently in seven European markets and has nearly $50 million in investment from American Express and MasterCard.

London, UK
What it does: Foreign currency transfer services.
Why it’s hot: TransferWise keeps currency transfer costs down by using the real exchange rate and charging a low service fee. Taavet Hinrikus, a co-founder, was one of Skype’s first employees, and calls TransferWise “the Skype of money transfers.” The company says it has helped its customers to make foreign exchange transfers totaling a combined £125 million so far, half of which were made in the past six months. TransferWise plans to double the number of currencies it support, to 20.The company is backed by IA Ventures, Index Ventures, Kima Ventures, Seedcamp and The Accelerator Group. In May, Valar Ventures, Peter Thiel’s VC fund, led a $6 million round for TransferWise, bringing the total raised to $7.35 million.

Tortola, British Virgin Islands
What it does: Social investment network.
Why it’s hot: 2.75 million traders in more than 140 countries have placed more than 50 million trades through eToro’s award-winning OpenBook and WebTrader platforms since January 2012. Traders can learn from each other, share live trading information and use their collective trading power. Received Best of Show at FinovateFall for its Social Trading Index, which enables traders to create their own indices and make them available to the eToro investment network. In July eToro added fractional stock investment to its platform, enabling users to invest in the shares of large brands.

London, UK
What it does: Creators of the first open-source analytics and risk management platform for the financial services industry.
Why it’s hot: OpenGamma aims to become the new standard for Quantitative Finance, radically democratizing the financial services industry and making it more transparent. The company has raised a total of $23.35 million from Accel Partners, Euclid Opportunities, FirstMark Capital, and ICAP, and has roughly 10 commercial clients, mainly hedge funds and proprietary traders, Platform 2.0 was launched in July, and is expected to attract additional users. Demand for lower-cost risk analysis tools like OpenGamma’s is growing rapidly with increased regulation and rising data volumes; the company is well-positioned and well-funded to take advantage of market trends.

Des Moines, Iowa, U.S.
What it does: Online payment system.
Why it’s hot: Dwolla takes no percentage by fees; it charges 25 cents per transaction over $10, and transactions under $10 are free. Dwolla’s mission: allow anyone [or anything] connected to the internet to move money quickly, safely and at the lowest cost possible. Dwolla has raised $22.5 million from investors so far, and by year-end should have processed more than $1 billion for 250,000 consumers and businesses, online and on mobile.

London, UK
What it does: Social and mobile migrant remittance network.
Why it’s hot: The first player to enable individuals to make direct money transfers between international bank accounts via Facebook. The company calls its solution, “a digital wallet within your Facebook profile.” The $500 billion remittance market is dominated by large players that charge 10-20% per transaction; Azimo offers a lower-cost social solution in more than 100 countries. The company raised a £300,000 angel round in January to expand its operations. Committed to “ethical trading,” Azimo plans to donate 10% of its profits to charity.

Bangalore, India
What it does: Helps businesses simplify their view of their operating models.
Why it’s hot: Established in 2008, GIEOM offers applications to help businesses improve their way of working and decision making. GIEOM claims to help customers increase revenues and profits; create new business areas; and reduce operational waste and error. Today over 30,000 users from seven banks operating in 35 countries use the GIEOM software product.

Growth Intelligence*
London, UK
What it does: Real-time-data sales tool.
Why it’s hot: Growth Intelligence automatically generates qualified time-sensitive sales leads. It tracks the performance and activity of every business in the UK economy in real time. It claims the result is highly-accurate real-time sales recommendations and 250x times fewer wasted sales calls. Clients include BP, IBM, and Google. In July Google’s Hal Varian joined Growth Intelligence as an advisor. Growth Intelligence recently went through Accenture’s FinTech Innovation Lab, and is now based in the Level 39 accelerator. Today, 75% of the UK’s retail banks are in or about to launch pilots with the company.

P2P Cash*
Roswell, GA, U.S.
What it does: Worldwide mobile financial transactions.
Why it’s hot: P2P Cash is working with partners, including the World Bank, to create and propagate mobile banking standards to enable three billion consumers worldwide to access low-cost financial services via their cellphones. Instead of competing with others’ mWallets, P2P provides the clearing and settlement between all the various proprietary mWallets. The company’s Trusted Agent Network enables any authorized agent or retailer, on behalf of a business or consumer, to send and receive cash payments. P2P Cash has projects in process in Africa, Asia and the Caribbean.

Auckland, New Zealand
What it does: regulated, real-time clearing service.
Why it’s hot:
In June 2013 KlickEx acquired PassportFX to bolster its global services. PassportFX was a Y-Combinator start-up based in California, with global, institutional services. KlickEx is a currency exchange service, where users avoid paying bank fees by exchanging with other people. KlickEx is currently ranked as the top cross-border mobile money platform in Asia by IFAD & the World Bank, in terms of cost and in-country distribution, and is growing quickly. The company serves over 25 million customers at over 7,000 branches worldwide.

Sydney, Australia
What it does: Makes personal finance simple.
Why it’s hot: Pocketbook offers a free service and app that enable Australian consumers to see all their financial information in one place. They help users budget, manage bills, and reduce late fees/payments. The app is currently ranked second in the finance apps category of Apple’s Australian App Store. Launched just over a year ago, the company is in the process of closing an initial round of up to $A700,000. Pocketbook’s ambition is to be Australia’s

San Francisco, CA, U.S.
What it does: Prevent Anti-Money Laundering
Why it’s hot: Quantum4D is an interactive ‘knowledge utility’ platform that delivers knowledge in a visual way. The company’s stated mission is to “open the bandwidth between minds and machines.” The software turns data from various data feeds, databases and other information sources into moving visual representations that reveal trends, anomalies and relationships in real-time data. In-Q-Tel invested approximately $1 million in 2008. Customers include Global Capital Compass, SWIFT, and the Bank for International Settlements.

Realty Mogul*
Beverly Hills, CA, U.S.
What it does: Crowdfunding for real estate purchases.
Why it’s hot: Realty Mogul is a marketplace for accredited investors to pool money online and buy shares of pre-vetted investment properties. The site launched in March 2013, after incubation at the Founder Institute and the Microsoft/TechStars Accelerator in Seattle. So far it’s raised a $500,000 seed round from several high-profile angels; raised more than $3 million through crowdfunding; is working with more than 1,000 investors, and has invested more than $250,000. The company plans to grow quickly but conservatively, and to offer incredible customer service; it aims to be the Zappos of real estate.

The Entrepreneurial Finance Lab**
Cambridge, MA, U.S.
What it does: Credit scoring service.
Why it’s hot: EFL’s mission is to bridge the SME finance gap by helping financial institutions identify high-potential, credit-worthy entrepreneurs. Its service combines non-traditional data such as questions based on psychometric principles with sophisticated analytics and modeling techniques to deliver a highly predictive credit score via a scalable technology platform. The platform supports 24 languages, is available in 20 countries, and has so far processed more than 60,000 applications.

Twikey Paymandate*
Bruges, Belgium
What it does: Efficient eMandate and eContract management.
Why it’s hot: Twikey aims to help companies avoid manual admin work. Its initial focus is on a solution for the 500,000 companies in Europe that need to deal with SEPA Direct Debit changes. Twikey offers an efficient way to manage those agreements and interact with banks and software providers. Twikey also enables a seamless interface with third party CRM & ERP packages and is works with internal mandate management systems.

Virtual Piggy Ltd.**
Hermosa Beach, CA, U.S.
What it does: A safe environment for kids to shop and save.
Why it’s hot: Virtual Piggy is an e-commerce solution that aims to help kids and teens manage and spend their money online within parental controls. The company’s platform enables online businesses to function in a manner consistent with the Children’s Online Privacy Protection Act in the U.S. The Virtual Piggy shop currently features around 40 brands. The company is aiming for one million users by the end of 2013.

What it does: Mobile app security.
Why it’s hot: Mobile devices and applications are the fastest-growing targets for new cyber attacks. V-Key’s guiding philosophy is to secure mobile apps, rather than the mobile device itself. The company’s multi-layered security mechanisms ensure companies can achieve high levels of mobile security without compromising the user interface. V-Key has roughly 15 government and enterprise customers today, mainly in Asia; it’s now looking to connect with financial services and e-commerce players outside the region.

Dublin, Ireland
What it does: Brings virtualization to Java Virtual Machines (JVM).
Why it’s hot:Waratek’s CloudVM provides Java with features normally associated with the cloud, including elasticity and multi-tenancy. This can lead to reduced infrastructure requirements, lower development costs, and improved speed-to-market for Java applications. The company is backed by 50 investors from around the globe; the largest is Mangrove Capital Partners. Waratek took part in the FinTech Innovation Lab London in 2013. Its solutions are being considered for use in six of the world’s top ten banks.

XYVerify corp.*
New York, NY,  U.S,
What it does: Mobile payment authentication.
Why it’s hot: XYVerify delivers “Fourth Factor” authentication, adding both ‘where you are’ and ‘who you are’ credentials. Fraud risk is significantly reduced based on the authenticating a mobile device’s distance from a point of sale or other business, home or postal shipping address location, without any mobile app or download. The geolocation verification service could well become an essential part of the way people make and accept trustworthy mobile transactions.

What it does: Modernizes the credit card system.
Why it’s hot: Z-CRD provides an international payment transaction system that competes with Visa, MasterCard and American Express. The company claims to cut out middlemen, enabling merchants to activate its payment system through a simple plug-on download that works for almost all modern point-of-sales systems. The credit card payments market is currently worth $6 trillion; this solution threatens to turn the industry on its head.

Note: 3 Dec 14: This page was brought into style and screenshots added. The content has remained the same




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