Category: News

New Year Sees Strong VC Support for Fintech Startups

Fintech developments are allowing more people to have simpler ways to access their funds.

Investors have been backing fintech startups at a rapid clip, with more than ten deals worth more than $100 million in the first two weeks of 2021, according to an article on Pitchbook.

The article cited data points that indicate momentum is continuing from last year, when VC-backed companies in the sector saw investment of $41.7 billion. Many segments in the fintech area are growing, including technology that allows banks to better analyze financial data and digital payments.

The investment is following deals last year that showed investment had a direct impact on financial institutions that were able to augment their services by partnering with fintech providers.

Fresnel Portfolio companies are active in the fintech segment. Emergent International Payment Systems is growing payment systems in emerging economic areas by delivering electronic payments capabilities to unbanked and underbanked populations in the Democratic Republic of Congo. Emergent encourages financial growth by identifying problems in a regional economy and targeting area-specific issues that delay funds as they flow through the economy. Figuring out such challenges as cross-border transactions and enabling electronic payments for delivery drivers and utility bills helps commerce thrive where it can make a major impact on quality of life.

Another Fresnel company in the fintech space is Torus Global, which facilitates the integration of the proprietary networks of financial institutions to make it easier for customers to spend the money and value they hold in accounts across platforms. Torus Rails simplifies the flow of value in a world where commodities, crypto, and currency all need to play in the same arena.

To read more about VC-backed fintech investment, read the Pitchbook article here.

Payments Sector Primed to Lead Fintech Growth in 2021

Access and convenience are driving payments growth in fintech.

Payments will be the biggest growth area in the coming 12 months, according to recent industry survey of fintech professions. A survey of fintech professionals indicates that 61 percent consider the payments sub-sector to be the highest growth area over the next 12 months. The survey was conducted by FinTech Connect, an industry trade show that asked respondents about growth areas in their field. Respondents also mentioned ID and Regtech (technology supporting compliance with regulations and regulatory agencies) and lending as being other areas with promising growth over the same period. Fresnel portfolio company Emergent Payments is well positioned to capitalize on growth in the sector.

Read the article here.

Creating Opportunities in the Global Economy of Cashless Transactions

The world increasingly runs on cashless transactions.

A global economy driven largely by remote transactions during a pandemic is showing growth potential in areas affected by possible regulatory changes as new technologies facilitate business without sacrificing security. According to Fortune, markets to provide payment systems are shifting rapidly in light of political and social environments. The article dissects a roundtable discussion with representatives from fintech and investment banking, all sharing their thoughts on the impact of transaction fintech on future opportunities. Mobile technologies impact the whole range of transactions, from enhanced access to goods and services bought through payments from an ever-growing range of accounts to ensuring creditworthiness.

Fresnel portfolio companies Emergent International Payments Systems, Cipherium, and Torus Global create opportunities in these markets. Emergent develops payment systems through cards and digital channels to serve unbanked and underbanked populations and build trust in nascent economies ripe for growth. Cipherium creates new layers of security for cryptocurrency management. Torus Global offers next-generation fintech services while coordinating the needs of banks, financial services, and payment companies to leverage value while solving challenges presented by legacy transaction systems. Read the Fortune article.

Perpetual Sports Network Partners with Venuetize to Expand Name Image Likeness Opportunities

Perpetual Sports Network and Venuetize have partnered to create a Content Hub for collegiate athletes to help monetize their Name, Image, and Likeness (NIL). Perpetual Sports Network, a Fresnel Companies portfolio company, is implementing a three-part strategy that will come together as a single, integrated solution to protect the athlete, build their future, and provide athletes with the new NIL opportunities. A content hub will be connected to Perpetual Sports Network’s proprietary blockchain smart contract platform, a key component to protecting the athlete, providing secure levels of transparency, and additional elements of compliance tracking for colleges and universities.

On the first day that an athlete signs with Perpetual Sports Network, the Perpetual Sports Network’s Content Studio will kick off a content plan that includes robust video storytelling produced by its team of action sports and documentary experts, long-form journalism stories that are unique to each athlete, and social-media content that will share the collegiate experience of each athlete with an audience. At the heart of the Content Hub is the mobile experience platform developed and maintained by Venuetize. Employing Venuetize’s extensive experience developing mobile platforms for specific teams, leagues, and venues, the Perpetual Sports Network app is designed to host the unique content within a subscriber channel. Subscription revenue then flows to the athlete via the company’s digital ledger platform. The guidelines of the digital ledger are pre-loaded to parallel any legal, college, or university regulatory parameters as well in an effort to reduce any additional hinderance on athletic departments.

This mobile experience is designed to allow for the organic integration of paid ads and sponsored content, delivering yet another channel to generate revenue for the athlete, or collegiate institution. Additional media revenue channels include events, email campaigns, third-party audience purchasing plans, and a consumer-facing, fan-centric website. Creating a media enterprise around the athlete versus creating a platform to aggregate the athlete specific content allows Perpetual Sports Network to build lasting value for an athlete, and create a more engaged audience.

The multi-channel media approach makes the athlete the brand, creating a community around them, including their professional organization and educational institution.

“Coming together with a singular solution bridging technology and unique studio-level content will create value by protecting the athlete, building their future, and providing turnkey opportunities to monetize their NIL within the rules engine of the final legislation,” said David Glynn, Perpetual Sports Network president. “Working with Venuetize allows us to couple their mobile development and strategy teams to our platform engineers and content specialists immediately. This creates value for both the athlete and our investors on day one.”

“We are incredibly pleased to be involved in this new opportunity to help student athletes benefit from their Name, Image, and Likeness”, said Jon Romm, CEO and Founder of Venuetize. “Through this new partnership with Perpetual Sports Network, we are able to expand upon use of our platform which focuses on personalization, contextual awareness, and e-commerce. This mobile-first content hub will enable student athletes to drive deep levels of interest, engagement, and ultimately commerce, that they will benefit from for many years to come.”

About Perpetual Sports Network
Professional basketball player and coach Reggie Jordan, and sports industry veteran David Glynn founded Perpetual Sports Network to focus on Name, Image, and Likeness opportunities. The company’s technology and veteran content teams have combined a Blockchain Smart Contract Platform, a full-stack Content Hub, and a Subscription App. Bringing together these assets as a singular solution creates value and revenue by protecting all stakeholders—athletes, colleges and universities, partners, and sponsors—helping young people play an active role in building their future, and providing turnkey opportunities to monetize NIL. 

About Venuetize
Venuetize is the leading mobile technology and advanced e-commerce platform for the sports, hospitality, and entertainment industries. The company’s mobile platform integrates with existing venue infrastructure to deliver mobile wallets, contextual advertising and information, and other applications that improve and innovate the guest experience. Founded in 2014, Venuetize works with professional sports teams, stadiums and arenas, casinos, entertainment districts, and shopping destinations throughout North America. For more information, visit Venuetize.

Read the full release from Venuetize.

Lessons Abound as Venezuela Becomes a Proving Ground for Mobile Payment Apps

Venezuela’s people have embraced mobile payment app Zelle.

According to an article in Bloomberg Businessweek, the use of mobile payment apps is growing around the world, largely due to the impact of the coronavirus outbreak, which has caused lockdowns and increased shoppers’ concerns about infection through by using cash or credit card readers. Nowhere is this effect more apparent than Venezuela, where a devastating combination of coronavirus infections, an anti-capitalist government dealing with both international sanctions and exploding inflation, and a crumbling economy, has become a petri dish of sorts to demonstrate how a cashless society functions.

As a leader in the U.S. peer-to-peer payments market, Zelle logged 842 million transactions totaling $217 billion through Q3 of 2020, which represents a 64% increase to the same point last year. Local firms estimate that 17 percent of transactions at retail establishments in Caracas go through the Zelle app, and reports indicate other Venezuelan cities are seeing similar usage levels.

Companies in the Fresnel Companies portfolio operate in this burgeoning sector, where Emergent International Payment Systems and Torus Global both focus on delivering ever-greater purchasing power to un-banked and under-banked populations through a variety of platforms.

Read the Bloomberg Businessweek article about Zelle and Venezuela.

Venture Capital Activity in Healthcare and Wellness Segments Continues Growth

Healthcare technology companies have attracted VC attention in Q3 2020.

Digital technologies are finding their way into the health and wellness industries and venture capital investment is leading the charge, according to Pitchbook. Pharmaceutical companies, medical practices, drugstores, and even gyms and spas are looking to accommodate the demands of patient-driven care with better patient-engagement solutions, data-driven decision-making through software that provides data collection and analysis, and improved records management. Digitization yields benefits such as helping organizations comply with regulations, reduce costs, improve care delivery, and reach new markets. Fresnel Growth Capital is exploring some interesting possibilities in this expanding sector—contact us to learn more.

Cited in the Pitchbook report are VCs’ increased investment, to $2.1 billion in Q3 2020. The activity is mostly taking place in North America, where more than 80 percent of the VC funding is concentrated. The sector has closed 263 deals totaling $5.2 billion YTD, beating last year’s value and approaching the number of deals.

Read the report preview from Pitchbook here.

Blue Creative Group Develops Video Program for Healthcare Disruptor DispatchHealth

Blue Creative Group shot video on call with a DispatchHealth care team.

Fresnel Growth Capital company Blue Creative Group is now providing marketing services to DispatchHealth, which is disrupting healthcare by reinventing how comprehensive healthcare can be received in the patient’s home.

DispatchHealth recently announced the closing of $135.8 million growth capital financing. The Series C round was led by Optum Ventures and included participation from existing investors Alta Partners, Questa Capital, Echo Health Ventures, new investors Oak HC/FT, Humana Inc., and additional strategic investors. This investment in DispatchHealth’s comprehensive in-home care model is key for millions of patients with medical and social needs for high-acuity, lower-cost medical care. The additional funding enables DispatchHealth to help even more vulnerable, high-needs patients by growing in existing markets, expanding to new markets, and launching additional services.

“We love working with companies that develop a business model to think differently about real challenges, and DispatchHealth has identified several of those in the healthcare space, thanks to current circumstances,” says Andy Hawk, Blue Creative Group partner and executive vice president of client strategy. “The Blue Creative Group team will be capturing stories of patients and healthcare industry partners and bringing these stories to life through video and written content.”

Blue Creative Group is producing video and other materials to share the story of the DispatchHealth model, designed by expert clinicians to translate the skillset typically found in an emergency room or in a hospital, to where patients are treated in the context of their unique social situation.

Building Businesses and Relationships, and Always Using the Metrics

Scott Murray weighs the data for every decision.

Scott Murray is President and Co-Founder of Digital Latitude Solutions, and he uses his more than two decades of experience delivering services and solutions for consumer brands and retailers. We asked him about his thoughts on business, including creating value through relationships and coordination among his partners and clients.

What does Digital Latitude Solutions do, and how does it fit in with the Fresnel Companies philosophy of enterprise optimization?

We fit into the Fresnel Companies by lending our perspective to anything that really touches a retailer or a consumer directly—those are really the kind of connections that we bring to the businesses in the portfolio. We work with both emerging brands, and those brands could be anything from the technology side to consumer products to concepts that folks are looking to bring to market, as well as consulting with Fortune 500 companies to help them work with retailers. For manufacturers, we help bridge a gap in knowledge base so we can help with communication as well as strategy to help those folks succeed at what they’re trying to do.

We work with companies to build that infrastructure and to help them get their ideas to market. A lot of these people are either entrepreneurs or have been in business and worked in an industry for a period of time, but they’re trying to make a leap into another segment of that business. We help our clients generate data-driven product sales through our consumer-centric go-to-market strategy.

Can you share an example of your solutions for a client?

From a product perspective, one of our past clients was a hydroponic lettuce company. They had a vision, which was, “We’re going to build a greenhouse, and we’re going to grow hydroponic lettuce.” But as we worked with this group, one of the things that we conveyed very quickly is that if you’re growing something, it’s not the field of dreams—If you build it, they will come doesn’t work in that space. Once you start growing, you need to have an outlet where your products will go. We worked with them to build a strategy from a brand perspective. The marketing team got them to a certain point in that journey. We took it from there and brought it to a customer, and we worked with them from an operational perspective to say, “Here’s your demand cycle that you have for a product. Here’s your consumer. How does that fit into a growth cycle so that you can take product to market and do that successfully and profitably?”

How do you apply your unique perspective?

One client we have been talking to now is a long-established company looking for growth strategies in areas outside its core business. We connected them with Fresnel’s full-service marketing services agency, Blue Creative Group, which developed a consumer-facing website. Now that the site is launched, we’re creating a strategy to help build that business. Throughout the process, we ask some core questions to get to the heart of what their business is, and what it is not—but could be. After we look at all of these different components, we can put together a strategy and action steps.

It sounds like some of these questions may be complicated for a business to answer. How do you distill the strategy into action steps?

As we go through the process, there’s one thing that we pride ourselves on: Everything we do is based on fact. We make decisions based on metrics. We try to understand all the details of what’s driving a process. We’re driving the business forward and understand as we pull these different levers, we’re always asking, What’s the value proposition behind it? Because something may look like it’s working and being very successful, but when you start measuring and understanding it, it might not be very profitable. There may be a segment of the business that is growing or not growing and it’s a flat line. A segment of the business may have been around for a long period of time, but it’s the most profitable segment of the business, but the company is just not investing in that piece or that product. We work with those retailers, those manufacturers, all of those folks, to find those pieces and adapt them to the marketplace.

Consumers see a lot of “cool” businesses out there, for example, a standup paddleboard company, and their product is one of a hundred or more in crowded market. And yet, their marketing is very polished, carving out their niche. Can you help a company like that?

A lot of entrepreneurs who built these businesses are super successful and super smart, and they’re very good at chasing that dream. They get that dream to a certain level. And then once they get to that level, the question is, how do you make that next step? And in the case of that paddleboard company, it could be somebody that designed the paddleboard in their garage and started to bring it to market, and, just doesn’t know how to take those next steps. We can help them.

Some companies use their resources to hire folks to help them do that. But others are at a stage in their growth and they can’t afford to do that, so they outsource some of the marketing. They can engage us in the same tactics. From a strategy perspective, you know, we help them to find what that is. So, for example, a paddleboard company comes to us. We ask, How many paddleboards can you make in a week? What’s your capacity to ship all the different pieces? We can look at the business and say, “Okay, your target is you want to get Bass Pro Shops as a client. To do that, you need to be at this level, producing and shipping this many pieces.”

So you can help them check off the boxes to meet the requirements for major retailers, but a big part of it must be finding the right fit for their brand.

A lot of our clients work with our partnerships and our members. That referral network really helps us grow from a business perspective. We also have the referrals from our own client base that we’ve worked with in the past, because a lot of these folks form our network.

We’ve got a company we’re working with right now, a coffee company that came to us through a friend that I’ve worked with in the past. They were looking for help launching this brand into retail and didn’t know what to do. And they hear through their network, Hey, you need to talk to these guys. We specialize in the smaller boutique-type brands that that are emerging.

The question becomes, “What is the strategy?” A lot of these folks that we’re seeing right now are online retailers, and they want to take that next step. “I have a website. I sell a product on my own website. How do I sell product somewhere else? And then how do I drive my overall brand?”

Now, ecommerce sales are growing, obviously, at a huge clip. But retail is going to give you more awareness and presence—there are a lot of brands out there you may have not have ever heard of.

A good retail strategy includes understanding how consumers use the retail outlets available to them, but with DLS it seems to go beyond that.

It does. For example, we work with NCR (National Cash Register) in a contract with DeCA, serving the military for supermarkets on bases all across the country and around the world. We work with them to develop that organization in their category management, their pricing strategies so that they act and can adapt more as a retailer, but still provide the benefit that they’re charged with from Congress for the service members. So it’s really working with within those organizations and adapting systems and strategy to still provide the need and the core business.

As we work with retailers to bring those ideas and strategies together, we help them grow and succeed, and also our company grows and succeeds as our customers do. Because our customers are our partners, they’re driving sales and value, then we take the next step and also encourage the connections between our customers.

Draft of European Crypto-Asset Regulations Indicates Friendliness to Innovation

European regulators are eyeing crypto-assets in advance of stablecoins growth.

The European Commission is drafting legislation pertaining to digital assets, particularly crypto-assets and blockchain fintech, according to reports. An article on the website notes that the European policymakers seek to set out terms that will be friendly to innovation in the burgeoning sector of digital assets. While legislation is expected to appear this month, the commission has sought comment from European Securities and Markets Authority and the European Banking Authority to determine how current financial services regulatory framework applies to crypto-assets. The European authorities are seeking to ready their regulations for the emergence of stablecoins, the name given to crypto-assets that tend to be based on fiat currency, which are expect to increase utilization of crypto-assets.

Fresnel Companies portfolio companies Torus Global, Emergent International Payment Systems, and Cipherium all work with digital assets. Torus Global links disparate transaction infrastructure through a unified rail system that creates a seamless worldwide network. Emergent International Payments Systems launched the suite of Brand Banking™ solutions specifically for unbanked and under-banked workers and their communities in Africa, the Middle East, and the Indian Ocean regions, using customized solutions to eliminate the resistance to brick-and-mortar banking within these key markets. Cipherium holds proprietary applications suited for blockchain, cryptocurrency, network security, and all point-to-point payments applications, including fraud prevention.

Read the article.

Digital Assets Will Play a Large Role in Next-Gen FinTech

Payments infrastructure, cryptocurrency, and getting value into the hands of consumers will all be keys to the future of fintech’s next generation.

Anyone looking for growth opportunities in fintech need search no further than technologies that allow consumers to access the value held in cryptocurrencies more readily, according to an article on The B2B Payments article, “Laying the Groundwork For ‘Fintech 2.0’ With Digital Assets” outlines a number of points as reasons for this, but topping the list is that a number of governments throughout the world are exploring proprietary state-backed tokenized assets or stablecoin.

Fresnel Growth Capital companies are well represented in this market already. Torus Global applies its Torus Rails global technology solution, to provide a network of networks for infrastructure support to banks and financial institutions. And Emergent International Payments Systems works with entities, including municipal governments, to implement E-pay solutions and issue payments cards. Also, Fresnel Portfolio company Cipherium adds a full slate of blockchain security expertise and experience.

According to the article, “One of the biggest use-cases among adopters so far has been in the payments and remittances arena, with another camp of clients wielding the technology to use digital assets as a means of stored value for trading.”

Read the article here.