Spotting Emerging Fintech: Y Combinator Summer ‘20 Batch

98 companies presented over the past two days at Y Combinator demo day over the past two days, and as always I take a look at what interesting fintech companies are emerging fromthereon.

Below are 11 of the most exciting startups classifiable as ‘fintech’ in a narrow sense.

Again, there is a strong bias towards infrastructure & underlying data; playing into the embedded finance narrative. Solutions which are servicing and solving pain points for small and medium businesses also came in very strong.

On the other were only two companies which were directly engaged in broad consumer propositions.

Another point of interest was the geographical compositions of these fintech startups - from total of 7 non-US companies 6 came from quickly developing markets such as India, Indonesia and Brazil which boast massive untapped opportunities and consumer bases. Perhaps a sign of times to come.

Note: selection, geo and categorization done by the author; the descriptions of companies attributable to this Techcrunch article.

Infrastructure & Data

Atomic: (US) A software company that provides a fintech API allowing other platforms to integrate investment accounts into their product, easily. Many modern fintech services allow you to hold cash, like Venmo and Apple Pay. That money could be, instead, invested. Atomic has found some initial traction, with a few companies signed up that give it around $300M in AUM, providing the startup with $1.5M in ARR. After every fintech added checking accounts, perhaps investments accounts are the next step.

Blue Onion Labs: (US) This financial services startup is helping companies make sense of financial transaction data that lives across multiple systems. Their suite of API integrations are aiming to solve a big pain point for accounting teams, serving as a “single source of truth” for understanding the full scope of incoming transactions. 

Decentro: (India) Continuing the X for India trend that is taking shape in this batch, Decentro wants to build Plaid for India. The company provides an API for banking integrations, like Plaid. That Plaid sold for billions of dollars earlier this year is still on the mind of every sentient VC, so the comparison could prove enticing. Decentro is still small, with around $1 million in gross transaction volume (GTV), and around $7,000 in MRR. Still, with just four customers and 45 more in the pipeline, it’s on a good path. 

Heron Data: (UK) A B2B company meant to help fintech services categorize/label bank transaction data using methods they promise are more accurate and cheaper than existing solutions. 

SMBs

Evergreen: (US) A digital solution for employees to request purchases and track approvals. The B2B business is built for companies with non-centralized purchases and the need to manage a slurry of different tools. 

BukuWarung: (Indonesia) A micro-accounting app for merchants in Indonesia. It enables mom and pop stores to bring payments and credit to their businesses. The service currently has 350,000 monthly active merchants. 

VoloPay: (Singapore / South East Asia) The startup wants to be Brex for South East Asia. VoloPay seeks to bring approvals, bill payments, expenses, and accounting automation all under one roof and with one platform. It streamlines payments through a corporate credit card, and in 3 months users have spent $90,000.  

Conta Simples: (Brazil) A digital bank account for startups based in Brazil. The startup helps other online businesses get corporate cards fast and without big fees. Last month, the startup made $50,000 in revenue. The founding team hails from various payments and fintech businesses in Brazil.

Plunzo: (LatAm) Helps SMBs in Latin America bring all of their bank accounts into a single UI. The company’s founders say that after launching in early august, they’re already working with over 3,000 retail accounts.

Retail Consumer

Thndr: (Egypt) Thndr is aiming to build a Robinhood for the Middle East, helping users invest in stock, bonds and funds commission-free via the company’s free app. Robinhood has taken the US exchanges by storm, but the trend hasn’t hit investors in the Middle East; Thndr is aiming to replicate their success with investors there.

Perch: (US) Pitching itself as “Credit Karma for the underbanked”, Perch helps users build their credit score by turning recurring payments (like rent) into credit payments. The team says they currently have 22,000 users on the waitlist.