Canadian Fintech: Lendtech 💸
How to find fintech product market fit. ZayZoon comes back to Canada.
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💰 Funding
Baseline, a loan origination and management system for private mortgage lenders raised $2m.
These lenders are typically mom & pop businesses with dozens of loans on their books.
Despite being one of the fastest growing credit sectors in North America, most of these businesses run on spreadsheets.
Baseline allows these lenders to originate & service loans, syndicate to investors, integrate with broker portals as if they were enterprise lenders.
Competitor Mortgage Automator, was scooped up by private equity earlier this month.
Blossom, a social media app for investors, raised $2m. They are a killer case study in how to sniff out product-market-fit:
Blossom launched 2 years ago with the intention of becoming the “eToro of Canada”, a platform for retail investors to 1) execute trades and 2) share their stock portfolios with other users.
In order to execute trades, Blossom needed to become an investment dealer. An expensive and time-consuming licence to apply for - think Questrade, Wealthsimple, etc.
While they pursued their licence, they built out features for the non-regulated side of their business (dividend tracking & portfolio analysis) and aggressively signed on users.
Today they are sitting at over 100k users, are expanding into the US… and have scrapped their licence.
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🤝 M&A
Vault Credit, an equipment leasing company, sold off its b2b technology business to QuickBucks.
Laurentian Bank killed its equity research division.
They sold off its retail investment broker division earlier this year.
The bank will likely continue cutting to refocus on commercial lending.
🚀 Product
Quickfi, an equipment financing software company has expanded into Canada.
Coalition, cyber monitoring and insurance provider has expanded into Canada.
Flare Systems, a Montreal based cyber monitoring firm acquired US competitor Foretrace earlier this year.
ZayZoon, an earned-wage-access company based in Calgary has reentered the Canadian market.
ZayZoon originally launched in Canada, before exiting to focus on the much larger US market.
ZayZoon has raised $54m across two financing rounds in the last year.
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Have a great week! See ya 👋