News Briefing - Crowdfunding, SME And Alternative Finance

Room full of people discussing things for sale.

1.UK – FinTech

Santander has acquired a majority stake in Ebury after an investment of £350 million, reports AltFi.

“The fundraising will support expansion plans in Latin America and Asia of the payment and currency platform for SMEs. Santander owns 50.1 per cent stake of Ebury following the deal 

Ebury says it is now active in 17 countries and 140 currencies and has increased its revenues by an average of 50 per cent per year over the past three years.”

 

2. UK – FinTech

A staffing revolution at Revolut. AltFi reports.

“Digital banking service Revolut has lost eight top employees since the middle of March this year, although the departures are not linked to Covid-19.

The news, first reported by Financial News, comes amid a period of uncertainty for Revolut as, just two weeks ago, it was revealed that co-founders Nik Storonsky and Vlad Yatsenko were to forgo their salaries for a year and top executives would take a 25 per cent pay cut to ensure their employees got theirs.

First on the list to depart the e-money institution was Revolut’s chief financial officer, David Maclean, who left the position after less than six months on 16 March 2020.

Soon after, Revolut named former chief financial officer of Standard Life Aberdeen Bill Rattray, a longtime colleague of recently appointed Chairman Martin Gilbert, as interim CFO

Just two weeks after Maclean left, Revolut’s head of wealth and trading André Mohamed, who co-founded trading platform Freetrade, left at the beginning of April.

Last week it was also reported that the banking service had also lost its deputy chief financial officer, Stefan Wille, and its interim head of finance Anna Borzenko, who had come to the end of her contract.

The most recent bunch to leave include lead data scientist Abhi Thanendran, global head of employer branding Anca Pintilie, regulatory reporting manager Alexander Gratz and North America general manager Dan Westgarth, who spoke at the AltFi Toronto Summit 2018.”

 

3. UK – Equity

The Fintech Times reports the “biggest post-Lockdown raise”. The headline points are below.

 

“Chip sees record crowdfund and strong growth despite current economic crisis

§  More than 4,000 investors take part in £2.6 mn raise

§  Funds to fuel the fintech’s growth, including the launch of an FSCS protected savings account

§  The largest equity crowdfund since lockdown began

§  Chip’s user base has increased over 40% in the first three months of 2020”

 

4. UK – AltFi

FT Adviser reports on failing IFAs.

 

“The Financial Services Compensation Scheme has declared six advice firms in default including a Devon-based business which found itself embroiled in a legal battle after advising a client to invest in Connaught. 

Exeter-based Devonshire Asset Management Limited in 2017 found itself embroiled in a legal battle after it was accused of not paying compensation to a client it advised to invest in the failed Connaught scheme. 

The adviser and client disputed the amount which needed to be paid, after the Financial Ombudsman Service ruled in favour of the latter, and the matter ended up in court. 

Devonshire had paid only £300 to the client but in 2016 a county court judge ruled that it should pay £56,800 - the advice firm had intended to appeal the decision but its insolvency practitioner eventually decided against it and dropped the case. 

In an update published today (April 30) the FSCS confirmed 12 firms had defaulted with the lifeboat body in March, with six having operated in the financial advice sector and one failed discretionary fund manager.”

 

5. UK – AltFi

 

LCF investors are raising funds from the crowd to litigate their case for compensation, following negative noises from the Financial Services Compensation Scheme. Bond Review reports.

“After being denied compensation from the Financial Services Compensation Scheme (other than a tiny handful of exceptions,) London Capital & Finance investors have raised money via crowdfunding to launch a judicial review.

As at 23rd April the campaign had already raised £7,833, exceeding its initial £7,000 target. Technically the campaign is to fund the judicial challenges of only the four LCF investors on the creditors’ committee, but if their challenges succeed, this will surely set a precedent for the rest.

London Capital & Finance investors have been both emboldened and enraged by the FSCS’ early indications that it will bail out investors in fellow collapsed minibond scheme Basset & Gold, which went into administration on 1 April.”