The Latest in Fintech
There is never a dull moment in fintech. It is crucial that fintech entrepreneurs like you keep a look out for the latest industry updates. That’s why we have collated the recent highlights from fintech just for you:
1. Fintech Venture Raises $27 Million to Start a Bank
The banking market might be about to change forever. Fintech startup Varo Money Inc. just announced that it has raised $27 million in funding to potentially start a bank. The company’s first public funding round was led by Warburg Pincus.
In a press release, Colin Walsh, CEO of Varo said, “The US banking market is undergoing a huge transformation, and Varo is ideally positioned to offer a unique and unrivaled banking service to our target customer base.”
Varo will initially provide lending, debit card and deposit products via a mobile app. In addition, it will offer a 24/7 digital financial coach to analyze real-time budgeting and lending. The startup’s eventual goal is to seek a banking charter.
Do you think fintech startups are ready to start banking?
2. EdgeVerve Announces Launch of New Blockchain Framework
Blockchain seems to be the latest buzzword in financial technology. EdgeVenture, a subsidiary of Infosys, has designed a framework to bring blockchain-based solutions to the banking industry. This new product is a ledger that will enable banks to build more secure, efficient and accurate applications than those currently in use.
The framework is designed to be extensible, allowing banks to implement their own blockchain solutions alongside to meet their specific demands. Moreover, it claims to be “asset agnostic,” i.e. it will allow banks to deal with a range of assets within a single network.
Watch this video for more details about the new EdgeVerve blockchain framework:
3. Online Fintech Lenders Are Feeling The Heat
Last Monday, OnDeck Capital reported a loss of nearly $13 million in its first quarterly earnings. This loss far surpassed the predictions by analysts, and sent this business lender’s shares plummeting down 34 percent, to $5.50, on May 3, 2016.
This phenomenon, however, was not a one-off case. Lending Club shares went down by 10 percent as well. On Wednesday morning, OnDeck shares were down 7.34 percent at $5.10 a share, and Lending Club saw a drop of 2.46 percent to $6.94 a share.
FBR analyst Bob Ramsey blamed the weaker outlook on “reduced volume of loans sold, narrower GOS margins, and slower origination growth given weaker marketplace loan demand and tighter underwriting standards.”
The Latest in Digital Health
Health care IT is an equally hot industry right now. We have put together key industry news to help digital health entrepreneurs like you stay on top of recent industry developments:
1. Health Care Groups Pool $220 million to Fund Digital Health Innovators
In a move that is making digital health entrepreneurs sit up and take notice, Heritage Group has closed its second innovation fund, with $220 million and six new partners. This investment firm now has 15 health care organizations as its limited partners.
The fund is looking to make 15 to 20 investments. Committees with executives representing each partner will evaluate company portfolios and decide which ones to support. One or more partners may adopt the technologies at their own firms as well.
This methodology will not only introduce health care organizations to potential technology solutions, but also expose digital health companies to potential clients. Ultimately, a win-win for all.
2. Senior Management Changes in Digital Health
“After nearly six years of helping build @Rock_Health, I’ve made the difficult decision to move on,” Rock Health Founder and Managing Director Halle Tecco tweeted on May 4, 2016, sending shockwaves around the digital health industry. Tecco founded Rock Health in 2010 as the first seed fund with an exclusive focus on health care technology. In the last 6 years, Rock Health has made more than 90 investments in 80 companies.
Apple has hired Yoky Matsuoka to work on its health-focused products. Matsuoka will work for Apple COO Jeff Williams, who oversees the tech giant’s health care products, including HealthKit, ResearchKit and CareKit. Yoky Matsuoka was the former CEO of Quanttus, a startup best known for its wearable wristband for continuous monitoring of blood pressure.
3. Swallowable Sensor Pill to Remind Patients to Take Medication
Proteus Digital Health has developed a swallowable sensor pill to remind blood pressure patients to take their medication on time. The FDA-approved ingestible sensor sensor, covered on either side with copper and magnesium, stays continuously charged by the chemical interaction between the two metals in a person’s gut. A patch worn on the body picks up the signal from the sensor and passes it to a phone or tablet.
Nearly 70 trials with the Proteus reportedly resulted in 85 percent of high blood pressure patients achieving their blood pressure goal, versus about 33 percent in the usual care group,” Proteus Digital Health co-founder George Savage told CNBC.
Here’s more about the pill that uses the human body as a battery:
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