FIS acquires banking-as-a-service startup Bond

Consolidation continues apace on the planet of fintech. FIS, the fintech large that runs a variety of cost, banking and funding companies, has acquired Bond, a startup that focuses on embedded finance, a number of sources confirmed at the moment. 

Fintech Enterprise Weekly’s Jason Mikula broke the information final week that the deal was within the works. Our sources affirm that the deal has now closed, as of at the moment.

FIS shouldn’t be sharing how a lot it paid for Bond, a San Francisco-based BaaS (banking-as-a-service) startup. However as some extent of reference, PitchBook notes that Bond was valued at $182 million the final time it raised cash, in 2020. Since 2019, Bond has raised a complete of $42 million in funding, in line with Crunchbase.

It has a formidable listing of backers. Coatue Administration led the corporate’s final spherical, a $32 million Sequence A in 2020, which additionally included participation from Mastercard, Goldman Sachs, Canaan Companions, B Capital Group and former Morgan Stanley CEO John Mack. 

BaaS, typically referred to as embedded finance, helps manufacturers (typically these nicely outdoors the world of finance) combine monetary companies like bank cards and financial institution accounts to in flip promote on these companies to their clients.

Touting “an AI-powered infrastructure,” Bond works to assist digital manufacturers – together with different fintechs akin to Pocketbook and Everest – supply “customized and compliant banking merchandise.” 

With roughly 30 workers, Bond’s focus has been on constructing APIs and software program that permits business and shopper bank card options, in addition to debit playing cards and accounts.

Based on an inside memo by FIS seen by TechCrunch, the FIS and Bond management groups “will decide how the 2 firms will work collectively,” together with how FIS will carry Bond’s capabilities into FIS’s present relationships.

FIS SVP of Platforms Himal Makwana, in partnership with the corporate’s integration administration workplace, can be main post-purchase planning actions, the memo added.

It’s not clear why Bond has opted to get acquired, however the deal comes amid a really unsettled interval within the worlds of know-how, enterprise funding and monetary companies. Funding exercise has largely floor to a halt on the planet of startups in comparison with earlier years, which partly contributed to the collapse of two main banks specializing in the tech sector.

It’s not clear what the monetary state of play was at Bond, however it’s notable that it hadn’t raised cash since 2020, and amid a decline in fintech enterprise funding particularly, M&A might have change into an fascinating possibility for the startup. 

On the opposite aspect of the equation, greater incumbents like FIS, in addition to bigger fintechs, have been making various strikes to purchase firms like fintechs to bolt on expertise and know-how in a race to replace their very own services and products amid the aggressive panorama. 

Earlier this 12 months, Marqeta acquired monetary infrastructure startup Energy Finance in a $275 million deal. JP Morgan closed its acquisition of Aumni. And Brazilian fintech infra firm Pismo is alleged to be within the midst of being courted by the likes of Visa and Mastercard in a reported $1 billion transaction.

Not each M&A deal works out nicely, after all, with the most important typically being the toughest to digest. FIS made one of many largest-ever acquisitions on the planet of funds when it acquired WorldPay for about $43 billion in 2019. That deal by no means actually got here up trumps, although. In February of this 12 months, FIS confirmed that it will be spinning WorldPay off.

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