Finally, a bunch of SMB-focused fintechs get investor love while M&A activity heats up

Welcome to TechCrunch Fintech! It’s finally cooling down here in my home base of Austin, Texas, and that makes me happy.

In this week’s newsletter, we’re looking at a big raise in the embedded fintech software space, a flurry of M&A activity and SMB-focused fundraises and more.

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The big story

Miami-based Finally picks up $200 million in debt and equity

The SMB-focused bookkeeping, accounting and finance startup Finally raised $50 million in a Series B round of funding and secured a $150 million credit line, TechCrunch was the first to report. The deal came just months after a $10 million growth raise. While the Miami-based company wouldn’t disclose valuation, its CEO told TechCrunch it was “an up round.” In some respects, SMB-focused Finally competes with the likes of Brex and Ramp as it offers expense management and a corporate card. But the company maintains it’s “a multi-product platform” that, for example, also offers payroll processing. Overall, according to PitchBook, enterprise fintech bounced back slightly in the second quarter, with deal value up 27.1% quarter-over-quarter after two consecutive quarters of decline.

Analysis of the week

Paylocity to acquire Airbase

Last week, I broke the news that Paylocity was acquiring corporate spend startup Airbase for $325 million (although the deal is actually valued higher, according to inside sources). It marked the second exit for founder Thejo Kote, and while it was a sales price that was markedly lower than what Airbase was valued at in 2021, it appeared to be an impressive exit. Estimates based on information provided by Paylocity (here and here) peg Airbase’s revenue run rate to have been somewhere between $14 million and $15 million, which would represent about a 22x multiple.

In other M&A news, digital banking startup Mercury quietly announced it had acquired Teal, a seed-stage startup that builds accounting products and recently raised $8 million.

And in even more M&A news, C&R Software announced it has agreed to acquire social impact fintech SpringFour. And Dubai-based open banking platform Tarabut said it had acquired U.K.-based Vyne in an effort to expand its fintech services. 

Dollars and cents

A new $378.5 million fund

PruVen Capital, a fintech and insurance tech venture fund founded by former Battery Ventures and Citi Ventures VC Ramneek Gupta, has closed a new $378.5 million Fund II to invest in financial services and enterprise-focused startups. 

Founded by former Uber and PayPal alums, Palm announced a $6.1 million seed round led by Speedinvest and Target Global. The company has built an all-in-one platform to let businesses move money between hundreds of bank accounts and subsidiaries in a more efficient way. 

What else we’re seeing

A bunch of SMB-focused startups raise money

Besides Finally, there were other SMB-focused startups that raised money last week. Validus, a Singapore-based digital lending platform for small and medium businesses, secured $50 million in debt financing from HSBC under the ASEAN Growth Fund strategy.

Drip Capital, a fintech that provides working capital to SMBs, picked up $113 million — $23 million in equity from Japanese institutional investors GMO Payment Gateway and Sumitomo Mitsui Banking Corporation and $90 million in debt financing.

And Dubai-based Ziina, which now counts 50,000 retail and business customers after expanding its offerings to meet the needs of micro, small and medium-sized businesses in the UAE, netted $22 million in Series A funding led by Altos Ventures.

Also, more drama, including a restraining order, in the ongoing Bolt saga.

High-interest headlines

FDIC eyeing plan to protect customers from fintech failures 

Agree kickstarts with $3M to enhance agreement automation 

Bad loans pile up at Nubank, Latin America’s new No. 1 bank

PayPal pushes into in-person payments with cashback rewards, Apple integration

Klarna CEO reveals plan to reduce workforce by 50% and replace it with AI (Read more comments from Sebastian here.)

Colombian real-time payments startup raises $35M Series B

Thatch raises $38M in Series A funding

BMO helps newcomers make real financial progress through Nova Credit partnership

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