Bessemer backs Berlin’s Upvest in $42m Series B

Berlin-based investment API provider Upvest has raised $42m in a Series B equity funding round — which is one of Germany’s biggest fintech raises of the year, close behind Mondu last month.

What does Upvest do?

Upvest is part of the hyper-competitive club of banking-as-a-service (BaaS) fintechs that provide the core banking infrastructure for finance companies behind-the-scenes. Like many of the fintechs in this space, it’s built its own cloud-based core banking system. But unlike companies like Thought Machine and Mambu, it’s focused purely on investment products. 

Fintechs and banks can use Upvest’s ready-to-go APIs to offer their end customers investment products including exchange-traded funds (ETFs), stocks and crypto assets, instead of having to build them in-house. For Upvest, this is a reliable revenue model – as once a fintech or bank chooses them, they tend to stick to the same core-banking platform for a while. And for the fintechs and banks, it’s generally cheaper to use an API like Upvest’s than go through the complex process of building the back end of an investment platform in-house. 

And after a rigorous 24-month process, Upvest has also managed to secure licences from the German financial regulator BaFin for securities and crypto brokerage and custody — which means it’s allowed to provide these capital markets products in all the European countries that fintechs want to roll them out in. 

Upvest’s CEO and founder Martin Kassing won’t name names but says it’s working with mid to large fintechs, which could mean companies with up to $10bn assets under management. And it’s also courting banks as customers…

Who’s investing in Upvest? 

What’s the market like? 

For fintechs and banks, the appeal of an API provider like Upvest is it saves time and money when you want to launch investment products. The money saving is the real pull in the current economic environment, as many fintechs…

Read more at sifted.eu

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