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Summing Up the 10 Biggest Fintech Deals of 2015

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Summing Up the 10 Biggest Fintech Deals of 2015

Image courtesy of: Raconteur

Summing Up the 10 Biggest Fintech Deals of 2015

How hot is fintech right now?

This one statistic sums it up: in 2015, a record amount of fintech deals were done for a total deal value of $24.6 billion. That number is higher than the last five years put together.

With everything seemingly turning up “fintech”, here is a summary and some reflection on the 10 biggest fintech deals of last year.

Summing Up the Biggest Fintech Deals of 2015

1. FIS acquires SunGard for $9.1 billion

The acquisition, financed with a mix of 45 percent cash and 55 percent stock, yields a combined company with $9.2 billion in annual revenue, 55,000 employees, and operations in more than 130 countries. Headquartered in Jacksonville, Florida, FIS is the world’s largest global provider dedicated to banking and payments technologies. Their technology underscores $9 trillion in global transactions each year.

SunGard, which was the target of the acquisition, was previously taken over in 2005 by a consortium of private equity firms in the largest tech privatization deal ever. It was valued at $11.3 billion.

2. ICE acquires Interactive Data Corp

Intercontinental Exchange (ICE) bought Interactive Data Corporation (IDC) from private equity firms Silver Lake Group LLC and Warburg Pincus LLC. Valued at $5.2 billion, including $3.65 billion in cash and $1.55 billion in stock, the deal allows ICE to expand the markets it serves while bringing in new technology platforms and data services.

ICE owns and operates 23 exchanges and marketplaces, with the most famous of these being the New York Stock Exchange (NYSE).

3. McGraw-Hill Financial acquires SNL Financial

McGraw-Hill Financial, the parent of the Standard & Poor’s ratings agency, paid $2.23 billion in cash to buy SNL Financial from private equity firm New Mountain Capital.

McGraw-Hill is also known for some of its other subsidiaries, such as S&P Dow Jones Indices and Platts.

4. D+H Corporation buys Fundtech

D+H, a Canadian corporation which was historically a manufacturer of cheques, has recently shifted its focus on more technology-related endeavors. Part of this includes buying global payment services provider Fundtech for $1.25 billion in cash.

In a recent press release, D+H described the transaction as a key piece in their transition to technology: “The Fundtech acquisition significantly advanced D+H in our FinTech journey and was evidence of our commitment to continue providing clients the innovative solutions they need to grow and compete.”

5. Lufax is funded by multiple investors

Lufax, also known as the Shanghai Lujiazui International Financial Asset Exchange Co., is an online Internet finance marketplace in China. Focusing on peer-to-peer loans, Lufax connects individual investors with borrowers for loans of around $10,000 while collecting a 4% fee off each loan.

Domestic and overseas institutions participated in the most recent $1.2 billion financing in December, including the investment arm of COFCO Group and Guotai Junan (Hong Kong). The company is considered a mover and shaker in the Chinese lending space, and is now valued at $18.5 billion.

6. Lufax is funded by multiple investors

Lufax was also responsible for the sixth biggest deal of 2015, as it did an earlier raise in March 2015 for $488 million from a group of investors at a valuation of nearly $10 billion.

7. Markit

Markit, which recently announced a merger with IHS to create a data heavyweight, was also very active last year.

In 2015, it initiated a secondary public offering of its common shares to investors worth $350 million.

8. Learnvest acquired by Northwestern Mutual

Northwestern Mutual went all-in on personalized financial planning by buying New York-based startup LearnVest for over $250 million.

9. Neustar acquires TNS

Real-time information services provider Neustar bought caller authentication assets from Transaction Network Services (TNS), an affiliate of Siris Capital Group, for $220 million in cash.

10. Markit buys CoreOne

Earlier in 2015, market data company Markit bought CoreOne Technologies, a global leading provider of regulatory reporting for $200 million.

Original graphic by: Raconteur

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Chart of the Week

The 10 Breakthrough Technologies That Will Define 2019

Which innovations will dominate headlines in 2019? According to Bill Gates, watch for these 10 breakthrough technologies to change the world.

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The 10 Breakthrough Technologies That Will Define 2019

Gone are the days of turning stones into spears. With the advent of new technologies, we’ve learned to develop tools that not only make living faster and easier every day, but also improve the future of humanity as a whole.

Today’s Chart of the Week draws from the MIT Technology Review, which features Bill Gates’ predictions for the top 10 breakthrough inventions that will capture headlines in 2019.

Top 10 Breakthrough Technologies

1. Gut Probe in a Pill
These swallowable devices can detect and potentially prevent diseases that cause malnutrition and stunted growth in millions of children worldwide.

2. Custom Cancer Vaccines
Personalized cancer vaccines, targeting only the cancerous cells and leave healthy cells alone, could help ensure faster recovery times and pose fewer risks to patients.

3. Meat-free Burgers
Plant-based and lab-grown food products will ideally alleviate the environmental impact of the livestock industry.

4. Smooth-talking AI assistants
The AI assistants of the future will have even more human-like conversations to personally engage customers. Companies would see measurable benefits, with just one breakthrough here garnering a 5% jump in productivity.

5. Sanitation without sewers
Improperly drained sewage causes death in one out of every nine children. Sanitation that doesn’t require sewers would not only prevent exposure diseases but also help turn waste into useful products like fertilizer.

6. ECG on your wrist
While most medical ECGS have up to 12 nodes to detect abnormalities, today’s wearables typically have only one. An ECG on the wrist would help reduce the risk of heart disease by monitoring changes and patterns in daily life.

7. Robot Dexterity
Advancements in robotics will enable the natural dexterity required to complete a greater range of tasks, such as helping an ailing loved one out of bed, doing the laundry, or building toys.

8. Predicting Preemies
Premature births are the leading cause of death for children under five years old. Tests to detect the possibility of a premature birth could be available in doctors’ offices in as little as five years.

9. Carbon Dioxide Catcher
Carbon dioxide catchers filter out CO₂ from the air and capture it for other uses. These include synthetic fuel creation, CO₂ for soft drinks, and plant growth in greenhouses.

10. New-wave Nuclear Power
Traditional nuclear reactors produce ~1,000 megawatts (MW), while these proposed mini-reactors would produce tens of megawatts ─ making them safer, more stable, and more financially viable for potential users.

A Vision for a Better Future

The biggest takeaway?

Seven of the 10 breakthrough technologies stem from the healthtech sector.

While several inventions on this list are years away from becoming a reality, they continue to embody the vision and passion that humans share to create and explore.

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Visualizing the Importance of Trust to the Banking Industry

In the digital age, the issue of trust is emerging as the game-changing factor in how consumers choose financial services brands.

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Visualizing the Importance of Trust to the Banking Industry

In the digital age, money is becoming less tangible.

Not only is carrying physical cash more of a rarity, but we are now able to even make contactless payments for many of the products and services we use on the fly.

Our financial transactions are starting to be analyzed and optimized by artificial intelligence. Meanwhile, investments and bills are paid online, and even checks can now be deposited through our phones. Who has the time to visit a physical bank these days, anyways?

Trust in the Digital Age

The migration of financial services to the cloud is increasing access to banking solutions, while breaking down barriers of entry to the industry. It’s also creating opportunities for new service offerings that can leverage technology, data, and scale.

However, as today’s infographic from Raconteur shows, this digital migration has a crucial side effect: trust in financial services has emerged as a dominant driver of consumer activity.

This likely boils down to a couple major factors:

  • Tangibility
    Financial services are becoming less grounded in physical experiences (using cash, visiting a branch, personal relationships, etc.)
  • Personal Data
    Consumers are rightfully concerned about how personal data gets treated in the digital age

Further, the above factors are compounded by memories of the 2008 Financial Crisis. These events not only damaged institutional reputations, but they elevated trust to become a key concern and selling point for consumers.

Trust, by the Numbers

In general, trust in banks has been slowly on the rise since hitting a low point in 2011 and 2012.

At the same time, consumers are consistently ranking trust as a more important factor in their decision of where to bank. To the modern consumer, trust even outweighs price.

Top Five Factors for Choosing a Bank:

  1. Ease and convenience of service (47%)
  2. Trust with the brand (45%)
  3. Price/rate (43%)
  4. Service resolution quality and timeliness (43%)
  5. Wide network coverage of ATMs (40%)

It’s important to recognize here that all five of the above factors rank quite closely in percentage terms. That said, while they are all crucial elements to a service offering, trust may be the most abstract one to try and tackle for companies in the space.

With this in mind, how can financial services leverage tech to increase the amount of trust that consumers have in them?

Tech Factors That Would Increase Consumer Trust:

  1. Reliable fraud protection (36%)
  2. Technology solves my problems (13%)
  3. Useful mobile application (9%)

Better fraud protection capability stands out as one major trust-builder, while designing technology that is useful and effective is another key area to consider.

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