Ant Group’s IPO filing revealed some very un-ant-like numbers. The group's flagship product, Alipay, does more payment volume ($18t) than Visa and Mastercard combined ($16t), with approximately half in P2P payments. As impressive as that sounds, it is the evolution and diversification of the business that is the story.
Started as Alipay in 2004, Ant Group has transformed from a digital payments company for Alibaba to an aggregator of financial services. Today, the group's lending, wealth management, and insurance offerings count for 63% of its revenue. In the first half of this year, a further shift in revenue generation saw the credit business surpassing payments for the first time ever.
Imagine if 7% of apps available on the Apple store were bundled into a single app - that is essentially what Ant has with over 160,000 mini-apps within one super-app, Alipay.
While the US doesn't have one "super-app", big tech companies like Amazon, Facebook, and even Uber are charting a similar path. Amazon, for example, has partnered with Ola, Tapzo, and Cleartrip to expand their offerings globally while Facebook is focussed on offering community themed services like dating and marketplace.
Ant’s prospectus, for its dual listing in Shanghai and Hong Kong, states that “we call ourselves Ant because we believe that small is beautiful, small is powerful”, but if the company can keep this pace up, it will be marching on to a valuation more closely resembling an army of unicorns as opposed to anything reminiscent of its name.
WorldRemit to Acquire Sendwave in $500m Payments Deal - U.K. online money transfer company, World Remit, is buying Africa-focused, app-based remittance firm Sendwave. The combined company will be valued at more than $1.5b. Combined revenue is $280m and the value of transfers is $7.5b. Read more
The SEC changed its rules. Not only the rich can invest in private markets - Previously, accredited investors needed to have a net worth of at least $1m excluding the value of their primary residence, or an annual income of at least $200k for the last two years. Now, many more people may be able to make those investments, if they can prove that they are knowledgeable enough, including employees of investment firms or governmental bodies. Read more
NYSE’s plan for new IPO alternative wins green light from SEC - The decision by the SEC could make direct listings a more popular alternative to the traditional IPO. With the NYSE’s new type of direct listing, a company will be able to issue new shares and sell them to public investors in a single, large transaction on the first day of trading, much like the first trade in an IPO. Read more
Citi’s $900m misfire happened during software switch - Citi mistakenly sent $900m to a fleet of hedge funds reluctant to return it. While human error is mainly at fault, their use of arcane technology stretching back to the 1990s was really the issue. Citi is now waging a legal battle with the hedge funds to recover the funds. Read more
Nerdwallet acquires UK’s Know Your Money as it expands outside the US - Know Your Money is the U.K.’s largest financial products comparison site serving some 5m consumers and 1.2m businesses. The acquisition is the first of Nerdwallet's international expansion. Read more
Crypto giant DCG is betting $100m on mining Bitcoin in North America - Foundry, which has been operating below the radar since 2019, runs its own mining operations and also provides equipment and financing to crypto startups. Despite lucrative payouts, there are few significant crypto mining operations in North America. Instead, the industry has been dominated by Chinese conglomerates that pool resources while tapping into cheap sources of electricity. Read more
Afterpay acquires Spanish BNPL firm Pagantis to spearhead its advancements into Europe - With a market capitalisation of $19.8b, Afterpay is looking to Europe for its next expansion move. It will cost the fintech company €50m to buy Pagantis from NBQ Corporate SLU. Read more
China trials digital Yuan in retail settings - A new working paper from the Bank of International Settlements shows that the pandemic has led to increased interest among central banks for CBDCs. The share of central banks looking toward retail CBDCs in a one- to six-year timeframe had already doubled in 2019 to 20%. The report also found that as many as 80% of central banks are engaged in research, experimentation or development of CBDCs. Read more
ConsenSys acquires JPMorgan's blockchain platform Quorum - Quorum, which will remain open-source, is being used by the bank to run the Interbank Information Network, a payments network that involves more than 300 banks. The network and other bank projects running on Quorum will continue to operate using the platform, JPMorgan said. Read more
JP Morgan to launch digital lender in UK early next year - Goldman launched its digital challenger – which offers personal loans and savings services – back in 2018. The bank had to pause savings accounts for new users in June after it experienced a deposit surge to £21b. Currently, UK lenders are struggling to deal with ultra-low interest rates. A new lender entering the market could worsen this by sparking fresh price competition, hence putting further pressure on existing players’ margins. Read more
Cryptocurrency exchange FTX acquires portfolio tracker Blockfolio - The $150m acquisition by FTX is to launch a simpler trading experience for retail investors and involves a combination of cash, cryptocurrency, and stock. Read more
India's NPCI launches unit to take UPI and RuPay global - India's real-time digital payments system, UPI has been championed by many nations and institutions for its successful implementation in the country. The international expansion of NPCI will help expand the acceptance of RuPay and UPI that will further empower the Indians to use homegrown payment channels and platforms. Read more
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