We stand on the cusp of a new era in financial services. After decades of limited real product innovation, the foundations are now being put in place to enable radical transformation in the way that financial products are built and delivered. The future of finance will be fundamentally data-driven and highly personalised. As consumers we will enjoy greater transparency and choice, and we will benefit tremendously as a result.
Globally, open banking is gathering momentum and shifting the sands on which financial service companies worldwide have been constructed. Breaking the banks’ long-held monopoly on customer data, and allowing that data to be shared with other banks and third parties, radically alters the financial services value chain. From lending to payments, every participant in the industry has been forced to ask how they should position themselves to thrive in an open financial ecosystem. It is causing significant challenges for the industry — both strategically and technically — but it also promises enormous opportunities for businesses who invest today in infrastructure that will underpin their product and market strategy for the decades to come.
Europe’s leading open banking platform
Tink has become a trusted partner to Europe’s banks and fintechs as they position themselves to thrive in this ecosystem. Today, they are the leading open banking platform in Europe, working with organisations such as PayPal, Klarna, RBS, ABN AMRO, BNP Paribas and Nordea.
The founders Daniel and Fredrik were pioneers in Europe advocating the benefits of a more open financial system, and today Tink is connecting Europe’s financial ecosystem with a cloud-based platform that offers account aggregation, data enrichment, and payment initiation from a single API. Tink combines best-in-class tech with unparalleled coverage across more than 2,500 banks reaching over 250m bank customers. It is quickly becoming a core piece of infrastructure that supports its customers in building the financial products and services of the future.
This is why we’re excited to be leading Tink’s $100m Series D round alongside our friends at HMI Capital and Insight Venture Partners. The size of this raise — the largest of any open banking platform in Europe — underlines Tink’s category leadership. Ahead of this stellar team lies an opportunity to become a core part of Europe’s financial landscape providing the connective rails across the industry, as well as data and analytics products, from automated on-boarding to financial management tools.
The strategic value of this infrastructure could not be more clearly highlighted than in Visa’s acquisition of Plaid. The $5.3bn price tag reflects a very substantial multiple on revenue, pointing not just to huge growth potential for the platform in North America, but also the importance that Visa sees in the technical infrastructure for its future.
Arguably, Tink has an even larger opportunity in Europe, where regulators are mandating a more open ecosystem. They’ve already seen explosive growth in the last twelve months expanding into eight new markets, trebling monthly transactions across its platform to 750 million, and increasing their customer base four-fold. The team has grown to 270 FTEs as they’ve attracted a wealth of talent and experience from companies such as iZettle, Stripe, Klarna, Bambora, King, Nokia and Google.
There is a huge landscape of opportunity for Daniel and his team. This round of funding will enable them not just to consolidate their position in Europe, but also to expand their portfolio of data products and services and demonstrate what is possible to build and achieve in the new world of open banking.
Tink’s ambitions align exactly with Dawn’s core investment strategy. We seek to work with founders and teams who are passionate about building B2B software that enables businesses to build best-in-class customer experiences. It is exactly the same reason why we first invested in iZettle back in 2014, and from a personal perspective, I’m delighted to be investing once again in a top-tier Swedish founding team.
I am excited to see all that Daniel, Fredrik and the whole team will achieve in the coming years, and all of us at Dawn look forward to supporting them as they work to create a European financial services titan.